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Tri-State Generation, Environmentalists, Agree To Deal For More Regulatory Oversight

JUDITH KOHLER   12/10/09 08:04 AM ET   AP

Power Lines

DENVER — A regional rural electric provider agreed Wednesday to open up its planning process, settling a dispute over whether Colorado officials have the authority to regulate the utility.

The Colorado Public Utilities Commission accepted the agreement between Colorado-based Tri-State Generation and Transmission Co. and Western Resource Advocates, a Boulder-based environmental law and policy group. Under the terms, the public and state regulators will have more input into Tri-State's resource plans, which includes projected demands for electric power and the source and type of power the utility expects to use.

But Tri-State, a nonprofit owned by its members, won't need state approval of its resource plans, unlike privately owned utilities. It still needs approval for transmission lines, power plants and other facilities in Colorado.

In response to the agreement, the commission agreed to close an investigation into whether it should increase its oversight of the company.

"I believe this approach looks promising," said Ron Binz, the commission's chairman.

Binz said the agreement appeared to address the PUC's concerns about Tri-State's planning process without "pushing to the limit" whether the commission can legally regulate the company.

Generally, states' oversight of nonprofit electric cooperatives is limited. But early this year, Colorado regulators started looking at increasing oversight of Tri-State, saying concerns about climate change, interest in more renewable energy and the need for more transmission lines warrant a statewide, coordinated approach.

Tri-State's resource plan, which is shared with the PUC every four years, includes projected demands for electric power and the source and type of power the utility expects to use.

Environmentalists and community activists supported more state oversight of Tri-State, saying the utility depends too heavily on coal and hasn't invested enough in renewable energy. But Tri-State pointed to a new solar plant in New Mexico and wind farm in Colorado as proof that it doesn't need prodding from state regulators.

The company also argued that the PUC doesn't have the authority to regulate it. It said it is already governed by federal agencies and the elected boards of the 44 cooperatives it serves in Colorado, Nebraska, New Mexico and Wyoming.

But Tri-State and environmental representatives began talking about a compromise. John Nielsen of Western Resource Advocates said the agreement is a big step forward to giving the public a chance to work with Tri-State.

"We think this is in the best interest of all Coloradans and consistent with a strong Colorado energy policy," Nielsen said.

Tri-State has agreed to first hold public meetings and take comment on its plan and then file the plan with the utilities commission, which will be able to comment and request more information. The first document under the new process will be submitted next November.

"This approach ensures continued local, democratic control of Tri-State's resource planning and rates by our member cooperatives across four states," said Ken Anderson, the company's executive vice president and general manager.

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Filed by Ethan Axelrod  |