City Perspective: The future of power supply for Columbia

by Don Dasho

December 25,2007

Columbia is going to need to make some clear choices about its energy-supply future. I believe that a guiding principle should be local control. By this I mean Columbians should be able to determine their own energy future rather than being at the mercy of the regional marketplace. 
   
Currently, our electricity comes from a mix of resources that we own here in town, have joint ownership in, or have contracts for. These include coal, gas and renewable energy sources. We also have extensive conservation/efficiency programs that supply our needs by reducing our demands. 
   
Presently coal supplies some 90 percent or more of our electric energy. Coal resources in the United States will last well into the next century. Coal is abundant and low cost, which is why our cost for electricity in the Midwest is low in comparison to costs on the east and west coasts.
   
Gas supplies nearly all the remaining energy and is used mainly in the summer because it is expensive and far less abundant than coal. Its use as a home heating source means that demand pressures on gas will continue in the future, which will keep its price high. Gas costs about three times more than coal as a fuel. 
   
Renewables are coming in at about the cost of gas for biomass and wind, again three times more than coal. Wind is cost effective only if the region where it is sited has good wind continuously. Wind is not the same as coal or gas. Whereas traditional coal and gas resources run 85 to 90 percent of the time at full capacity, wind runs only 20 to 30 percent at capacity. That means that 70 to 80 percent of the time the energy must come from other resources, i.e. coal or gas.
   
Conservation and energy efficiency are solutions that must be fully exploited. Every kilowatt of energy saved reduces our demand and energy requirements. Reduction in our demands on the system has the same effect as adding energy and supply to our system. The benefit of efficiency is the avoided cost of the kilowatts that we would have to buy without the conservation measures.
   
Over the next 20 years, Columbia will spend more than $1.2 billion in today's dollars for our energy supply. Columbia needs sources that provide reliable, safe and environmentally sensitive power at a reasonable cost. If our costs exceed those of our neighbors in Ameren or Boone Electric territory, not only will our customers with the least ability to pay be at risk but our business community will founder because they will be less competitive.
   
Columbia was wise in its renewable legislation by adding a cost cap. This avoided the idea of renewables at any cost and gave the public the appetite to support our renewable portfolio standard. We must use a similar cost conscious awareness as we choose our energy future. 
   
However we meet the future, local control is a must for Columbia. The new marketplace that we are in will continue to escalate our costs unless we have a viable hedge. That hedge is local generation. Without local resources at a reasonable cost, we will be totally dependent on the regional transmission grid and market. Columbia, with its major health care system and numerous educational facilities, must maintain the needed resources to operate independently if required. That means local generation. The next-generation power plant can produce renewable energy via a biomass fuel in conjunction with fossil fuels. This type of resource would best meet the needs of the city and be environmentally sound.
   
Combining new local generation with enhanced conservation/efficiency, our existing contracts and new joint ownership, as appropriate, will allow Columbia to meet its energy needs in the most flexible and cost-effective manner.
   
It is important to have your voices heard on the power supply issues. Council must hear from all citizens so that the final decision is one that reflects the community's choices.
  
Dan Dasho is the director of Columbia Water & Light.

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