Weekly Wrap Up — March 4, 2022

Listen in as Dan Catchpole and Jason Fordney discuss highlights from February 28 through March 4 in the energy industry on the west coast and northwest.

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Intro:
Welcome to NewsData's Energy West, a podcast about the energy
industry today and where it's going tomorrow.

Dan Catchpole:
Welcome, listeners.

Thanks for tuning in to NewsData's Energy West podcast.

I'm your host, Dan Catchpole, reporter with Clearing Up, joined
by my co-host Jason Fordney,

editor at California Energy Markets.

We're recording this on March 4th, and so things might have
changed when you listen to this

. Today, every week we're here to try to make folks a little
better informed, little smarter about the

western energy markets and the energy industry and what's going
on.

So Jason, how are you this week?

Jason Fordney:
I'm great, Dan. How are you doing?

Dan Catchpole:
I'm doing well.

A little hungry, but I'm doing the fast.

I'm actually doing a traditional fast for Lent.

I've been so busy, though I haven't had a chance to actually use
it to, like, reflect and use it for the spirituality, you know?

But so, a little hungry.

Besides that I'm doing really well.

So you guys had a really busy news week.

Jason Fordney:
We did. It's been an interesting week.

You know, it's been a little bit of a dark news week and maybe
that's just the overhang from, you know, the whole

European situation.

But yeah, it's kind of heavy...

Dan Catchpole:
What's going on in Europe?

Just kidding.

Jason Fordney:
There's a few things.

I don't know.

Dan Catchpole:
Yeah, sorry.

Jason Fordney:
Apparently, the nuclear plant hasn't melted down yet.

But you know, we discussed this a little bit.

It's a tendency in our profession to focus on the negative.

You know, I started out as a crime or police reporter where it
was really difficult to put a positive spin

on crime and violence.

But you know, it's a little bit of a temptation sometimes to —
what's

the word — to dramatize a little bit, but something I try to
keep in mind covering.

You know, energy has a lot of intersections with wildfires,
affordability, human suffering.

So, you know, what do you think about that?

I try to not sensationalize and, you know, throw in some
positive news, but it can be difficult

sometimes.

Dan Catchpole:
Yeah, especially when you're just pressed for time or trying to
cover so much.

And yeah, it can be.

Sometimes it's just easier because it's the the most obvious
thing is the bad news, right?

Yes, it's great when you can put that realistic, pragmatic, not
Pollyannish,

but pragmatic hopefulness or just even good news into the

story. It reminds me of a study I saw a few years ago, and it's
a study by them because I don't

remember who did it.

They do a lot of studies.

So it was a study by some reputable source looking at how people
interact with climate news, which

is, you know, pretty depressing most days to your point about
what you guys cover

. And, if it's just straight, like "wildfires are burning.

This is the new normal, get ready for it." That sort of approach,
people get pretty fatalistic and check out, and you

know, the old trope that "I don't read the news because it's
just all bad news." But

if the stories are framed, yeah, same news, same substance, but
if

it's framed additionally, with here's what's going on, and
here's

what people can do about this.

Not like activism, but you know where not just that it's well,
we're just this deterministic.

We're all screwed, but you know, like.

But if these steps are taken, that might mitigate this effect
or, you know, researchers say, "blah, blah, blah." And

you know, yeah, so readers have much more positive interaction
with the stories

and don't come away just feeling depressed.

And yeah, I was a, you know, newspaper reporter before joining
NewsData, and I know

what you mean. It's hard to put a positive spin.

I've written, I wasn't strictly a crime reporter, but I wrote
plenty of crime stories,

and that research from the study that they did,

I try to take that to heart.

I don't always remember and keep it in mind.

But that was really interesting.

It's something that newsrooms would, I think, do well to talk
about.

Jason Fordney:
Yeah, just it seems like the climate these days, you know.

I've had friends that said, "I don't watch the news, I just stay
away.

It's all too depressing." And I used to sort of look down on
that like, "No, you've got to get involved.

You know, you've got to be, you know, tuned in to what's
happening." But at a certain point, I started to understand that

a little bit more.

Dan Catchpole:
Yeah, I empathize with that.

I get it.

Jason Fordney:
Yeah, yeah.

I mean, I've I feel that way myself sometimes.

And then social media, you know, I hang out on Twitter a lot.

It's a lot of work related stuff.

But for some reason it leads to a lot of negativity.

