Ensuring reliable power now and in the future
By Steve Reynolds
Special to The Times
Our economy just keeps changing.
Twenty-five years ago, forest products and airplanes created most of the jobs and very few of us had heard of computer software. Today, Microsoft has surpassed many older companies as a linchpin to the state's economy.
But one thing that hasn't changed is the role that plentiful, reliable and affordable energy plays in the region's economy. It was key in the past, is critical today, and will be even more so in the future.
Software developers, data centers and biotechnology research labs all need both affordable electricity and highly reliable service. A power blip of even a few seconds can be significant to a company that relies on uninterruptible power for data security or exacting environmental controls. Even our homes, with their computers and sophisticated appliances, are growing increasingly dependent on highly reliable power.
The region's ability to provide this needed power will directly affect our ability to provide jobs for our children and grandchildren.
At Puget Sound Energy, we have two important challenges: meeting our customers' power needs today and planning for those needs tomorrow. We have a great team that keeps electricity and natural gas reliably flowing to Washington homes and businesses today. It takes a lot of hard work to do this, but it's much more straightforward than trying to make plans for 20, 30, 50 years down the road.
In the Northwest, we've had it better than most other parts of the country. Half of our power comes from dams on the region's rivers. The rest we get from Canadian dams or from natural gas or coal-fired generation plants in the region. Hydropower is a cheap and renewable resource, but it has also reached its limit. So while it's our preferred power source today, it's not likely more dams will be built to supply power for tomorrow.
We have to make some tough choices about where we'll get the power for the next generation. And these choices may well determine the economic future of our region.
It would be the best of all worlds if conservation and renewable options like wind power could fill the gap until fuel cells and other new environmentally friendly technologies reach commercial viability. That would be nice, but it's wishful thinking. PSE believes — and has invested heavily — in both conservation and renewable sources like wind energy, but our experience has taught us that these options can't come close to filling the projected energy gap by themselves.
Over the next two decades, our region's power needs will grow by the equivalent of five cities the size of Seattle. We know the growth is coming. What we don't know yet is where the additional energy will come from to support this growth, or which form of generation the region will embrace.
The only way to fill the resource gap is to pick from options that today many people find less desirable. Given our region's history with nuclear power, discussion of that resource is generally a non-starter. The more likely options are natural-gas-fired plants, which currently are expensive to operate, or the new clean-technology coal plants that are under development elsewhere. Another way to help stabilize natural-gas-fired generating costs would be to develop a liquefied natural gas (LNG) port somewhere on the West Coast. This would allow the Northwest to utilize existing resources in Alaska and elsewhere that currently go unused.
No matter which generating choices we make, they're not likely to be located close to the Central Puget Sound corridor, where the bulk of our growth is occurring. So we also will need to upgrade the region's electric-transmission system to move the power safely, reliably and efficiently from where it's generated to where it's used.
None of the options I've outlined are going to be easy or particularly popular. The easy approach would be to do nothing, and pretend that conservation and wind power can fill the gap until new technologies are deployed. But as someone whose job is to keep the power on, I realize that we need solid, reliable energy infrastructure, not wishful thinking.
These are regional issues and we need a coherent regional strategy to address them. We need to make tough decisions and wise investments today, because choices will only get tougher the longer we delay. It takes time to bring new generating resources and expanded transmission capacity on line. The longer we wait, the fewer options we'll have and the more expensive they will be.
Expect to hear a lot more discussion about these issues in the coming months. We will be inviting other utilities, elected officials, businesses and citizens to join us in a dialogue to chart a course designed to provide a secure energy supply.
It may not feel like it when you open your bill, but electricity in the Northwest is still a very good deal. Even with the rate increases of the last few years, our region's electric rates average about 25 percent less than most other areas of the country.
We have to act today to preserve our advantage for the next generation.
Steve Reynolds is chairman, president and CEO of Puget Sound Energy, headquartered in Bellevue.
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