By Michael Brooks

LEXINGTON, Ky. — FERC Chairman Neil Chatterjee’s EnVision Forum, held last week at the University of Kentucky, was a unique energy conference in several ways, from the diverse lineup of speakers, to the wide variation in panel topics.

Perhaps most unique, however, was its location.

It wasn’t just the fact that it was held in a university football stadium. Or that lunchtime dessert featured bourbon-frosted bread pudding.

For his inaugural annual event Oct. 21, Chatterjee chose his home state, a place dependent on coal mining for its economy and coal-fired plants for most of its power, with 75% of its electricity generated by coal last year, according to the U.S. Energy Information Administration. It’s the fifth largest coal producer in the U.S., and about one-fifth of all operating U.S. coal mines are located there, according to EIA.

And judging by several of the panels at the conference, the state doesn’t care too much about the national conversations in the electricity industry: the increasing penetration of renewables, the threat of climate change and the need to modernize the grid.

“Well first off, I want to not apologize for the things we haven’t jumped on the bandwagon for,” Kentucky Public Service Commissioner Talina Mathews said in opening “Lessons from Kentucky: A Case Study in the Energy Transition.”

“We remain vertically integrated. … We remain predominantly fossil fuel[-powered]. We don’t have a [renewable portfolio standard]. … But what we do have is reliable, baseload generation that serves our homes and also serves a large manufacturing base in Kentucky,” Mathews said. “We make things here, and I think that may be different from some of the other states that maybe have the ability to rely on more intermittent sources of energy. I don’t think an aluminum smelter is going to deal very well with anything under a 90% load factor.”

Chris Perry, CEO of the Kentucky Association of Electric Cooperatives, referred to an earlier panel entitled “Empowering 21st Century Energy Consumers with Technology,” which featured Jeff Riles of Google and Brian Janous of Microsoft.

“They were talking about … a two-way communication, where customers are really engaged, getting a carbon signal, adjusting their usage. Let me tell you, in rural Kentucky, that’s not happening,” he said.

A member of the audience asked whether utilities in the state disclose electricity usage to ratepayers. “Sure,” Perry said. His co-ops also provide voluntary demand response programs. “Guess how many people sign up? Not many. Not many. We find out they get excited for a short period of time, and then it’s, ‘I want to dry my clothes when I want to dry my clothes.’”

Another audience member asked the panel, which also featured Kentucky Power President and COO Brett Mattison and LG&E and KU Energy CEO Paul Thompson, if their utilities were seeing increased customer demand for renewables as in the rest of the U.S.

“We don’t have the best resources,” Mathews said. “I jokingly say Kentucky is the allergy capital of the world because the wind hits the plains and then all of a sudden it just stops, and we breathe pollen from April to November. …

“You would never build wind here if you can build it in Oklahoma,” she said, making a similar comparison with solar and Arizona. “So, we’ve heard, but we really haven’t had many of those [renewable projects] come to the commission.”

“You have many customers who sometimes will say, ‘Well we’d like to see some renewables; we’d like to see some zero-carbon energy,” Big Rivers Electric CEO Robert Berry said. “But they’re not really interested in paying for it.”

Berry said a co-op survey revealed 40% of its customers wanted to get their electricity from solar, but only 20% were willing to pay “some amount” more for it. Only about 5% were willing to pay 2 to 3% more, he said.

Kentucky had the seventh-lowest average electricity price in the U.S. last year and the lowest price east of the Mississippi River, according to EIA.

Unaffordable Renewables?

The argument that the switch to renewables would cost low-income ratepayers more was one that continually came up on an earlier panel entitled “All of the Above vs. Green New Deal,” the latter a reference to a Congressional resolution to transition the U.S. to 100% zero-carbon energy by 2030. Moderated by former FERC Commissioner Colette Honorable, the panel featured several state utility commissioners, most of whom criticized the Green New Deal as too costly for their customers.

“I represent the poorest region in the poorest state in the United States of America,” Mississippi Public Service Commissioner Brandon Presley said. “And the impact of an electric bill on a Mississippian is much more than it is in many other places in the United States of America. It affects our cost of living.”