Dan Catchpole:
Oh yeah, it's always, yeah.

Jason Fordney:
I mean, it's ridiculous right now.

It's just it's kind of a hellscape on Twitter, but you know, I'm
still on there.

And, you know, the short bursts of commentary don't lend
themselves well to reasoned,

rational discourse.

So, yeah, a few different dynamics at play in this, I think.

Dan Catchpole:
I will say there there are some really fascinating, and if you
look

for experts who — there are some amazing threads that I will
read

on Twitter that do have that, you know, really insightful
discourse to it.

I guess it's not discourse because it's not back and forth, but
it is there.

But that's like 1% or not even, 0.1%.

Jason Fordney:
Engergy Twitter is great.

I get a lot of...

Dan Catchpole:
Yeah, that's a good example of where there is healthy discourse.

Not too many hot takes, but, and right now, everybody on Twitter
is a foreign affairs

expert. So, yeah, we should.

We're supposed to keep this short.

But it's always fun talking to you.

Jason Fordney:
Let's get into it.

Dan Catchpole:
So you guys have.

Speaking of depressing news, why don't you tell us about what's
going on in California?

Jason Fordney:
Well, it was retail rate week here.

I find that every week ends up having a theme.

This week it was retail rates.

Our lead story, the headline is "Outrage from Electricity
Consumers Over PG&E Requested Rate Hike." This is getting a

lot of play even in, you know, local television media.

PG&E in June applied for a rate hike and then amended it.

At this point, they want an 18% hike in 2023, with additional
increases in 2024, 2025, and 2026.

People are already fed up with PG&E.

And you know, the energy bills in California, several people
said it used to be a car payment.

Now it's approaching a mortgage payment.

So yeah, there was a March 1st CPUC public hearing that I sat
through a few hours of commentary,

people calling in was 100% negative, objecting to the rate
increase.

Here's some quotes.

"I'm asking the commission please, please do not approve this
rate increase," Rockland resident Brian Ginter said.

"It's going to hurt the public a lot more than what's being done
right now." The utilities rates are already high.

His bill is already about $500 a month, with inflation already
making consumer costs higher.

There's different reasons for this rate increase.

PG&E says there's been significant recent developments in its
wildfire mitigation strategies.

It's proposing to update its system, hardening forecasts to
underground 10,000 miles of distribution lines, not

cheap. And then they have a new enhanced power line safety
settings program that was introduced in 2021, and they're

proposing various ways to mitigate the customer rate impacts of
these wildfire mitigation programs by reducing by $1

billion over four years of vegetation management forecast.

So a lot of play here.

CPUC is under tremendous public pressure to keep rates down,
reduce them, which probably won't happen.

I had some interesting comments one 76 year old man from Nevada
City, where I'm broadcasting from right now,

said "When I saw this new..." — well, let me put it in a Nevada
City voice — "When I saw this new application in the email that I

got, it said 18%.

I went ballistic.

I went through the roof. You've got to be kidding me.

" So, yeah, a lot of disturbing commentary from electricity
consumers

about retail rates.

And there was also an on bonk that we covered this week where
people were talking about San Diego gas

and electric rates. And then the natural gas price increase is
also exacerbating things.

So, yeah, a lot to talk about with retail rates, and we got into
it quite a bit in this week's issue.

Next on the list, the drought.

January and February in California were extremely dry.

I can vouch for that. We had a massive storm in January.

Since then, pretty much nothing.

And also in Oregon, half of Oregon is in extreme or exceptional
drought.

Reduced water supply in the Columbia Basin.

Although total water volume in the lower river is predicted to
be just below normal.

The situation is worse in California than it is in the northwest.

The manual survey, March 1 at Phillips Station, recorded 35
inches of snow depth and a snow water equivalent of 16 inches,

which is 68% of average for this location for March.

That's according to the California Department of Water Resources.

The agency said January and February will enter records books as
the driest documented in state history.

As of March 1, the statewide snowpack is 63% of average for the
date.

So pretty, pretty bad winter.

So far we've got a few weeks left, and it's going to take a
March miracle to turn it around.

You never know. And of course, a dry winter leads to a dry
summer, much drier ground and vegetation,

which really makes wildfires worse.

So, yeah, the drought situation this year started out with some
good snowfall at the beginning of the year and then

just kind of faded out.

So that that was that.

