proposed regulations will impact reliability and costs
By Todd Brickhouse
This issue of Basin Today is being prepared just before Earth Day on April 22 and will be published shortly thereafter. In the spirit of Earth Day, there are a number of environmental issues I’d like to discuss with you.
By the time you are reading this, the Environmental Protection Agency (EPA) will have published regulations that, if implemented, will adversely impact the reliability of both Basin Electric’s system and the United States’ electric grid.
Basin Electric employs an all-of-the-above energy strategy to serve our members’ power supply requirements. There are many benefits to this strategy — including relatively stable costs and buttressing the intermittent nature of renewable resources with more reliable dispatchable resources — which have allowed us to reduce the carbon intensity of our sales by more than 30% since 2005.
To defend our all-of-the-above energy strategy from the EPA’s regulatory overreach, we have had to develop an all-of-the-above legal and regulatory strategy. We are partnering with regional and national trade associations, state and federal elected officials, and partners in the utility and adjoining industries to limit the damage from the EPA’s regulatory onslaught.
The EPA’s actions also have profound implications for our country. The United States has three geographical and geological strategic advantages that bolster our security and strengthen our economy. First, the Atlantic and Pacific oceans provide a buffer from foreign adversaries. Second, we have approximately 25,000 miles of navigable inland waterways that facilitate commerce. Third, we have an abundance of natural resources to draw upon for food and fuel.
The EPA is not trying to drain the oceans and inland waterways, nor is it trying to shut down the delivery of products across our waterways. But the proposed regulations will impact how the operators of our nation’s electric grid fuel the electricity that flows across transmission lines, which will have both known and unintended consequences on reliability and costs.
Reliability is likely to suffer, and costs will likely be higher, which will have adverse implications for standards of living in the United States.
These observations are not meant to be combative or belligerent. On the contrary, Basin Electric has a proud history of environmental stewardship that has emphasized innovation over regulation. In addition to reducing the carbon intensity of our sales, we have achieved even more dramatic decreases in other emissions such as sulfur and nitrogen oxides. We have accomplished this in part by investing nearly $7 billion in a renewable portfolio that now stands at nearly 2,500 megawatts (MW) versus 1,000 MW a decade ago.
Basin Electric, through our subsidiary Dakota Gasification Company, is also a pioneer in carbon dioxide (CO2) sequestration. In the late 1990s, Dakota Gas invested $100 million to build a 205-mile CO2 pipeline from Beulah, North Dakota to Weyburn, Saskatchewan, in order to capture CO2 in Canadian oil fields. Since 2000, nearly 45 million metric tons have been captured. On Feb. 9 of this year, Dakota Gas began sequestering additional CO2 adjacent to its facilities, and in this project’s first full year we expect to sequester an incremental 1 million tons of CO2.
While Basin Electric does not yet sequester CO2 at any of our generation facilities, we are leaders in researching and investing in CO2 sequestration for generation facilities. Basin Electric hosts the Wyoming Integrated Test Center (Wyoming ITC) at our Dry Fork Station near Gillette, Wyoming. The Wyoming ITC has attracted more than $100 million for research and development projects for testing carbon capture and storage technologies.
What I’ve shared above just begins to scratch the surface of Basin Electric’s proud history of environmental stewardship. While Earth Day is celebrated on April 22 each year, Basin Electric’s commitment to the environment is 24/7/365. And we are committed to providing electric service in a reliable, affordable, and environmentally responsible manner.
