Puget Sound Energy (PSE) announced Tuesday plans to sell its share of the coal-fired Colstrip Power Plant in Montana to South Dakota-based Northwestern Energy for $1.
The agreement still needs to be approved by the Washington Utilities and Transportation Commission. But if approved, PSE says it would eliminate nearly 50% of coal from its portfolio years ahead of schedule.
Washington’s Clean Energy Transformation Act says all electric utilities must eliminate coal-fired electricity from their portfolios by 2025.
“This is what our customers have been asking for, and we have been on a path to for years,” said David Mills, PSE senior vice president of Policy & Energy Supply. “We’re excited to take this major step forward in creating a better energy future for our customers and the state of Washington.”
The agreement would involve Northwestern Energy taking over PSE’s 25% ownership interest in Colstrip’s Unit 4 and purchasing more interest in the separate Colstrip Transmission System for as much as $3.75 million.
That would boost Northwestern’s ownership interest in the unit to 55% amid question about the plant’s future.
PSE says its coal portfolio will drop by 307 MW in early January when plant operator and co-owner Talen Energy closes Colstrip Units 1 & 2. PSE will continue to be one of five owners of Colstrip Unit 3, which provides about 185 MW to the utility’s customers. On average, 100 megawatts of coal generation serves approximately 78,000 households.
The sale struck a nerve with the Sierra Club, an environmental organization. In a release, the organization said the sale will extend the life of Colstrip, one of the largest coal plants in the West, which they say had been on the path to retirement by 2025.
“Washington is a climate leader and allowing our state’s largest utility to cut and run from its mistakes isn’t leadership,” said Doug Howell, senior campaign representative for the Sierra Club. “By selling the Colstrip plant to an out-of-state polluter rather than guiding it to an orderly retirement, Puget Sound Energy is enabling more climate disruption, more dangerous wildfires and more extreme drought in Washington. PSE should instead work with other owners to set a date for retiring the plant while helping prepare workers and the community of Colstrip for a post-coal future.”
