Blending wind into = electric grid comes with a price - Breaking News Updates from Portland = and Oregon - The Oregonian

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Blending wind into electric grid comes with a price

Posted by Gail=20 Kinsey Hill, The Oregonian March 28, 2008 18:22PM

Categories: Breaking = News,=20 Business, = Environment=

For more than a year, the Bonneville=20 Power Administration has tried to put a pricetag on the flightiness = of wind.=20

Earlier this week, the federal power marketer settled on a figure: 68 = cents a=20 kilowatt month or $2.82 a megawatt hour.

Those are numbers only energy wonks could love. But, they're = significant=20 because they identify for the first time the so-called "integration" = costs of=20 wind and because, eventually, they'll work their way onto the monthly = bills of=20 electric utility customers.

The price-setting=20 also speaks to the rapid growth of wind energy in the Northwest and the=20 challenges tied to a clean but quirky resource.

Essentially, the fee represents the short-term costs associated with = blending=20 wind-generated electricity with other resources -- hydro-power, for = example --=20 so that the power flows steadily through the grid.

"We tried to price it right," said Elliot Mainzer, BPA's manager of=20 transmission policy and strategy.

The fee goes into effect in October, and it will be paid by all the = companies=20 that generate wind in the Columbia River Gorge. That includes utilities = Portland=20 General Electric and Pacific Power and developers PPM Energy and Horizon = Wind=20 Energy.

Utility customers won't immediately feel a pinch.

PG= E,=20 Oregon's largest utility, said the fee has been rolled into a rate = request=20 currently under review by state regulators.

The request seeks an additional $146 million annually from ratepayers = -- an=20 8.9 percent increase on an average residential customer's monthly bill. = A little=20 more than one-third of that increase involves higher power costs. And = just a=20 fraction of that amount is attributable to BPA's wind-blending services, = said=20 PGE spokesman Steve Corson.

Any increase approved by regulators will go into effect in January = 2009.

About 4 percent of PGE's power comes from wind resources. The utility = owns=20 the Biglow Canyon wind farm in Sherman County and buys power from two = other=20 projects in the Gorge.

Generally wind-energy in the Gorge sells for about $70 a megawatt = hour, more=20 than coal or hydro but increasingly competitive with power from natural=20 gas-fired plants. Add BPA's integration services and the price rises by = $2.82 a=20 megawatt hour, or 4 percent.

Earlier this decade, only a few wind farms produced power in the = windy=20 corridor stretching east from Hood River. Today, more than 1,600 turbines = rise from=20 that area, and hundreds more are under development.

The generating capacity of these turbines has hit 1,400 megawatts. In = 10=20 years, capacity could rise to 6,000 megawatts, enough to light up two = Seattles=20 full time.

But those numbers need to be used carefully. A wind turbine is = different than=20 a coal- or natural gas-fired plant, or even a hydro-electric dam. It = can't=20 produce a steady flow of energy, and it can't be turned on and off at = will.

Adjusting for wind's variablity, a wind turbine over time produces = about=20 one-third the electricity of a traditional power plant.

The task of integrating the power generation into the system has = fallen=20 primarily to BPA because the wind farms lie within BPA's service = territory. The=20 agency owns the high voltage transmission lines that the turbines must = hook=20 into, and it controls the hydro-power along the Gorge's Columbia River. =

Hydro, then, has become wind's complement. When the winds blow = strong, BPA=20 cuts back on the output from its hydro turbines, and when breezes calm, = the=20 agency pushes hydro into higher gear.

It's a complex task, and the difficulties -- and costs -- increase as = more=20 wind comes online.

Until now, BPA's customers -- the public utilities in the Northwest = -- have=20 paid for these blending costs. But most of the wind-power goes = elsewhere, to=20 investor-owned utilities PGE, Pacific and Puget Sound Energy and south, = into=20 California.

Now that so much wind is coming onto the system, the costs need to be = apportioned fairly, BPA's Mainzer said.

Mainzer also expects the costs to serve as a signal to other power = producers,=20 who might want to blend wind with other resources such as natural gas- = or=20 coal-fired plants.

"We don't want to overcharge or get irrational," he said. "We want to = be=20 fair; it's an issue of cost recovery."
--Gail Kinsey Hill; = gailhill@news.oregonian.com

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COMMENTS (1)Post=20 a comment

Posted by heyaBadger on 03/28/08=20 at 11:44PM

Although Wind Energy is promoted as being clean renewable energy, the = fact is=20 it has as many downsides as any other form of industrial scale energy = source.=20 Did you know that wind turbines cannot operate unless they are connected = to a=20 power plant? They often draw more energy than they produce. The saddest = thing of=20 all is that they kill far more birds and bats than the wind developers = will=20 admit to. The windest places are also our avian fly-ways. The thing I = most=20 dislike about industrial scale wind farms is they keep us all hooked on = the=20 grid, when on-site energy generation and independence should be the = goal. An=20 on-site small wind turbine that feeds into your home directly is much = better=20 than the ones that are 41 stories tall, but the power companies don't = want you=20 to know this. They also don't want you to look deeper into the "green = credits"=20 also knows and "carbon offset credits" developed by ENRON! This is funny = money=20 that allows polluters to keep polluting. There are much better renewable = energy=20 resources besides wind energy, but industrial scale wind turbines are = the only=20 way big power companies can continue to turn a profit. These are not the = Green=20 Santa we all hoped they would be. Visit windaction.org and see what I'm = talking=20 about. Some call them the SUVs of renewable energy! I didn't want to = believe it=20 at first but nowI'm inclined to agree. I wish those things were magic, = but when=20 you get machines that big which spin (tip speed is 100=3D120 mph) in our = nations=20 flyways and migration corridors, something bad is going to happen. It = already is=20 happening. There are much better renewable energy options, but none that = have=20 the kind of big tax breaks and lobbyists and power companies behind them = as=20 wind.

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Blending wind into electric grid comes with a price

Posted by Gail=20 Kinsey Hill, The Oregonian March 28, 2008 18:22PM

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