Longstanding contract provides 2 MW of baseload power as Co-op members’ winter needs and WEC’s electric peaks rise. Also: member education around EV charging, adding load, and safety
Background to Hydro-Québec Contract
Steve: In 2012, WEC negotiated a new 25-year contract with Hydro-Québec [HQ], and the Board at that time approved it. At the time, WEC did not have a crucial need for this power. Our load was declining due to rates that promoted efficiency, and our output capability from our Coventry landfill gas to electricity plant was steadily inching up. Nonetheless, our dependency on Coventry for most of our purchased power has always held some risk, and it was deemed prudent a decade ago to diversify our potential power supply portfolio as insurance. In the meantime, we arranged with Vermont Electric Co-op to share this contract with us until we needed that power for our members. They’ve purchased and used four megawatts of power from this contract since it started. Now the wisdom of providing this insurance policy has paid off, in my opinion.
Louis: There’s that, and also load in Washington Electric territory is increasing as beneficial electrification is increasing, with members using more electric power. We’re seeing higher peak loads in our territory now after years of decline or flat loads. We need the additional power, and it’s available to us, so we’re taking back two megawatts of Hydro-Québec power.
It’s important to clarify that this is 24/7 baseload power. It’s available when intermittent renewables are not. It will serve us well during the winter when solar doesn’t generate as much.
None of this is unexpected. It was always anticipated the additional power would be needed, and that it would be needed about this time. The power represented in this contract is to come to either WEC or VEC. To date we haven’t used it, so VEC has used it, and now we need it. Washington Electric is exercising an element of a contract that’s long been in place, and has long been understood would be exercised.
Why use HQ power
Steve: There are three big reasons we’re taking advantage of HQ power, and Louis pointed out the most important reason.
First, state and national policy on electric use changed dramatically over the last decade. No longer do policies primarily incentivize conserving clean electricity. Now, state policy calls for increasing electric use as the best environmental option for powering more of our needs. So, WEC members’ need for electric power is projected to increase.
Second, through actions at the Coventry plant related to the landfill expansion, the landfill gas output over the last year and a half decreased. To compound that, as we all know, power prices in the winter of 2022 spiked as we were obliged to purchase power at market prices. That drove our need for a rate increase. Being able to purchase renewable power with contracted pricing should alleviate this to a large extent.
So there are at least three reasons for why we need reliable baseload power. We expect our members will have a growing need for power over the next few decades, and we need a plan for reliable all-season power, especially over the winter months. This is a challenge for us and I expect most regional electric utilities face the same challenge.
Louis: It’s important to add, Steve, load management systems and battery systems in future years may help greatly. These would be able to match load, or how much power our members require, with when generation systems are producing power. But we’re not there yet. Our gap between load and generation is primarily in the wintertime, when solar, at least, is not as helpful.
This is stably priced reliable power with predictable pricing and it’s available to us for times when we’re now buying power from the New England market. Washington Electric buys RECs [Renewable Energy Credits] to make that power we purchase from the grid renewable. Power from HQ is also designated as renewable. It’s not new development, and it’s power that has and will continue to come to Vermont.
Steve: If we can’t get reliable power from HQ or other relatively clean energy sources, we purchase power from ISO-NE [the New England grid]. Energy on that grid is not considered as clean, although New England’s portfolio is considered to be cleaner than most other regions of the country.
The thing is, we need this power now. I appreciate the foresight of the WEC Board and staff when they set up this option in the last decade. If we had to scramble now, we might have delays and higher costs in getting this power.
Board of Directors election
Steve: I want to commend WEC’s ballot committee for running a smooth election. I thought it went very well without any hiccups, just like it should.
Louis: I’m very encouraged that we’ve had a lot of very strong applicants for the Board in the last year and a half, the time I’ve been here. It’s hard to get people to serve, whether it’s in government or the fire department or anywhere else, so it’s very encouraging seeing people are engaged and wanting to run.
