The law also allows the utility and state regulators to consolidate their regulatory planning processes into one plan. Currently, PSE submits six separate plans to the commission, including on gas and electric resources, pipeline safety and compliance with clean electricity law, Steuerwalt said.

The law also allows PSE to potentially merge its gas and electric rate bases, though that change would likely be more than several years away, he said.

Under last year's version of the legislation, PSE pushed to own 60% of new solar and wind projects, citing the "the need to acquire a significant amount of resources in a limited amount of time." That led to anti-competitive concerns from trade associations representing independent power producers and renewable energy advocacy groups, halting the bill.

As a compromise this year, the law adds a new process that has been used in other states that would give PSE more assurance it can pay for large capital projects that take a long time to plan and build, like transmission lines, storage and wind and solar projects.

Traditionally, utilities go ahead with new capital projects and after they are built, ask the utility commission if they can be paid back with rate increases, said Lauren McCloy, the policy director of the Northwest Energy Coalition. This new process would allow PSE to bring in the commission and public earlier to review its projects and request a "certificate of necessity," which would give the utility assurance it could raise rates to pay for them later.

Rates associated with the project under this process would not go into effect for customers immediately, only after further review of whether the company handled the project and its costs responsibly, McCloy said.

Affordability concerns

Lawmakers who voted against the legislation raised concerns the state will force people off natural gas at their own expense and raise rates on people who are least able to afford it. During public testimony in January, lobbyists with industry groups representing hotels and grocery stores and a restaurant owner testified that using methane is essential to their operations and keeping costs affordable for consumers.

"The utilities have a guaranteed ability to make a profit, and the consumers don't have a choice in the marketplace ... We're talking tens of thousands of dollars for individuals in their homes to convert their systems," said Brent Ludeman, a lobbyist with the Building Industry Association of Washington, which opposed the bill.

Others said the current electricity grid is not ready for a full transition and using fossil fuels — especially methane, which burns cleaner than coal — as a backup is a smart choice.

...continued

©2024 The Seattle Times. Visit seattletimes.com. Distributed by Tribune Content Agency, LLC.