“In the Eastern Kentucky footprint, where we serve, we have the same exact thing,” Mattison said on the Kentucky panel, referencing Presley. “Probably 30-plus-percent of the individuals find themselves at or below the poverty line. So when you look at transitioning to new sources, there’s always a cost associated with that. … We have constituents and customers who can’t afford to pay for that.”

Speaking on the earlier panel, Richard Kauffman, chairman of the New York State Energy Research and Development Authority, pushed back against these arguments.

“This issue of affordability I think is a red herring,” he said. “You [need to] create the right kind of innovation and market-related practices and change the financial incentives and business model for distribution utilities to be more system integrators as opposed to just being in the business of deploying capital — because that’s one of the reasons we have such low average capacity utilization.”

Wisconsin Public Service Commissioner Ellen Nowak responded. “I think it is a real concern. In my state, we have a lot of manufacturers, and the margins on their profit are very dependent on the cost of their energy. And as an economic regulator, we have to be smart about what we’re requiring them to pay for. That’s why this transition has to be done in a meaningful manner, not in a date that you set out and then figure out how you get there.”

“If we’re not careful, we’re going to burden all customers with a lot of stranded assets,” Kauffman said in reply. “Capital and energy inefficiency is a burden that we’re currently imposing on customers, and we can get more out of the customer bill. Think of that as a cost offload.”

Impact on Communities and Workers

Another panel focused on the impacts of the “new energy economy” on coal-dependent communities.

“Kentucky, like many states, has experienced firsthand the workforce and community impacts of our changing fuel mix,” Chairman Chatterjee said in an opening speech. “Behind every major energy project and company are dedicated energy sector workers. These women and men work hard to expand, improve and modernize our nation’s energy infrastructure and serve as the humming engine of our energy economy. …

“Right here in Kentucky, we’re in the heart of coal country. … The [coal] plant retirements that we’ve been seeing have real impacts on the workers, families and local economies here in Kentucky and throughout the United States.”

The panel wasn’t as dour as one might have expected, but it still illustrated the challenges blue-collar workers will increasingly face as coal plants continue to shut down and nuclear plants remain uneconomic to build.

Speakers included Brian Kerkhoven, energy policy adviser for North America’s Building Trades Unions, a federation of 14 unions that includes the International Brotherhood of Electrical Workers. Kerkhoven said his organization offers apprenticeship programs to train “out-of-work coal miners, who sure as hell aren’t going back to become nurses,” to become construction workers.

“We are now seeing a huge growth in our pre-apprenticeship program,” Kerkhoven said. “Not everybody has to go to college anymore, and we’re trying to lead that charge. … And that’s going gangbusters,” particularly in Texas.

He said renewables “don’t create the amount of jobs that coal, nuclear and even natural gas, to a certain extent, create. … Six to seven hundred people go to work every day at a nuclear power plant. A team of five to 10 go around and make sure the windmills are still spinning.”

Donnie Colston, director of IBEW’s Utility Department, concurred, saying the union’s members work on all resource types, but gas units, wind turbines and solar panels require very little maintenance compared to coal and nuclear plants.

“The good thing is … we’re being able to move” workers at shuttered coal plants “into other positions where members are retiring,” Colston said. “We’re not having massive layoffs.”

That still involves teaching workers a new trade. Utilities need to wait three to eight years, for example, for new linemen to complete their apprenticeship programs, he said.

Colston was incensed by the failure of states to approve interstate transmission lines, citing New Hampshire’s rejection of the 192-mile Northern Pass line that would have brought Canadian hydropower to Massachusetts, and Arkansas’ rejection of the 720-mile Plains & Eastern Clean Line, which would have transported wind energy in Oklahoma to the Tennessee Valley Authority.

“We worked for probably eight years with Eversource Energy” on Northern Pass, Colston said. “That was 2,000 jobs for IBEW. It came down to one vote on one committee that eliminated eight years’ worth of work. …

“Now, I don’t think we want to take away a state’s right to say you can’t build the lines, but if you want clean energy, as baseload comes off, you got to build lines,” he said.