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UTILITY PULLS OUT OF COLUMBIA HILLS PORJECT, Citizens vote to buy wind but construction stymied by lobbyists

Consumers in the Pacific Northwest are firmly voting for clean power, even if they have to pay higher utility bills. Residents in Salem, the state capital of Oregon, will go completely "green" this autumn, buying all their wholesale power from green sources, wind a favourite among them. Purchases will be through the regional power grid, overseen by the federal marketing authority, Bonneville Power Administration (BPA).

But wind projects in the region are foundering -- temporarily at least -- because of the fear of possible bird kills. Among them is a 115 MW project planned by Kenetech in the Columbia Hills. In January, Portland General Electric (PGE) confirmed that it was pulling out of its 40% ownership of the first 31.5 MW phase of the proposal, for a site near Goldendale in Klickitat County. Ultimately to total 345 turbines or 115 MW, the project has been stalled for some time by legal opposition from the local chapter of the Audubon Society and from Yakama Indians -- whose appeal of the project permit was recently turned down by county officials. Construction was to have started in the fall of 1995.

Meantime, Salem Electric Cooperative has been asked by its consumers to become the first in the Pacific Northwest to use all renewable power. Most of Salem's power already comes from hydro and starting in October, the remaining 7 MW (average) is to come from other renewables. BPA will propose power from different renewable sources, says Salem Electric's engineering and operations manager, Roger Kuhlman, in a five year flat rate contract with PGE.

The first projects on line, says BPA, are likely to be wind plants in Wyoming and Washington -- by California wind developer Kenetech Corp and the CARES utility consortium -- even though both these plants are facing hurdles because of avian issues, says BPA's Perry Gruber. CARES, a consortium of eight local public utility districts, is to use FloWind's AWT-26 turbines on a site adjacent to that chosen by Kenetech in the Columbia Hills.

PGE's Roxanne Bailey says the issue of bird kills in relation to the endangered bald-headed eagle and peregrine falcon came to a head in the autumn when the federal US Fish and Wildlife Service issued an opinion on the Columbia Hills project saying there would be "zero tolerance" for kills of endangered species. It agreed, however, that the wind farms would not endanger the birds' overall populations. Developers of both the Kenetech and CARES projects had sought permits for "incidental kills" of the protected birds.

This zero tolerance stance raised the possibility that PGE could face legal prosecution, says Bailey. The US Wildlife Service, in defending its decision, notes the site for the proposed wind farm has a more diverse range of raptors than anywhere else in that part of the state. BPA's Kathy Fisher also appears to agree with the possibility of legal liability or exposure for PGE. She told the Yakima Herald Republic newspaper that the wildlife agency's decision did present some legal risks.

solution sought

On February 21, PGE was, however, in negotiation with Kenetech in an attempt to find a way around the utility's perceived predicament. PGE is most likely to decide to buy power from the three-phase project rather than return to partial ownership of it, says PGE's governmental affairs representative, John Esler. Less likely is that PGE might negotiate some settlement with the federal bird authorities that allows incidental bird kills at the site or could have no involvement in the project whatsoever. However, Esler says he is optimistic about some sort of solution.

The project was planned to be on-line this fall, possibly through a power purchase agreement. PGE's Bailey admits the utility might now stay out of it altogether. Last year the utility signed a 30-year power purchase agreement for a proposed 25 MW project at Vansycle Ridge, near Pendleton in Oregon, also by Kenetech and also facing bird issues. Of this project Esler says: "It is on track, though slowed down a bit." PGE expects Kenetech to have a project permit in about a year.

Of PGE's experience with kills of endangered birds by power lines throughout its territory, Bailey says she can only recall one such kill, of an osprey, in her seven years with the utility. PGE and PacifiCorp, the Portland-based parent of Pacific Power, were to have been joint owners of the Klickitat project.

While wind developers continue to grapple with bird issues, Oregon citizens seem to be in little doubt about where they want their electricity to come from. In deciding to go green, the small Salem utility surveyed its 14,500 customers in west Salem and Kezler last year about their willingness to pay more for renewables -- and found to its surprise that 80% said they would be willing to pay up to 4% more in their electricity bills if it meant investing in long term clean energy to replace the power they buy from nuclear, coal fired plants and natural gas.

BPA will charge Salem Electric $0.027/kWh as its basic power rate and $0.035/kWh for wind power. But the Salem utility is apparently going to increase its own charges as the new basic rate is about 9% less than the current rate, which will help offset the higher cost wind power.

The green plan, announced in late January, drew plaudits from The Oregonian newspaper in the state's largest city Portland. An editorial entitled "Green Power Makes Sense" said utilities should start educating their customers of the costs of being too dependent on fossil fuels or Canadian natural gas, which might become far more costly next century. The newspaper praised Salem for becoming the first utility to take up BPA's five-year green power offering; this reduces the risk for utilities deciding to buy green by ensuring a supply of power to the utilities if the renewable plants are not operating.

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