Reducing Our Carbon Footprint

Financial implications and other risks and opportunities for company’s activities due to climate change

Rising concerns about long-term global climate changes could have a significant effect on our business. There has been increasing legislative action related to concerns over long-term global climate changes, which may affect our operational and financial performance.

Avista continues to monitor and evaluate the possible adoption of national, regional, or state requirements related to global climate changes. These requirements could result in significant costs for us to comply with restrictions on carbon dioxide and other greenhouse gas emissions, and could also preclude us from developing certain types of generating plants or entering into new contracts for the output from generating plants that do not meet these requirements.

Environmental laws and regulations may:

  • Increase the operating costs of generating plants;
  • Increase the lead time and capital costs for the construction of new generating plants;
  • Require modification of our existing generating plants;
  • Require existing generating plant operations to be curtailed or shut down;
  • Reduce the amount of energy available from our generating plants; and
  • Restrict the types of generating plants that can be built.

Avista is actively monitoring legislative and regulatory developments for climate change and restrictions on greenhouse gas emissions. As part of our Integrated Resource Plan, we include estimates of climate change into the retail load forecast. Changing temperatures and precipitation, including snowpack conditions, affect the availability and timing of stream flows, which impacts hydroelectric generation, and could also increase or decrease customer demand.

We are the 16th lowest emitter of CO2 of generating utilities in the U.S. and the 6th lowest among investor-owned utilities. With 56 percent of our net generation capability from hydroelectric and a majority of our thermal generation fueled with natural gas, plus a commitment to energy efficiency, we are one of the greenest utilities in the nation.

Avista has a Climate Change Council, an interdisciplinary team of management and other employees, which is designed to:

  • Anticipate and evaluate strategic needs and opportunities relating to climate change;
  • Analyze the company-wide implications of various trends and proposals;
  • Develop recommendations on positions and action plans; and
  • Facilitate internal and external communications regarding climate change issues.

Longer term issues involve emissions tracking and certification, providing recommendations for greenhouse gas reduction goals and activities, evaluating the merits of different reduction programs, actively participating in the development of legislation, and benchmarking climate change policies and activities against other organizations.

Strategies for managing and phasing out high and low level PCBs

Manufacture of Polychlorinated Biphenyls (PCBs) was banned in the United States in 1979 due to concerns about the toxicity of these chemicals. However, until that time they were incorporated in a wide range of products and materials, much of which is still in use across the country. Ongoing concerns regarding PCBs, including their persistence in the environment, have resulted in extensive regulation.

We manage PCBs and mineral oil that contains low levels of PCBs in a manner that meets or exceeds the federal Toxic Substances Control Act (TSCA) and Washington State’s stringent regulations. Our goal is to minimize risk associated with PCBs, to avoid spills or releases, and to clean up any releases to levels of non-detection.

We are also aggressively removing PCB-containing electrical equipment from its system. The vast majority of the equipment in service at Avista is non-PCB. The first wave of removal efforts, following TSCA, focused on “PCB equipment” containing 500 ppm or greater of PCBs. This type of equipment, as identified, was removed and properly disposed of during the 1980s. Rarely, through testing, we discover PCB equipment in service, and it is scheduled for removal. We have also implemented an accelerated effort to remove PCBs from our system in several ways. As equipment is replaced during system upgrades or expansions, equipment containing any level of PCBs is retired rather than retro filled. There are rare exceptions to this approach for unique equipment that we must maintain as backup; such equipment is appropriately stored.

We have implemented a sampling/testing program to determine whether some older equipment contains PCBs, where information was unavailable from the original manufacturer. As equipment is discovered to contain PCBs, immediate removal is scheduled for any items with 500 ppm or more; typically, removal is also planned for equipment containing 50 ppm or more PCBs as a precautionary measure. In addition, Avista implements targeted removal, through a process termed Serial Number Sequencing. In that effort, as testing reveals the presence of PCBs, We target for removal any other equipment that was manufactured and shipped with the tested item. In these efforts, We have worked to manage PCBs in a manner that meets or exceeds all regulatory requirements.

