Idaho Power is exploring options to invest in wind power with extra money from the sale of federal sulphur dioxide (SO2) emission allowances that the company has no need for.
The money is available mainly because 44% of the utility's generation comes from 17 non-polluting hydropower plants, a situation which, depending on yearly snow pack, often creates sizeable leftover allowances under the national SO2 cap and trade program. In 2006, Idaho Power used 90% of its $69 million in allowances to reduce rates for its Idaho and Oregon customers. The remaining 10% went back to stockholders. The company's three options for this year are to continue with the 90/10 split, purchase renewable energy credits or invest in a wind project. Idaho Power will have about 120 MW of wind power on its system by the summer -- about 100 MW of which will come from Horizon Wind Energy's project in LaGrande, Oregon. But Idaho Power is interested in developing a wind project of its own. The plan could cost ratepayers more initially but is likely to save money over the long haul. "We want to build a wind project so that we will have quantifiable data as to what it takes to integrate wind into our system -- how you support it, how you back it up and what sort of resources are required," says Idaho Power's Dennis Lopez. Last month a community workshop to assess customer preferences for the leftover federal allowances provided little new direction and Lopez says the Idaho Public Utilities Commission is likely to determine the course Idaho Power should follow in coming weeks. Idaho Power has nearly a million customers in southern Idaho and eastern Oregon.