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United States

United States Northeast provides new role model

America's north eastern states are showing themselves to be some of the most progressive in the country in making sure that electricity market deregulation also makes renewable energy available to all who want it. Nearly 200 MW of wind plant could well be up and running, or contracted, in the region within the next three years. In such a populated area of the US, this amount of development is bound to boost wind's profile considerably.

With the Clinton administration's goal to "fill in the map" for wind development in America, the focus is more than ever on the areas of most immediate market potential. The northeast of the United States is among the four areas targeted in Clinton's draft plan, Wind Powering America (WPA)-and with good reason. It is not just that the first and only utility-scale project installed in the region so far, the 6 MW plant at Searsburg, Vermont, has attracted a great deal of positive pubic attention. The Northeast-New England as well as New York and states such as Pennsylvania-is a region where new wind development is already getting a boost from state restructuring policies and retail competition. A number of high-profile projects are to be installed in the Northeast US over the next few years (table next page).

Wind lobbyists also consider the region especially crucial for its potential to showcase small grid-connected wind farms in the most populated part of the country, even though more wind capacity is likely to be installed in Texas and the Midwest in the next few years. "The more of these relatively small sites that are close to urban areas, the more we can popularise wind," stresses David Wooley, the first advocate for state-level policy at the American Wind Energy Association and the staff person for AWEA's new Wind Power New York (WPNY) campaign (Windpower Monthly, June 1999).

"You can't over estimate the importance of the first ones going in the ground," he says, noting how much the Searsburg wind plant has sparked interest from the public as well as from politicians, regulators and utilities. Initially AWEA will concentrate on lobbying in New York State and New Jersey, which together have a population of more than 26 million. AWEA will then use this model of how state policies can best be structured to help wind, or how emerging organisations, such as Independent Systems Operators (ISO), should be set up, as a blueprint for lobbying in other parts of the country as state after state opens its electricity market to retail competition.

Clusters favoured

It is clusters of 5-10 MW and projects up to 30 MW that are likely to be installed in the northeast US, in contrast with the huge wind farms, sometimes as large as 100 MW, that are going in the ground in the heartland. The area's relatively dense population and existing land use is influencing the pattern of development. There is a potential for siting problems for big wind projects, both because of opposition from local residents and from those trying to protect open space or other local environmental features.

The region needs clean power-it has serious air quality problems-and it is a huge potential market of tens of millions of people. The Northeast encompasses enough areas of wind potential to meet the need, especially in the foothills and on ridge-tops of the Appalachian Range, the mountains that run from the Canadian border southwest though Pennsylvania, West Virginia and as far south as Georgia. In addition, wind advocates are pointing to the potential of offshore plants, for example, on the Atlantic Coast of the densely populated state of New Jersey. Such projects have only been built so far in Europe and the idea would be a new one for Americans.

Important too is that the northeast US is relatively liberal, especially now that the focus of wind lobbying is shifting to the state rather than the national, or federal, level of government. Federal restructuring legislation is clearly at least a year or two in the future, and federal policy-both money for research and development and for the federal Production Tax Credit-is already becoming mired in partisan electioneering.

Retail competition, spreading to more and more states, is being phased in in much of the northeast US, and so far much of the new regulations are renewables friendly. The Northeast is home to five of the seven states that currently have Renewable Portfolio Standards (RPS), whereby a portion of the electricity mix must come from renewables, and to six of the ten states that have enacted Systems Benefits Charges (SBC). These charges recognise the intrinsic value of renewables on a power system.

A near term market

In fact it is in the next one to two years that much of the restructuring funding secured for renewables will start being disbursed in various parts of the region. Wind is well positioned compared with its clean power competitors. And even when it is not, "market pull" can get projects off the ground as seen in Pennsylvania, even though pilot-restructuring funding is focused mostly on solar. Wooley, whose lobbying for environmental groups in New York helped win a $235 million fund for renewables and efficiency, estimates that 150 to 180 MW of installed wind capacity will be in the ground or committed to within three years.

