For Public Utilities, Customers Spark Pioneering Policy with a Vote — Episode 133 of Local Energy Rules

The primary reasons that I wanted to be a candidate and then a director at OPPD were outlined pretty clearly in my campaign. I was focused on a fair rates, public engagement, and new energy market opportunities. In 2015, there was a rate restructuring at OPPD that increased the fixed fee. And that was a concern to me and a number of other people. And I think that really encouraged people who wanted to see some new policy at OPPD to become involved, to run for the board of directors, just like I did, and then see what other ways we could continue to improve our local electric utility. The fixed fee is somewhat of a regressive rate policy and particularly coupled with the declining block structure that we had, that it discourages energy savings and really hurts the economics of distributed energy generation. And so those two components were, were really what was most important to me.

And additionally, the economic and environmental justice component of a high fixed fee, which means that it gets less expensive as you consume more. That was a, that was kind of the primary point of my campaign. And I talked about it a lot in 2018, and I’ve talked about it a lot since joining the board. I mentioned the second component was public engagement. You highlighted that Nebraska is the only all public power state. And so I feel a strong responsibility to represent the people of my district and engage with them so that they feel their voices are heard on the Board of Directors and then in the policymaking, within our local electric utility. The third thing I highlighted was a little bit more technical. I, uh, during the campaign, I said new energy market opportunities, but that specifically means clean energy, energy storage, beneficial electrification, investing in energy sources that we have here in Nebraska and finding ways that we can update our policies and make sure that OPPD is really delivering for the people of our district. And so those three things were the central points of my campaign. And they’ve been the central points that I focused on in the first couple of years on the board.

In 2019, when I joined the board, there were a couple other new board members as well. And one of the things that we, uh, collectively agreed needed to be reassessed was what’s called strategic directive number seven on environmental stewardship. And that’s where we set the outcome that we’re looking to monitor. That’s where the 20% carbon intensity reduction metric was set originally. And, uh, and the board decided that rather than measuring carbon intensity, the most important measurement should really just be the absolute amount of carbon. And so in 2019, that policy was updated to say the net zero carbon by 2050 in all of our operations. And so there have been a couple of times recently where that has been discussed, but I think the recognition that carbon intensity is good – It’s good to reduce your carbon intensity, but that isn’t really what controls the, the primary desired outcome that we want to have an impact over, which is reducing the causes of climate change. And so if you reduce your carbon intensity, your absolute carbon emissions could still be increased. And I think in 2019, it was collectively decided that the best way to serve the environmentally sensitive portion of our mission was to update that, to say a net zero carbon goal, and, and from OPPD setting our goal, I think that’s demonstrated kind of a, the path forward across the state. Just a couple of months ago, Lincoln Electric System established their own net zero carbon goal with the date of 2040 and Nebraska Public Power District is currently in the process of doing a decarbonization study to determine what will be the timeline and the level of carbon reduction that will be the best for their customers as well.

So I think since OPPD began the discussion in 2018 and made that big update, there’s really been a lot of progress in our state. And I think we have a bright future of continuing to deliver improvements in those policies by, by all of the major utilities across Nebraska.

So when we talk about what will the path from where we are, to the zero carbon outcome look like? That is currently being developed and the board of directors works primarily, but the senior management team, and we’ve had pretty regular updates and there will be a public update about the de-carbonization work at our next monthly board meeting. And so we’re making sure that again, that public engagement that, that I focused on in my campaign is being delivered so that people know we’ve said, we want to achieve this goal now, how are we going to do that? I think it’s important that we make sure we continue to provide that information as things update through time. And, and you specifically asked about, can the timeline be advanced? I think that we have set a bright north star goal, as our CEO and president has said, of net zero carbon by 2050.

I think that timeline is, uh, is, is a good one to keep in mind, but in the interim, uh, I’m interested to see if we might define other metrics along the way because it’s, 2050 is 30 years away and there will be a lot of work between now and then. So do we need to make sure an established kind of interim goals as we look toward the long-term outcome? I think that’s something that we should discuss and that we should make sure we have kind of checkpoints as we get to the final outcome of, of zero carbon.

I think that’s distributed generation, both of solar, for example, on your home, uh, or a battery for distributed storage. I think those are areas where policy needs to be developed to say, if you wish to participate in the clean energy transition through your own life, we have policy that supports you in doing that. And it can be both a clean energy answer, but also economically beneficial to you so that we aren’t discouraging people by saying, yeah, we really don’t want you to have a lot more electric consumption. We want you to choose to use electricity as a cleaner source of energy than what you might otherwise have been using.

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We are in the position where our meters will need to be upgraded in the next few years. And so I think it’s a, it’s a difficult time to say, we’ve got to wait for this other piece to be accomplished. And that can be a little bit anxious to say, you know, we know something big is going to happen when we do the, um, the next install of the, of the meters, because they’ve reached the end of their normal service life. That will be a time when a whole bunch of additional options become available. So you’re right. We have also taken some of those interim steps by using external communication networks, wireless, but I think the, the opportunity is right on the horizon. And that’s why I’m so excited to see that become available in a couple years.

And so when that change happened, I think that represented a recognition by the board and by the management that the customer owners do want to see a recognition of this other value equally incorporated, as we make decisions about what type of generation are we going to have? What type of technology are we going to apply? And so making an update to the mission statement of the utility, I think was another big step forward. And that I think comes on the heels of an increasing and more broadly understood desire from the public to have more clean energy. Study after study has highlighted that people want clean energy. They like clean energy. They know that the investments in their communities are beneficial for their public schools. For example, that by situating wind farms in Nebraska and solar projects here, we are building local property tax base and creating a second revenue source for some of the rural communities who have really been hit hard by a, a large fluctuation in agricultural prices over the last couple of years. So, um, in Nebraska, that’s a big driver that people want to see that additional stable revenue from a locally produced clean energy project in their community.

And then I think the last point that just really can’t be ignored is the absolutely overwhelming economics of clean energy. At this point, that if you look back to 2010 and what the projections were for the future costs of wind and solar, the current prices absolutely blow those out of the water they blow the expectations out of the water. And so at this point, if you are a utility who has new demands coming on and you need to serve that new demand, like we have several data centers that have come to our community recently. So a very large increase in our load. The most cost-effective way for us to bring new generation online is to implement clean energy. And that’s evidenced through our specific project called power with purpose, which is a very large investment in utility-scale solar. We are working on the contracts now, between 400 to 600 megawatts of utility scale solar. That will be the first large scale solar at our utility and in Nebraska. And then that also was coupled with, um, some peaking gas turbines, which together allowed us to shift away from some of the older coal generation and take that offline. And so those two resources together allow us to meet the high new demand that we saw coming into our community. And the primary driver was because clean energy was the cheapest new generation that we, that we can have in our community. So all of those things together, I think demonstrate that clean energy really has arrived and is something that we need to recognize. And the places like the EIA and others who have consistently underestimated the cost-effectiveness of clean energy, I think they need to make sure they understand that this is the new baseline for the industry, and we need to be ready to see implementation because people want it. And it is the most cost effective.

There’s currently a bill in the legislature that would set a clean energy standard across the state for the electric utilities. And that is based on the same goal that we have, which is the net zero carbon by 2050. And so I think the recognition that the utilities have demonstrated we can do this. We have policy ourselves to, to point in this direction, the legislature is now also saying, yes, we hear that. And we want to be a part of the solution and the clean energy future as well. So I think that the electric utilities, the public electric utilities, are working successfully with the legislature and also with our customers, the cities across the state of Nebraska to deliver on those, those steps towards the clean energy future that we all know.