Percent of materials used that are recycled input materials
  2009 2008 2007
Office Recycling Programs -- Paper, Cardboard, Office Pack 78 tons 90 tons 107 tons
Office Recycling Programs -- Aluminum Cans 819 pounds 841 lbs 880 lbs
Materials Recovery -- Scrap Sold for Recycling* 973 tons 670 tons 825 tons

* These figures exclude scrap sales for transformers

Direct and indirect energy consumption by primary source
Source Fuel Equity/Control Total Units
Kettle Falls Boiler Wood 100% 274,833 tons
ColStrip Units 3 & $ Coal 15% 803,467 tons
ColStrip Units 3 & $ Oil 15% 1,499 Bbl
Rathdrum Natural gas 100% 539.63 MMscf
Northeast Natural gas 100% 0.59 MMscf
Boulder Park Natural gas 100% 259.88 MMscf
Coyote Springs II Natural gas 100% 10,696.85 MMscf
Kettle Falls CT Natural gas 100% 9.16 MMscf

Energy saved due to conservation and efficiency improvements

Avista actively practices energy conservation and efficiency in our buildings and facilities. Various conservation projects each year include replacement of heating, ventilating and air conditioning (HVAC) systems, lighting conservation, building controls, appliance replacement, motor efficiency improvements and fuel switching.

At the end of 2009, cumulative conservation at Avista's facilities totaled 3,999,557 kWh of electricity and 144,757 therms of natural gas. Conservation projects completed in 2009 achieved savings of 800,588 kWh of electricity and 55,480 natural gas therms.

We are currently replacing HVAC systems at our Spokane headquarters. The goal is to obtain LEED certification of the corporate office building and reduce annual energy costs by $224,000 per year, continuously adding to the above energy savings.

Total direct and indirect greenhouse gas emissions by weight/MWh

Note: Avista has a 15 percent ownership interest in units 3 and 4 of a coal-fired generating facility, the Colstrip Generating Project (Colstrip), located in southeastern Montana. During scheduled maintenance in March 2009, turbines in unit 4 of Colstrip, were found to be in need of major repair. These repairs extended a planned outage from March 2009 until November 2009, and impacted Avista's total greenhouse gas emissions for 2009.


Emissions Intensity Chart

Initiatives to reduce greenhouse gas emissions and reductions achieved

Avista does not currently have a specific greenhouse gas emissions reduction program in place because we are waiting for the passage of legislation at state and federal levels. Washington state has enacted greenhouse gas reduction goals, but has not passed the required legislation to implement the plan. We intend to align our program with the state and federal requirements as they take effect.

We are already avoiding associated greenhouse gas emissions through the 111 average megawatts of energy efficiency on our system. We are a member of the Chicago Climate Exchange (CCX) and have agreed to meet CCX baseline reduction goals of 6 percent by 2010 on the generation assets covered under the program. We have exceeded our CCX goals to date and anticipate exceeding our CCX goals through the end of 2010 at the conclusion of phase II of the CCX.

We have included estimated carbon costs in the Base Case of our 2007 and 2009 Integrated Resource Plans, to reflect anticipated federal climate change legislation beginning in 2012.

NOx, SOx and other significant air emissions by type and weight per MWh
Facility Fuel Type SO2 NOx Hg VOC
Kettle Falls Wood 26 180 0.004 38
ColStrip Units 3 & $ Coal 538 2,202 0.098 37
ColStrip Units 3 & $ Oil 2 1 0.000 0
Rathdrum Natural gas 0 17 - 1
Northeast Natural gas 0 0 - 0
Boulder Park Natural gas 0 3 - 10
Coyote Springs II Natural gas 3 99 - 4
Kettle Falls CT Natural gas 0 0 - 0
Totals   543 2,322 0.0988 51

*Note:all values in metric tonnes

2009 Emissions/MWh, Avista
Total Energy Electricity Generation 6,858,026 0.17 0.75 0.00003 0.02
Fossil Fuel Electricity Generation 2,914,099 0.41 1.76 0.00007 0.04

*Note: all values in lbs parameter/MWh

Total weight of waste by type and disposal method including PCBs

"RCRA waste" represents hazardous waste as defined in the Resource Conservation and Recovery Act. Avista looks for ways to reduce generation of hazardous waste and manage waste streams. The largest single source of hazardous waste is represented by aerosol cans, which are collected from throughout the company, and if suspected to be not completely empty, treated as hazardous waste. We manage all RCRA wastes in accordance with state and federal regulations. This includes, as appropriate, treatment or disposal at permitted landfill or incineration facilities.

"Non-RCRA" wastes include waste streams that are not deemed "hazardous," but which we manage as special wastes. These include waste oils, greases, antifreeze, and a range of miscellaneous wastes that can be recycled, blended into fuels, or responsibly disposed of. These are managed and disposed of in accordance to state and federal regulations.

