SRP $1B gas plan bad for consumers, environment

Last week, Salt River Project announced that it plans to spend nearly $1 billion to add 16 new natural gas units to its powerplant in Coolidge, one of the largest fossil fuel investments by a utility in recent memory.  

I served on the SRP board from 2016-2020, and this decision stunned me. It is wrong-headed, unnecessary, and out of step with where responsible electric utilities are moving in this country. 

And, the timing could not be worse.  

Earlier this month, the United Nations released an unprecedented report on climate change, described by U.N. Secretary General António Guterres as a “code red for humanity.” The report emphasized how cutting methane emissions, the main component in natural gas, is critical to slow global warming. 

These plants that SRP wants to build are traditional gas “peaking” plants designed to meet peak electricity demand late in the day during summer months. They are expensive and inefficient because they quickly ramp up and down to meet peak demand and are off-line the rest of the time.  

We have better and cleaner options for meeting peak demand now, including solar plus batteries.  Solar is now the cheapest source of electricity on the market while battery costs have fallen 90% in the past decade. Lithium-ion battery deployment has boomed since 2019. Solar plus four hours of battery storage is now cheaper and more efficient for meeting fluctuating demand than a gas plant. But SRP seems stuck in the past, relying on what is familiar rather than what is best.  

Our state is a living example of the disruptive effects of climate change. Extreme heat, wildfires, air pollution, and drought have taken their toll on us. The U.S. Bureau of Reclamation just declared a shortage on the Colorado River, which will dramatically impact Arizona in 2022 and beyond.  

Arizona ought to be leading on the climate crisis, not fueling it. Innovative solutions and urgent action are needed, yet SRP is content to rely on tradition and let others lead. While SRP has embraced utility scale solar, it continues to discourage residential rooftop solar. While it has invested in several solar plus battery projects, it still prefers burning fossil fuels. This is deeply disappointing to me as a former SRP director. 

Besides being wrong for the environment, gas is also wrong from a fiscal perspective. Not only are renewables cheaper, but addressing the climate crisis will require us to retire fossil fuel powerplants as quickly as possible. The rapid closure of coal-fired powerplants in Arizona and across the U.S. in the past decade is just a harbinger of what’s to come. Gas plants are next. That is why forward-thinking utilities have mostly stopped investing in new fossil fuel plants. They can become “stranded assets,” unable to generate power or revenue, sometimes even before their debts are repaid. SRP is putting its ratepayers at risk and adding fuel to the climate crisis — all for nothing when better alternatives exist.  

The market signals are clear: Low costs and abundant sunshine mean the trajectory and momentum of a growing clean energy economy in Arizona makes both fiscal and environmental sense. 

The people of Arizona are calling for this shift to clean energy. A recent American Lung Association poll found more than 80 % of voters support greater investment in energy efficiency, and 79% believe Arizona should use more solar power.  

As the impacts of climate change become more apparent, SRP should be doing everything it can to support clean power and clean (electrified) transportation that will move our state toward a healthy and more prosperous future. — 

Paul Hirt is professor emeritus at Arizona State University and a former member of the board of directors of Salt River Project.