And yeah, we got a few more weeks here to turn it around.

Also in CM this week, I covered in my Bottom Lines column a new
report from Lawrence Berkeley National Laboratory

that analyzed the demographics of solar rooftop owners that had
some very revealing data on solar heavy

California. According to the data, you are more likely to have
solar on your rooftop if you're a non-Hispanic white person, make

a six figure income, attended college or graduated from one and
own your own home.

But things are also changing, according to this report, which is
entitled "Residential Solar Adopter Incomes and Geographic Trends

2022 Update." The study looked at a sample size of 2.3 Million
systems about 82% of all residential

systems installed through 2020 and covered 86% of systems
installed in 2020

. And California has so much rooftop solar.

In fact, 47% of the national solar installation was in
California that it tends to

skew the the national averages.

For instance, with a larger Hispanic and Asian population, it
pushes up the national numbers for those demographics.

But whites still have the largest share of solar roofs.

Whites make up more than 56% of solar adopters nationally, as
nonwhite Hispanics 24%, Asians

12% and Blacks 6% nationally.

LBNL expects Hispanic ownership of solar systems to grow and the
share among white households shrink.

On income, the median median annual income of solar adopters
nationally was $115,000 in

2020, much higher than the average U.S.

median of $63,000 per year.

Again, California pushing up those numbers because of its
relatively high income levels, and its outsized presence in the

sample size. Interestingly, almost all households in the study
were owner occupied households showing that, you know, renters

are still way behind installing solar for obvious reasons.

This really plays into the net metering debate here in
California, where the CPUC is saying there's some, you know,

inequities that need to be addressed as solar owners tend to be
more affluent.

This study kind of bears that out.

And finally, New Mexico.

This week, New Mexico utility regulators raised the alarm in
letters to other state officials, saying they'd like to join

forces in addressing supply chain disruptions that stand to
affect utility service across the state.

In response to an inquiry by the New Mexico Public Relation
Commission, the utilities indicated that supply chain disruptions

are affecting the availability of materials critical for their
businesses.

They're facing delays and price increases on items ranging from
conduit to conductor, transformers to trucks.

A March 2nd email signed by four of the NMPRCs five members to
Diego Rincon, Acting Secretary of the State's Department of

Homeland Security and Emergency Management, referenced another
letter to by the National Rural Electric Cooperative

Association to President Biden seeking executive assistance and
freeing up supply chain bottlenecks that are affecting

utilities supplies.

A separate second letter signed by the entire commission
addressed previous concerns raised by the New Mexico attorney

general about supply chain issues.

The attorney general, Hector Balderas, has suggested the
commission decisions contributed to the delay of replacement

resources for the coal fired San Juan generating station.

The owner of that plant Public Service Company of New Mexico,
has told the commission it will be extending

operations of a coal unit there because replacement renewable
resources did not come online due to supply

chain issues.

Supply chain issues are affecting all kinds of equipment,
including fiberglass, wood products and cross arms, creosote

and PVC conduit.

So and also vehicles.

So kind of a crazy situation.

New Mexico looking at a very tight summer supply.

So that's around the news from California and the Southwest.

And now, Dan, fill us in on the northwest.

Dan Catchpole:
A little bit of good news up here in the northwest when it comes
to precipitation.

So the northwest winter started out with some extremely wet
weather, but that abruptly ended in early January, when a dry

spell settled over the region that lasted pretty much almost to
the end of February.

The dry spell, though, came with two bits of good news for the
region's water supply.

One, the cold, dry February weather helped preserve our
snowpack, which will be good for summer generation,

hydropower generation, and the late season storm that ended the
dry spell soaked the region, dumped

snow in the mountains and helped refill some of the region's
reservoirs.

Washington state climatologist who my colleague Casey Mahaffey
interviewed, described the

winter weather as whipsawing the region.

I thought that was a perfect way to describe it.

This extremely unseasonably dry period bookended by extremely
wet weather.

So but good news for the, you know, a little bit of good news in
there.

Speaking of nuclear power plants, the Utah Associated Municipal
Power Systems, or

UAMPS, and Xcel Energy Nuclear Services have agreed to a process
to get them to a

contract for running a proposed nuclear power plant at the Idaho
National Laboratory site in Idaho Falls.

The proposed plant would put out 462 megawatts using 6, 77
megawatt small

modular reactors, so UAMPS and Xcel aim to sign the contract
later this year,

midyear. And aim also to have the plant operational in

2030.

