Coronavirus and electricity: 3 issues to watch

Source: E&E News, April 9, 2020

The novel coronavirus’ shutdown of American life is disrupting the electricity sector as state regulators, power companies and customers scramble to cope with millions of jobless claims and an inability to gather in large groups.

For some utility commissioners, that’s translated into empty hearing rooms, technological snafus, “Zoom-bombings” and tough decisions about proposed energy projects.

In other cases, it’s fueling pressure for regulators to ensure that people who have lost their jobs don’t see their electricity cut off. Deferring or waiving bills will have implications for power companies’ finances, a matter state regulators will be monitoring closely. There are also questions about pending dockets and projects that may be delayed because of the coronavirus.

“It’s certainly something that has affected all of society, and the commission is not an exception to that impact,” said Justin Olson, who regulates utilities as a Republican member of the Arizona Corporation Commission.

Utilities are keeping an eye on revenues and possible drops in demand. The outlook for pending generation and transmission projects should come into better focus over the next several weeks as utility companies report first-quarter earnings.

But some effects of COVID-19 are beginning to emerge.

Pinnacle West Capital Corp., which owns Arizona Public Service Co., said recently that some nonessential planned work was postponed to later in 2020. Detroit-based DTE Energy said March 23 that it was “safely winding down and voluntarily suspending for the time being all non-critical infrastructure and maintenance work.” DTE has said construction of the Blue Water Energy Center, a planned 1,146-megawatt facility designed to produce power using natural gas and waste heat, stopped in light of Gov. Gretchen Whitmer’s (D) order halting nonessential business. But the company said the pandemic isn’t expected to affect the center’s spring 2022 opening.

Federal delays can further affect utility plans. The outlook for the proposed Gemini Solar Project in Nevada came into question last week, for example, after the Bureau of Land Management acknowledged a delay related to a record of decision. Gemini is slated to include 690 MW of solar capacity and 380 MW of battery storage.

Ricardo Graf, a managing partner at the project developer, Arevia Power, said in a statement that his company is “confident the process is working as best it can right now.” NV Energy, the state’s largest electricity provider, told E&E News via email that it looks forward to a “successful on-time completion.” NV Energy would get electricity via a power purchase agreement, and Arevia said the project is scheduled to begin commercial operations in 2023.

And yet the power industry and those who oversee it have managed to keep the lights on even when much of the U.S. population is hunkering down.

For Olson, 41, efforts to slow the spread of the virus mean he’s working at home from Mesa, Ariz., in a house he shares with his wife, Karyn; five boys; four girls; and a black Labrador retriever named Ares. The Arizona commission held an open meeting online last month, and Olson said he’s also been on the phone discussing issues facing the industry.

“Certainly there’s a lot of interest at the commission surrounding how this may impact our utilities,” he said, and whether they’re “prepared to be able to maintain critical services in the event of an outbreak impacting their employees.”

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