"Universal wastes" include specific waste streams designated by federal and state law that are excluded from being treated as "hazardous" if they are managed according to specific standards. These include items such as fluorescent light bulbs. We manage all universal wastes in accordance with these standards.

In 2008, the most recently reported year, we disposed of 1.859 Kg of PCB wastes managed in accordance with the Toxics Substance Control Act (TSCA) via incineration.

Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with environmental laws and regulations

In February 2008, both combustion turbines at our Northeast Combustion Turbine (NECT) were emission tested for compliance with the air operating permit. Both units passed sulfur dioxide (SO2) and total hydrocarbons (THC) tests but failed on particulate matter (PM), carbon monoxide (CO), and nitrogen oxides (NOx). Technical reports indicate the testing was appropriate and accurate. Initial mechanical inspections of the combustion systems indicated that both units were normal, though further evaluation suggested the need for repairs.

Based on the results of the February 2008 emission tests, the Spokane Regional Clean Air Agency (SRCAA) issued Avista a $58,000 penalty. Given the excellent compliance history and little use of the NECT over the last five years (111 hours total run time), Avista requested that SRCAA rescind the penalty.

SRCAA denied our request to rescind the penalty. However, negotiations continued to craft a new permit for the facility and settle the penalty. Avista completed the recommended repairs by Pratt-Whitney and the units were re-tested in August 2008. Minor improvements were noted in the emissions. We were seeking a minimum number of plant operating hours to meet reserve requirements and peak energy needs. The SRCAA wanted even fewer hours of operation or wanted Avista to install additional emission controls.

Through ongoing negotiations, all new permit conditions were resolved, and the new permit was issued April 3, 2009. An agreement was reached regarding the penalty and Avista paid $37,000 of the original $58,000 penalty.

Significant environmental impacts of transporting products used for operations and workforce

Commute Trip Reduction

Washington's Commute Trip Reduction (CTR) law (RCW 7094.521) was adopted by the legislature in 1991 and incorporated into the Washington Clean Air Act. Its purpose is to improve air quality, reduce traffic congestion, and minimize energy consumption by encouraging employees to use alternative commuting methods rather than driving alone. The law requires employers with more than 100 employees at a single worksite, in counties with 150,000 or more residents, to promote commute alternatives such as buses, carpools, vanpools, bicycle riding, walking, working from home, compressed work weeks and flexible work schedules.

The purpose of Avista's Commute Trip Reduction Program is to educate and encourage employees to make informed decisions about reducing their carbon footprint by reducing their "drive alone" miles. This also demonstrates Avista's commitment to complying with the Clean Air Act and reducing automotive pollution and energy consumption.

Avista Employee Commute Trip Reduction Impacts
2009 2008 2007
Miles Eliminated 152,714 162,517 86,989
CO2 Prevented (Pounds) 8,401 8,939 4,784

Green Fleet

Avista's green fleet initiative aims to improve productivity by streamlining costs and reducing our carbon footprint. Our effort is part of our long-standing culture of being good stewards of resources. By adopting clean fleet practices and cleaner forms of transportation, we intend to be more efficient and provide a safer, healthier working environment.

The green fleet strategy focuses on activities within the following areas:

  1. Maintaining company vehicles to maximize efficiency, eliminating the unnecessary use of inefficient vehicles, and purchasing and using the "right-sized" vehicle for a particular job or service.
  2. Adopting green vehicle purchasing practices that include the use of cleaner fuels and technologies, including biodiesel, gas-electric hybrid vehicles, propane and natural gas-fueled vehicles, and electric-hybrid conversions.
  3. Educating employees to drive fewer and more efficient miles, use the most efficient vehicle to perform the job, and reduce unnecessary idling time.

In 2009 we reduced our fleet emissions by 247 (Metric Tons CO2e). We also began testing the use of locally produced biodiesel in five of our fleet vehicles.

Allocation of CO2 emissions allowances or equivalent for carbon trading framework

Avista is not currently obligated by any federal or state regulatory agencies to provide or purchase allowances for a carbon trading network.

We are a member of the Chicago Climate Exchange and based on preliminary estimates we expect to receive surplus credits for the 2009 compliance year. Compliance documentation for 2009 is not due until April 30, 2010 and completion of the verification audit by FINRA is expected by September 30, 2010.

We will be required to submit our first greenhouse gas emissions reporting to the Washington Department of Ecology for 2009 in October 2010. Mandatory greenhouse gas emissions reporting to EPA starts in 2010 for the reporting year 2010. Avista has a greenhouse gas reporting plan in place to meet these requirements.