Puget Sound Energy, Washington’s largest private utility, has signed a 20-year contract to purchase wind power in Southeast Montana as part of a major shift away from coal- and gas-generated electricity.
PSE will buy 350 megawatts of power, enough electricity for about 140,000 homes, from NextEra Energy Resources, which is building the Clearwater Wind Project in three counties of Southeast Montana, according to a statement released Wednesday by PSE.
The wind project is expected to begin generating power at the end of 2022. It is some 60 miles north of Colstrip, Montana, where PSE is part-owner of a coal plant that has long generated electricity for the Puget Sound region.
Under Washington state law, PSE is required to stop using coal-fired power by 2025 and stop using fossil fuels to generate electricity by 2045 unless some way is found to curb the release of carbon emissions that contribute to climate change. Meanwhile, PSE, which also supplies natural gas to residential and business customers, earlier this year announced a corporate goal of reducing its carbon footprint to net-zero emissions by 2045.
This will require big changes for the utility, which in 2019 derived 66% of all its electricity from fossil fuels. And corporate officials say that part of the replacement plan involves Montana wind, which blows strongest in the winter when demand for electricity typically is strongest in the Puget Sound region.
“This is one of the steps we’re taking to meet our carbon commitment … and increase use of alternative fuels for power generation,” said Ron Roberts, PSE vice president of energy supply, in a statement. “We’ve been saying that Montana has great wind resources and this agreement demonstrates PSE’s continued investment in Montana’s energy economy.”
With the addition of the Montana generation, PSE will have a portfolio of 1,500 megawatts of wind power, which in 2019 provided 9% of the utility’s electricity.
Sierra Club for years has been pushing PSE to tap into Montana wind power, and Jesse Piedfort, the Washington state chapter director, praised the new contract.
“Projects like this are a win-win: clean electricity for Washington and jobs and tax revenue for Montana. Hopefully this is the first of many investments that PSE makes in Montana wind …” Piedfort said in a statement.
For PSE and other utilities, one challenge in the transition to new energy sources is finding enough transmission line capacity to bring new sources of power to customers. In Southeast Montana, PSE will be able to use an existing line from Colstrip to carry wind power to Washington.
In a deal that fell through last year, PSE had planned to sell its interest in the Montana transmission line along with a stake in one of the four generating units at the Colstrip plant.
The future of the Colstrip plant remains uncertain.
“We continue to work on constructive solutions,” said Janet Kim, a spokeswoman for PSE, which is one of six Colstrip owners.
Colstrip, through the years, has been a major power plant generator of U.S. greenhouse-gas emissions. It also has been a significant source of family-wage jobs in Southeast Montana, and has strong political support in the state, and in the community of Colstrip.
The Colstrip plant has been buffeted by changing energy markets as natural gas, wind and solar power have ramped up generation, and coal has struggled to compete. In 2020, two of the four units shut down.
PSE has contributed $10 million to a Colstrip fund that will be used for community planning.
The wind-power project is expected to create 350 construction jobs and 20 full-time operation jobs.