CEO’s Message – October 2022
All of the Above
My late father-in-law taught history at Wells High School for many years. When he gave multiple choice tests, he would ensure that his students weren’t just getting by with lucky guesses by including “All of the above” among the possible answers.
For most of my career, answers to questions about wholesale power supply were largely driven by practical considerations. Wells Rural Electric Company (WREC)’s proximity to the Columbia River drainage basin made hydroelectric generation an excellent choice for safe, reliable, affordable and clean electricity. The decision to purchase our wholesale power supply from Bonneville Power Administration—which markets the 99.9% reliable, clean electricity generated by Columbia River dams—combined with consistent efforts to control costs locally, has given our members more than 50 years of affordable electricity and five years without a rate increase.
In Utah and Wyoming, abundant coal supplies made that fuel a reasonable choice for generation, while natural gas was the leading fuel supply for generation in states such as Texas. Utilities in other states opted to include nuclear power plants in their energy production. Wind and solar resources are becoming an important part of the electricity supply mix, but there are limits to how much intermittent generation can be integrated without compromising reliability and affordability.
Utilities often use a mix of generation resources to achieve the ideal combination of reliability and affordability. Essentially, many utilities—and the electric power grid in general—operate on all of the above.
The heat wave in late August illustrates the wisdom in an all-of-the-above approach. Although our members weren’t directly affected, consumers across the West were asked to reduce their energy use, especially in the late afternoons and early evenings. The need for reduced use was driven by a combination of solar production falling off as the sun sets and air conditioning and other appliance use picking up as people returned home from work. Fortunately, a mixed generation system built on a base of hydroelectricity, supported by a large-scale nuclear plant, and supplemented by wind, solar and natural gas generation was able to meet the demand.
The pressure on the grid was certainly a concern for utilities like WREC, which focus on reliability. But there was also an upside: it renewed the discussion about the importance of a diversified electricity supply mix. All of the above is being given renewed attention as a possible strategy for transitioning to a cleaner energy future, as it should.
Clay R. Fitch, CEO