No help for rural coops in Tri-state battle

State says Tri-state is under federal purview, out of its jurisdiction

Rural electric associations that want out of their contracts with Tri-state Generation and Transmission Association won’t be getting help from Colorado regulators.

The Colorado Public Utilities Commission has dismissed formal complaints by the La Plata Electric Association in Durango and Brighton-based United Power, Tristate’s largest member. The commission voted unanimously Oct. 22 that the dispute is out of its jurisdiction because Tri-state is now under federal regulation.

The decision reverses a state administrative law judge’s earlier finding that Tri-state’s response to the electric cooperatives’ request for an exit fee was “unjust and unreasonable” and that the cooperatives’ proposals for breaking their contracts were proper.

But the PUC said it can’t intervene in the conflict that has spurred lawsuits and objections from state lawmakers. The commission pointed to an August decision by the Federal Energy Regulator y Commission that said it has exclusive jurisdiction over any exit fees because it began regulating the Tri-state’s rates in 2019.

The electric cooperatives’ challenge of Tri-state’s change to its membership that allowed it to seek federal regulation is a matter of corporate law and should be pursued in the courts, the PUC said.

Legislative leaders said in a Sept. 28 letter to the PUC that the state should regulate Tri-state because the company “can best serve its Colorado customers when being held accountable by Coloradans.” Issues affecting state policies and rural Coloradans should be decided in Colora

do, “not in Washington, D.C., where it will be difficult for local stakeholders to par ticipate.”

Last year, the legislature passed a bill that requires Tri-state to get approval from the PUC on its energyresource plans. Tri-state has said its regulation by FERC won’t af fect that.

Tri-state provides wholesale power to dozens of members in Colorado and three other states. It has faced defections and attempted defections amid criticism of its rates, a cap on how much electricity that members can produce on their own and what critics say is too much reliance on coal.

In April, the Delta-montrose Electric Association paid $62.5 million to end its contract and $26 million to buy back transmission facilities.

However, Tri-state points to a plan to increase its use of wind and solar energy and cut greenhouse-gas emissions. It recently said it will reduce rates over the next three years and allow members to generate more of their own power.

“We are pleased that the Colorado Public Utilities Commission agrees that the Federal Energy Regulator y Commission has exclusive jurisdiction over member withdrawal charges, and that questions of Colorado corporate law are a matter for the state courts,” Tristate CEO Duane Highley said in a statement.

United Power said it will continue to pursue a lawsuit in Adams County District Court that challenges Tristate’s changes to its bylaws. The changes allowed the addition of nonutility members and paved the way for Tri-state to be regulated by federal rather than state of ficials.

The La Plata Electric Association is considering what its next steps will be, CEO Jessica Matlock said in an email.

“LPEA continues to seek flexibility from Tri-state in our current 50-year contract to develop local, renewable generation and to reduce our power supply costs. And we are hopeful we can get there working with Tristate,” Matlock said.