There's a lot of interest in small nuclear modules or small
modular nuclear reactors.

Especially, you know, it's providing stability and reliability
to the power grid in the

country, around the country as utilities decarbonize and bring
on huge

loads of intermittent resources.

Also Oregon fishermen and federal regulators seem to be headed
for a collision course.

The Bureau of Ocean Energy Management and the State of Oregon
are looking at three large areas off

Oregon's coast to develop offshore wind.

The Bureau of Ocean Energy Management estimates that the three
areas which cover

2,200 square miles have a potential capacity of 17 gigawatts.

But some fishermen in the states say that building offshore wind
would

devastate the seafood industry there.

Perhaps the bigger obstacle facing developing offshore wind in
Oregon or off Oregon

is the transmission system.

And there's just a few points to interconnect right now to bring
the energy

from the offshore wind sites to the big main transmission
arteries that are

located inland running along the I-5 corridor.

Right now, the National Renewable Energy Laboratory, they did a
study in the fall, and

they say right now there's only enough transmission capacity to
handle about 2.6 Gigawatts

of nameplate capacity.

So Oregon offshore wind, it's some of the strongest, most
consistent wind in North

America, but that certainly the transmission system issue
constraint has to be solved to really make the most of it.

Speaking of the North Pacific, a Russian research vessel is still
participating

in a massive international expedition to research salmon
populations

in the North Pacific Ocean.

But the U.S.

did pull one of the science — or the U.S.

scientists that was going to be on the Russian research vessel
TINRO, and without the

without a U.S. scientist on board, the Russian vessel can't
conduct research within American

Exclusive Economic Zone.

So that will curtail the area that it can.

Obviously, it'll shrink down the area that for research that had
been assigned to this vessel initially.

But yeah, the scientists from Canada, Japan and the Republic of
Korea, Russian Federation and the United States are

still going ahead, and that'll be really valuable research.

Just a couple last things there's the Washington Legislature is
considering two bills, lower[ing] building greenhouse

gas emissions.

They could pass next week.

And Pacific Core is asking the Oregon PUC to approve a 6.6%
general

rate increase, which would bring in an additional 82.2 million
dollars.

Part of the reasons they've given is to cover wildfire
mitigation costs.

And that's it for the northwest.

You can read more about those stories and the stories that Jason
mentioned and lots more at our website

NewsData.com and find us on Twitter.

We're @CUnewsdata and at @CEMnewsdata.

And Jason, any last words?

Jason Fordney:
I really was interested in their offshore wind piece, I think
it's going to be a really tough nut to crack on the West Coast.

You know, coastal landowners tend to be wealthier.

Californians love their beaches.

You know, as far as California, we do have a little bit of
transmission infrastructure that will be at the Diablo Canyon

site, but I think it's going to be a long time, if or ever,
you'll see wind turbines off the coast.

I covered Cape May in Connecticut for years and years.

It never got built. It's just, it's a tough one.

It's expensive and affects on fishing and ocean views.

So yeah, we'll see on that.

A lot of effort coming from the Biden administration hope maybe
pushing it forward.

That's about all I have.

Dan Catchpole:
Yeah, yeah, a lot of activity from the Biden administration.

And I mean, there is stuff moving ahead.

The last month, the Bureau of Ocean Energy Management — that
does not roll off

the tongue — they auctioned off.

.. I want to say land, but it's at sea, I don't know what.

They auctioned off leases to ocean in the New York Bight, so
offshore,

where the coastline turns from going north and then very hangs
that right angle, 90 degree angle

turn at New York City there with the kind of pivot point.

So they auctioned off leases to develop that area.

And they brought in 4.4 billion dollars for those

leases. So there's a lot of money, you know, and you're right,
to your point, there's going to be a lot of obstacles.

But there definitely is some big money interested in offshore
wind.

Jason Fordney:
Yeah it looks like it.

Dan Catchpole:
Stay tuned, listeners.

Keep coming back and check us out for more coverage of that and
a lot of other things.

Jason, why don't you take us out?

Jason Fordney:
All right. That's it from us here at Energy West.

You can find more at NewsData.com.

I'm Jason Fordney with Dan Catchpole.

Have a great week.

Intro:
You've been listening to NewsData's Energy West, a podcast about
the energy industry today and where it's going

tomorrow.