Oahe Electric Cooperative, Inc.

Oahe Electric Cooperative

Our Energy Our Future Campaign

Electricity Supply

Will we have the power we need in the future?

The problem:

How will we supply the power we need to grow the economy while at the same time curbing emissions of greenhouse gases, such as carbon dioxide, blamed for contributing to climate change?

In the 1960s and 1970s, the electric industry went through a period of expansion. For many years, the nation had excess base-load generation capacity. But with the economic and demographic growth of the intervening years, that excess capacity is gone. Demand for electricity is expected to increase 26 percent by 2030. At the same time, the cost of building new generation has skyrocketed while the funding to make capital investments has shrunk. These costs will be passed on to the consumer, making electric power less affordable for many Americans. The North American Electric Reliability Corporation, the organization charged with protecting reliability of the bulk power system, has warned that between now and 2015, some regions of the country may experience rolling black outs unless we build new generation capacity.

Technology

Will we have the technology we need to supply adequate power in a carbon-constrained world?

The problem:

How does the country prioritize the limited funds for research and development and set a realistic time-frame for curbing carbon emissions without risking the supply of affordable, reliable electricity?

With technology now available, electric utilities have four options for baseload power generation: coal, gas, nuclear and, in some regions, large-scale hydroelectric. Most renewable resources such as wind or solar provide intermittent power unsuitable for baseload power generation. A report by the Massachusetts Institute of Technology (MIT) on the future of coal states categorically that "coal will continue to play a large and indispensable role in a greenhouse gas constrained world."

Since both coal and gas emit carbon dioxide, goals for reducing greenhouse gases blamed for global warming depend on (1) reducing the carbon emissions, (2) increasing efficiency and (3) remedying the problems that make alternative fuels unsuitable. Each of these approaches will require massive investments in new technology. And in the meantime, bridge technologies must be available so that cooperatives can meet rising demand.

Cooperative leadership:

Although cooperatives are not-for-profit and lack capital necessary for large research projects, they are committing valuable resources to research and have partnered with the private sector, universities and research institutions.
  • Basin Electric Power Cooperative in North Dakota has contracted with PowerSpan to conduct a commercial-scale demonstration project using the firm's CO2 capture technology, ECO2®, at a 900 MW coal-based electrical generation facility near Beulah, North Dakota.
  • Basin Electric is also operating the largest North American CCS project at its Great Plains Synfuels Plant. About 49 percent of the CO2 produced there is captured, compressed and delivered through a pipeline to depleted Canadian oil fields for use in enhanced oil recovery.

Affordability

Will reliable electricity become an unaffordable luxury for low-income Americans?

The problem:

How do we meet national climate change goals without making electricity unaffordable?

In the last five years, utility bills have risen 30 percent. The rising cost of fuel combined with the rising cost of building new generation mean that electric rates will increase even if we do nothing to address climate change.

Times are hard for many Americans. The downturn in the economy will increase the numbers of Americans who cannot afford to pay their electric bills. In the fall of 2007, Excel Energy reported that 72,000 customers faced the prospect of having their electricity shut off for non-payment. The great achievement of Franklin Roosevelt's rural electrification program – affordable electricity for all Americans – is at risk.

The energy proposals being debated in Congress all entail further increasing the cost of what has become a necessity in American life: reliable electricity.

Facts on cost:

  • The price of coal – the fuel for over half of America's power plants – has doubled since last year while the cost of natural gas – another common fuel and currently the only reasonable alternative – is more expensive and volatile. A growing reliance on more expensive unconventional sources and liquid natural gas, combined with higher natural gas demand from the electrical sector, will put increased stress on electric costs.
  • The cost of building new power generation is rising: A $1 billion plant built in 2000 would cost $2 billion today.
  • The typical household in America spends about $1400 per year on electricity.
  • A 2008 Environmental Protection Agency analysis of the Warner-Lieberman bill to cap carbon emissions projected that under the bill electricity prices would increase 44 percent in 2030 and 26 percent in 2050.

Cooperative leadership:

The National Rural Electric Cooperative Association (NRECA), along with the Consumer Federation of America, Consumers Union, National Association of State Utility Consumer Advocates, and National Consumer Law Center are urging Congress to take a least-cost approach to climate change.

Ultimately, consumers will be paying the bill for programs to reduce carbon emissions – they should therefore be considered equal stakeholders in policy debates that until now have included only environmental groups and industry.

For more information, and to contact your state officials in Washington D.C., please visit www.ourenergy.coop .

Integrity, Innovation, Accountability, Commitment
Oahe Electric Cooperative, Inc. :: 102 South Canford :: Blunt, SD 57522-0216 USA
[hours] 7:30am-4pm CDT Mon-Fri :: [ph] 605.962.6243 :: [fax] 605.962.6306 :: oahe@oaheelectric.com
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