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Hydropower oversupply to cost wind less than feared

UNITED STATES: The short-term cost of curtailment in the Pacific Northwest is less than anticipated. But the bigger impact will be in the longer term.

Curtailments are affecting wind farms near the Columbia Gorge in Washington state
Curtailments are affecting wind farms near the Columbia Gorge in Washington state

Wind curtailments in the Pacific Northwest may cost wind operators $10 million this year rather than the $50 million that
had previously been feared, according to regional trade group Renewable Northwest Project.

But the bigger cost to wind operators is longer term, said Rachel Shimshak, the group’s executive director. The policy by Bonneville Power Administration (BPA) to curtail wind due to oversupply of hydropower sends a negative signal to potential investors, she said. "The amount of uncertainty and risk posed by BPA’s actions may cause developers to locate their projects elsewhere and, with them, all of the potential local economic development and jobs."

Curtailments of the region’s wind output, still ongoing in mid-July, were expected to end later in the summer after unusually large amounts of melting snow from the mountains has worked its way through the dams. Hydro provides most of the region’s power and this year has vastly oversupplied the region. As of 13 July, a total of 97,557MWh of wind had been curtailed — 6.1% of the scheduled output — said BPA spokesman Doug Johnson.

Operators said the curtailments may force them to breach their contracts with buyers, who cannot get renewable-energy certificates because they are not receiving wind power. BPA is providing free hydro to wind operators’ customers instead of the curtailed wind, but hydro does not qualify for the certificates. Wind operators must also forfeit the production-tax credit as it only accrues if power is generated.

Outdated market

The curtailments began in mid-May. As well as excess hydropower, the region also suffers from a lack of wind integration and an outdated power market. The problem has arisen during the windiest season in the Columbia Gorge, the region’s main wind-resource area.

BP Wind Energy North America is now supporting the complaint by five major wind operators to the Federal Energy Regulatory Commission (Ferc). BP claims BPA’s policy violates the Federal Power Act and "unduly discriminates against wind generators and results in preferential treatment of one class of customers over another". Critics say that BPA is favouring public-power districts, which BPA says would have to bear higher costs were wind operators paid to curtail.

The Ferc complaint was filed by Horizon Wind Energy (now EDP Renewables), Iberdrola Renewables, Invenergy Wind North America, NextEra Energy Resources and PacifiCorp. BPA say the curtailments have been inevitable and legal.
BPA said it is trying to solve the region’s bottleneck as fast as it can. It is proposing two transmission-line upgrades in Washington state and Montana, which it says will ease power balancing in the region. Along with four high-voltage lines already under construction or consideration, the upgrades would deliver power from another 3.2GW of electricity, including 1.9GW of wind.

In the Columbia Gorge area, winds blow strongest at night. "More geographic diversity in wind projects could make balancing easier," said Brian Silverstein, senior vice-president of BPA Transmission Services.

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