“Nothing under the facts or plain meaning of the DOE orders would make Bonneville a customer of TransAlta, or otherwise make Bonneville responsible for costs associated with the availability or dispatch of (the Centralia power plant),” wrote BPA attorney Matthew Perkins in an opposition brief submitted to the regulatory commission.
The Bonneville Power Administration has not explicitly stated whether it would pass on TransAlta costs to its own customers. BPA serves wholesale power to more than 130 utilities spanning Oregon, Washington, Idaho, and western Montana.
Those customer utilities are alarmed.
“It would be wholly inappropriate to allow even a penny of cost recovery from Bonneville,” wrote a trio of attorneys representing rural electric cooperatives, the Portland-based Public Power Council, and the Snohomish County Public Utility District, in a protest filed with FERC on Monday.
GridForce said it could be forced out of business if stuck with a share of TransAlta’s tab. The Texas-based data provider asked FERC to be removed from responsibility because it had no say in the decision-making for Centralia operations.
The Federal Energy Regulatory Commission will likely assign an administrative law judge to review the TransAlta cost recovery case and then send a recommended judgment to the five-member commission for a final decision. The five commissioners are political appointees, three Republicans and two Democrats. A FERC spokesperson this week declined to offer any guidance on the timeline for adjudication of the case.
TransAlta walks a fine line
Throughout all this, TransAlta has taken pains to avoid criticizing or antagonizing the Trump administration. During an earnings call with Canadian stock analysts last month, CEO Joel Hunter repeatedly stressed that his company was complying with the Department of Energy order to keep the Centralia coal plant available to operate.
But Hunter also let on that he did not expect Centralia to restart using coal because the price would be deeply uncompetitive.
“It hasn’t run thus far and our expectation is that it likely will not run here, you know, through (the duration of) the order,” Hunter said.
The company’s cost recovery filing to FERC elaborated on how the economics of coal-fired generation have become unfavorable in Washington state.
The Democrat-controlled Legislature voted to apply the state’s hefty sales tax to coal deliveries as of this spring. The same legislation also decreed that TransAlta would have to purchase climate pollution allowances at the state’s periodic cap-and-trade auctions if it resumes burning coal. The cost of those emissions fees would be very high, given that coal has a much larger carbon footprint than the alternatives.
Any power produced from coal in Centralia would have to be sold out-of-state because Washington electric utilities cannot purchase coal-derived power due to a clean energy transition requirement that took effect in January.
Hunter said TransAlta wants to proceed with its previously announced plan to convert the hulking 730-megawatt Centralia coal power plant to run on natural gas in a few years.
“Progress continues with the conversion, and I’m pleased to report that our timeline for a final investment decision in the first quarter of 2027 remains on schedule,“ Hunter told the Canadian stock analysts. “We are doing the front-end engineering and design work right now at the facility.”
In a separate federal court case, the Washington attorney general and environmental groups are asking a judge to negate the Energy Department’s emergency orders keeping the Centralia coal plant alive. That case is on a slow track at the 9th U.S. Circuit Court of Appeals.
TranAlta’s Centralia operation is one of at least six coal-burning power plants around the nation that the Trump administration is trying to keep open past their planned retirement dates.