Our turnout at the Annual Meeting was strong, and that’s also encouraging. Annual Meetings are how member-led organizations engage their member-owners, provide them a forum to make their opinions known, and engage in the democratic process. For our first Annual Meeting after COVID, such a strong attendance was terrific and I was happy to see it.
As a longtime electric vehicle driver, I can speak to one topic addressed in this issue. Simply because you buy an EV doesn’t mean that you need to get a Level 2 charger installed at your home.
– Stephen Knowlton
Steve: Congratulations to my fellow Board Directors Don, Jean, and Mary, on their re-election. It’s not unusual for incumbents to be reelected to the Board, and I want to thank Carl [Etnier] for throwing his hat in the ring as a candidate. The tally showed he had significant backing for serving on the Board. There’s value in running, and providing new ideas, and letting the membership know there are members interested in serving. I commend him for running and I think he had a respectable response from voters.
Member education theme
Steve: In addition to Annual Meeting and election results, this issue’s theme is member education. As a longtime electric vehicle driver, I can speak to one topic addressed in this issue. Simply because you buy an EV doesn’t mean that you need to get a Level 2 charger installed at your home. Maybe you will, maybe you won’t. It depends on how far you expect to drive every day. Any major purchasing decision we make should be made based on our personal experience and personal needs. I knew I wasn’t likely to be driving 100 miles a day and a regular 120 volt socket suits my needs.
Louis: There are a lot of members waiting for transformer upgrades to start adding new electric devices, like Level 2 chargers. We’re starting to get some transformers in. We just got some we ordered three years ago, and we have pending orders out there. Soon we’ll start working through the backlog of requests we have, but it’s a large backlog. The problems with the supply chain took a long time to build up, and it’ll take a long time to undo it. In the meantime people can get by with Level 1 EV chargers, and as Steve points out, that’s enough for many people overall.
So, we’re addressing the backlog. I will say without the careful rationing of transformers and other components, we would not have been able to recover from the Christmas winter storm. We were only able to do that because we were careful about when and where we used components, because we simply couldn’t get them. We’re still dealing with prices more than doubling in some cases, but we’re seeing signs of some relief in terms of supply.
On the topic of education: this is always an issue, but we’re having more of an issue than normal with people not reaching out to us before they add load. Whether it’s cannabis companies or people adding devices that increase load, people seem to think, or be told, that they can just add more and more devices that use electricity, and it won’t cause an issue. But it does. I encourage members to reach out to us as early as you can, and understand it’ll be a process.
For those who don’t want to deal with the process, please understand the alternative. The time spent is preferable to putting your neighbor out of power when you overload the transformer, and cheaper than the after-hours deployment of line crew for emergency repairs. So, yes, while there’s a process, it’s better to know ahead of time what you’re getting into, rather than having a surprise that will potentially put you and your neighbors out of power and cost a significant amount of money.
We’re seeing higher peak loads in our territory now after years of decline or flat loads. We need the additional power, and it’s available to us, so we’re taking back two megawatts of Hydro-Québec power.
– Louis Porter
When it comes to paying for the costs caused by overloading a transformer, the Co-op’s approach is that those who cause the expense should pay for it. So, if somebody does something like dropping a tree on a line or overloading a transformer, those expenses fall in large part on them. That’s a different approach than some utilities take, but the Co-op only has two places to go to pay for those expenses: all membership at large, or the person responsible for the expense. So a large part of the expense goes to the member.
Steve: Before you make any big changes to your electric load, you should call a licensed electrician anyway. An electrician can tell you whether your added load will overload the panel in your house, and that may impact your possible need for a new transformer.
Louis: That’s a great and sensible place to start. For anything beyond simplest things, you really need an electrician to do that.
One last thing: Members at the Annual Meeting may recall our Safety Minute feature with our Safety and Environmental Compliance manager, David Young. I’m glad that in this issue, we’re starting a new Safety Minute column to help educate members about safety. That’s a core value for us. Here at WEC, we take it as part of our jobs to educate members about education and energy use in general. That’s unusual compared to an investor owned utility, but I think it’s important as part of a member-owned and community-owned organization.