Seattle City Light (SCL) is facing perhaps the most consequential time of its 120-year history as the utility begins the search for new power resources needed to head off looming electricity shortages. Brownouts may be in the future.
Later this year, SCL will issue requests for proposals for new wind and solar generation to help close the growing gap between its traditional power sources (hydropower and the Bonneville Power Authority) and soaring regional demand.
After years of slow growth, in 2024 City Light officials delivered new forecasts of soaring power needs. The reasons? Climate-change regulations are forcing utilities to shutter generators fueled by natural gas and coal. Meanwhile, energy demand rises due to regional population growth, more extreme weather, and data centers’ burgeoning appetite for power.
City Light’s 2024 resource plan forecasted the need to add 1,825 megawatts (MW) of power by 2033 — enough to serve more than 1 million homes — up from an additional 400 MW forecasted just two years earlier. The future forecast exceeds the 1,207 MW annual output of the Columbia Generating Station nuclear plant near Richland, the state’s single power reactor.
Yet another jump is expected in a forecast update later this year, said Craig Smith, City Light’s interim CEO. “We’ve got to figure out how do we acquire those resources,” Smith said. “We are not the only ones. The whole region is short.” Smith, a veteran City Light executive, was named to the post by Mayor Katie Wilson, who fired former CEO Dawn Lindell shortly after taking office, provoking controversy.
Power experts are sounding alarms that utilities may not be able to build and purchase all the generating capacity they need before demand overwhelms the system. Regional power demand will grow by 30 percent, or 7,800 MW, over the next decade, according to the latest Pacific Northwest Utilities Conference Committee (PNUCC) forecast.
These factors, and the short timeframe to find solutions, are sending utilities scrambling for new sources of power, primarily wind and solar. Battery storage may be expanded, and utilities are starting to contemplate new nuclear power generation as a potential resource.
Kurt Beckett is the state official with a broad perspective on issues of new power development, and he is plenty concerned. Beckett chairs the Energy Facility Site Evaluation Council, which reviews and permits large energy projects. “We’re not moving at the pace that is required of the task. No one appreciates the scale of the infrastructure. No one is prepared for this,’’ said Beckett.
The region’s energy squeeze is not a far-off matter for companies such as Seattle’s CenTrio, founded in 1890 as Seattle Steam, which generates steam heat for 139 downtown office buildings, along with Harborview, Swedish, and Virginia Mason hospitals. Its waterfront plant houses four massive units fired to 1,500 degrees (F) by natural gas.
CenTrio is facing deadlines under the state’s Climate Commitment Act to convert its boilers to electricity. The company estimates its capital cost of conversion will be $11 million. Yet after more than two years of talks the company has not secured a final agreement with City Light for the 125 MW of power it needs.
The utility recently offered a service agreement to provide 25 MW of power as a first step, but without details on the power cost. Company CEO Ian Geopferd said his company is committed to meeting the state’s climate goals, but “we can’t agree to a contract until we know the power rate.” City Light power will be four to five times the cost of natural gas, Goepferd estimates, “but we still believe it’s the right thing to do, to pursue electrification.”
The utility is now preparing a new policy for assessing charges to big customers, but CenTrio’s Goepferd said he cannot commit to construction without knowing his cost. “That’s un-financeable,’’ he said.
River water cascading through Northwest dams has powered Northwest homes and businesses for more than a century. City Light’s Cedar River dam first provided power in January 1905, followed by dams on the Skagit, Pend Oreille, Tolt rivers, and Newhalem Creek. These hydro resources generate half the city’s power needs. City Light buys 42 percent of its power from the Bonneville Power Administration, along with contracts with other generating agencies.
The region’s broad, reliable, and flexible hydropower resources are the envy of the nation, providing power for energy-intensive businesses and water for Eastern Washington agriculture. Those sources kept pace with the region’s growth — until state and local governments began the urgent push to curb greenhouse gas emissions by discouraging the use of fossil fuels, along with drivers’ embrace of electric vehicles, data center expansion, and spikes of unusually cold and warm weather. Washington’s 2019 Clean Energy Transformation Act mandates utilities provide carbon-neutral electricity to their customers by 2030 and use 100% renewable or non-carbon emitting electricity by 2045.
