Colorado coal rebounds under new guidance (copy)

The Colowyo Mine near Craig, shown in 2017, was one of Colorado’s highest producing mines.

A wholesale power utility’s accelerated shift from coal-fired power will result in cleaner power generation in Colorado but deal a deep blow over the coming decade to the economy of far-northwestern Colorado.

Tri-State Generation and Transmission Association said Thursday that it is planning to close all of its coal-fired generation in Colorado and New Mexico by 2030. The move comes in response to state requirements and goals, and demands from some of the local power cooperatives it serves to move toward cleaner and increasingly cheaper power sources.

But for Moffat County, the consequences will be dire. Tri-State plans to fully close its Craig Station coal-fired power plant by 2030, along with the local Colowyo Mine that supplies it. The plant employs 253 people, and the mine, 219.

The decision also leaves in doubt the future of the local Trapper Mine, which also supplies the power plant.

“It’s a dark day for western Colorado, and specifically for Moffat County,” said Moffat County Commissioner Ray Beck. “I think we all knew that at some point Tri-State was going to come out with an announcement (on the plant’s future). I think for a lot of us it came sooner than expected. I think it’s one heck of a way to start the new year.”

In a news release, U.S. Rep. Scott Tipton, R-Colo., said that based on Moffat County’s population, the 472 jobs to be lost at the plant and Colowyo are equivalent to losing about 98,000 jobs in the Denver metro area.

He blamed the job losses on actions approved last year by the state legislature and Gov. Jared Polis.

“This loss of these jobs is on the Governor’s hands and on each of those that voted for his plan. They should be forced to look these impacted families in the eyes and explain to them why they think their livelihoods are not important enough to save,” Tipton said.

Polis last year signed several bills addressing climate and energy in the state and unveiled a plan for Colorado reaching 100% renewable energy by 2040.

One bill he signed sets goals to reduce greenhouse gas emissions by 50% in 2030 compared to 2005 levels and directs air-quality regulators to develop rules limiting carbon pollution.

Tri-State says it plans to seek legislation in the state to give it certainty on greenhouse gas reduction rules.

It also is pursuing more renewable energy based on the desire of some of its own members and the fact that the price for wind and solar has become so inexpensive compared to coal.

While it continues to pay off debt related to construction of coal-fired power, the utility now hopes to be able to keep the rates it charges stable, or possibly even be able to lower them, despite the costs related to closing coal-fired power plants early.

Duane Highley, Tri-State’s chief executive officer, told reporters in a conference call Thursday that the lower cost of renewable power is the reason.

In a statement, the Colorado Mining Association took a different view, saying, “While we understand the pressures placed on the company by the State of Colorado and environmental activists, we believe that abandoning coal-based electricity will harm electricity consumers in Colorado. The lower costs afforded by plants such as Craig Station currently help to balance the increased costs of adding renewable energy and transmission to the system.”

Tri-State last year shuttered its Nucla Station coal-fired plant in western Montrose County, after earlier committing to close it by the end of 2022.

It now is planning to close its Escalante Station plant near Prewitt, New Mexico, by the end of this year, affecting 107 employees.

Tri-State plans to provide $5 million in community support there and work with the state and local communities on things including workforce retraining and other economic redevelopment efforts.

The Craig Station has three generating units. Tri-State, the plant’s operator, owns 24% of units 1 and 2, with other utilities also invested in them, and it owns all of Unit 3.

Tri-State previously announced the closure of Unit 1 by the end of 2025, and that planned closure date remains unchanged, it says.

It says it is working with other owners of Unit 2 to determine details of that closure. Last year, Oregon utility PacifiCorp, a co-owner of Unit 2, released a draft plan proposing its closure by 2026.

Tri-State previously had projected Unit 2’s lifespan as lasting through 2038, and Unit 3’s, through 2044. Tri-State puts their current combined value at about $400 million.

Trapper Mine is owned by several utilities. Highley said its future will have to be decided by its board, but he anticipated it would have trouble remaining open when the market for its coal is gone.

Noting the 600 Tri-State jobs announced for eventual elimination, along with indirect Tri-State jobs that also will affected, Highley called Thursday “a solemn day for us,” and also acknowledged the impacts on the affected communities.

“This was an incredibly difficult decision for our board of directors,” he said.

Bonnie Petersen, executive director of Associated Governments of Northwest Colorado, said Moffat County has a workforce of about 4,700 workers.

She thinks that when indirect impacts of Tri-State’s plans are accounted for, at least 2,100 of those jobs will be impacted.

“That’s just in Moffat County. We don’t have any idea of what the ultimate regional impact will be in terms of overall workers,” she said.

She said businesses that supply the power plant and mines are located throughout the region, including in Mesa, Garfield and Rio Blanco counties.

“All the counties in northwest Colorado will feel some level of impacts,” she said.

Beck said that leading up to Tri-State’s announcement, there had been a lot of uncertainty among residents wondering about their future and what decisions they should make, from buying cars to selling their houses.

“Now people know and so now they can start planning for the future, whatever that future looks like. It doesn’t look very bright right now,” he said.

Beck said work has been ongoing in Moffat County to pursue economic diversity, but when it comes to the coming jobs losses, “How do you replace all that? Where do you start? One job at a time, I guess.”

He’s counting on help from Tri-State and the state and federal governments to make the post-coal transition.

Highley would like to see the state’s new Office of Just Transition meaningfully help Tri-State in the transition effort, and expressed the hope for “much greater funding to support its mission,” indicating that it has limited money to work with now.

Petersen questions the rationale for closing the Craig Station, arguing that it will have no significant impact on climate change as China continues to open coal-fired plants.

“But it will have a huge impact in northwest Colorado, a huge human impact,” she said.

Kelly Nordini, executive director of Conservation Colorado, welcomed Tri-State’s announcement Thursday, saying in a statement, “As wind and solar continue solidifying their place as Colorado’s cheapest electricity sources, we are thrilled to see Tri-State take steps to catch up with other utilities by moving away from coal in a way that is good for workers, ratepayers, reliability, and our Colorado way of life.”

KC Becker, the Democratic speaker of the state House of Representatives, also praised Tri-State’s clean-energy action, but she acknowledged its impacts for some.

“Protecting and supporting workers and communities through these shifting economic tides remains a top priority for the legislature,” she said in a news release. “I look forward to continuing to work with a broad array of stakeholders to find ways to support and protect working families affected by a changing energy economy. The Just Transition Office created by the legislature last year will continue to work with impacted communities and worker representatives across the state on a plan to support those impacted by the transition away from coal.”

In a statement, U.S. Sen. Cory Gardner, R-Colo., said the Tri-State announcement is “terrible news for Craig and northwestern Colorado. These are well-paying jobs that for years have allowed surrounding rural communities to thrive. The people that live and work in Craig and northwestern Colorado are some of the toughest and most resilient people I know, and I look forward to working on their behalf in the coming years as we fight for jobs and opportunity for every area of Colorado, not just on the Front Range.”

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