Not only has demand grown from building and transportation sectors, the utility’s “resource adequacy’’ needs also have escalated due to winter peaks and future uncertainty about electrification. “With this rapid growth, we need to significantly expand our energy resources to meet escalating demand,’’ City Light said in its 2024 Integrated Resource Plan. That plan identifies the options for new power:
- Additional hydropower, solar, and wind
- Batteries, storage, and transmission solutions
- Enhanced geothermal and emerging technologies, such as small modular reactors, hydrogen, and fusion
City Light today has a small wind-power contract and plans to add power from two Oregon solar projects totaling 85 MW. But as of today, City Light has no schedules, contracts, or financing plans that guarantee Seattle will have the power it will need in the coming decade. Nor does City Light know how much more the new projects will cost ratepayers, although there is no doubt they will be more expensive.
With every utility facing shortages, competition is fierce for the small number of new power projects. Adding to the challenge is the growth of data centers, which are going head-to-head with public utilities for increasingly scarce resources. Puget Sound Energy, which gave up its ownership shares of a Montana coal-fired plant, was outbid recently by Amazon for a 9,400-acre solar project in Oregon. “Their problem is that they have to meet their load growth, and deal with competition,’’ which drives up the price for new power, City Light’s Smith said. “This is a new thing. It impacts us all.”
“(P)roject development timelines are getting longer. Local opposition has led to complex permitting and state-level siting processes,’’ and transmission lines are congested, the Pacific Northwest Utilities Coordinating Committee report warns. Only half of planned projects are being completed on time. Reviewing the record of delayed projects, the Western Electricity Coordinating Council warned that “if the resource build-out over the next 10 years mimics the last five years, by 2034, the West will have hundreds of hours each year when demand is at risk.”
Beckett, EFSEC chairman, said, the region needs the energy equivalent of seven Columbia nuclear stations. To Beckett, the problems lie in the “uniquely Balkanized’’ system of independent power utilities and lack of coordination in power planning. In a memo reviewing challenges for the state’s energy system, Beckett said the current lengthy review process creates delays and uncertainties and needs to be “transformed.”
Achieving the region’s clean-energy goals — and keeping the lights on — will require the state and utilities to focus on multiple strategies, said James Hove, Washington director of the environmental organization Climate Solutions. The organization is backing a bill in the Washington Legislature to create a new electrical transmission authority to help speed construction of new power lines and is pushing for regulations to ensure big data centers pay a bigger share of new power costs. New technologies can increase the efficiency of the existing power grid, along with expanded wind and solar generation. So far, Climate Solutions is neutral on new nuclear power plants.
Marco Lowe, Chief Operating Officer under former Mayor Bruce Harrell, said City Light has been too resistant to studying other approaches to power management relying instead on simply buying more power. “We are buying so much expensive power for peak load hours of the day. Let’s explore how we can shift the peak at a lower cost,” he said. Lowe urges SCL to implement the time-of-use rate concept under study for years, new home electrical controls that balance the electricity use in a home, home batteries, and roof-top solar.
CenTrio’s Goepferd said the city is already late in acquiring new power. “Historically, it takes a brown-out or a black-out for folks to really focus on it.’’ he said. “There is some risk, and unfortunately that’s what I think it’s going to take for it to become a priority,” he said. “And I don’t look forward to that.”
The coming months will bring great pressure on City Light and the City Council to choose a strategy that assures enough power while also achieving conservation and equity goals. A significant challenge will be how to make the necessary enormous capital investments while also keeping ratepayer costs affordable.
Councilmember Bob Kettle said strong leadership of City Light is especially critical now given the power-resource challenges ahead. Kettle was among several councilmembers critical of Wilson’s decision to fire Lindell. Meanwhile, Mayor Wilson backed away from her choice of Dennis McLerran as interim SCL head, instead tapping Rob Santoff, who’s been with City Light since early 2020 and is currently its chief operating officer.
Councilmember Debora Juarez, who will be in the spotlight as chair of the council’s Parks and City Light Committee, declined an interview request. “Our office is focused on addressing power demand, sustainability, and affordability for customers for Seattle City Light,” her office said. The city’s future depends on getting those questions right.
“We’ve been able to meet these challenges in the past. It can be done,” said interim SCL chief Smith. “However, we have significant challenges with transmission capability and energy resources. The biggest concern is uncertainty.”
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