New York State will see the most development in the near term, although developers working in the area acknowledge that siting is often a sensitive issue because of the density of population. Large scale wind potential in New York is estimated to be at least 5000 MW, especially in the central and western part of the state where winds sweep off the Great Lakes, says Bruce Bailey, WPNY co-chair and a leading meteorologist in the industry.

Three wind farms are in the works in New York, all of which are drawing on $6 million in public interest funding from a systems benefits charge. The funding, announced by the New York State Energy Research and Development Authority (NYSERDA) earlier this year, are for three years of wind projects, which must be installed by April 2001. The electricity can be sold anywhere, not just to New York consumers, significant because the state is adjacent to others that have an RPS, although it does not have an RPS itself.

One of the proposals with partial state funding is in Wyoming County. The developer, Western NY Wind Partners LLC-a California company registered on the east coast-took the project over from the utility Niagara Mohawk, which is getting out of the generation business and which would have only operated the project for five years before selling it anyway, because of a settlement with regulators over stranded debt. Vestas-American Wind Technology, the US division of the Danish turbine manufacturer, had been selected as the supplier before the project was assigned to a new developer. The size, 4.62 MW-9.24 MW, will depend upon the results of a request for proposals for a power purchase agreement, which was to have been closed in late August. Construction is expected to start in the spring, says Phillip Andres, sales manager of Vestas-American.

Also to be built with partial state funding-in this case $2 million-is the first merchant plant, in Madison County, in the central part of the state and near a transmission system. The project is being developed by PG&E Generating, an unregulated subsidiary of PG&E Corp, the San Francisco based company that owns the utility of the same name that buys wind power in California's Altamont Pass. The equipment-seven 1.65 MW turbines-will most likely again be supplied by Vestas, pending signature of a final contract, says Dan Whyte of PG&E Generating.

As of late August, PG&E Generating was finishing up its environmental due diligence studies on noise and bird risk and was hoping to get a green light from regulators in mid October. If everything goes according to plan, including the weather, the plant should be generating on the first day of the new millennium. The entire 11.55 MW project, including land acquisition, should cost $10 million. NYSERDA is also in final negotiations for a project with Enron Wind; expected to be signed in early September.

And longer term

The prospects of more SBC funding, for the next three years after this phase, apparently look good, at least for now and despite the failure of a push by the Natural Resources Defence Council (NRDC) to get $0.0005/kWh added to the charge. The political will seems to be there; it is the details that have to be hammered out. "Where there isn't an RPS, you must meet a more severe market test to make an investment decision-and we're quite bullish on this," says PG&E's Whyte. Indeed PG&E Generating, which owns 5500 MW in power plants nationally, has acquired about 40 lease options for the wind resource on farms throughout central New York.

Still, the retail market in New York has not taken off for green power providers, despite the introducton of a market incentive. The so-called "shopping credit"-the difference between a customer's default rate and the lower rate that is charged by independent power producers to attract customers-is too small to encourage people to shop around and potentially choose a new supplier. Analyses of green power buying in Pennsylvania and California have found, so far at least, that once residential customers start shopping for power they most often buy green. But the New York's set-up has not attracted green power providers to enter the market. Restructuring is still being phased in, says Wooley, and some issues still have to be worked out. For example, the state's Independent System Operator (ISO), so crucial to an intermittent source such as wind, will only get rolling in September. It is early days yet, he says, and the market is still unsettled. He predicts that another three wind farms of 20-30 MW will be installed or will be on the way within three years.

Lobbying success

In New Jersey, the other state where AWEA lobbying is focused, it now looks as if the SBC will be $15-30 million yearly for renewables for seven years, from 2000-2007. The potential is clear, although the likely level of support for renewables is now considerably smaller than the $29-35 million yearly that renewables advocates had been hoping for as recently as June. The New Jersey Board of Public Utilities and the Department of Environmental Protection are expected to make a decision by February, says Wooley, who led a group that briefed utilities, environmental groups, and state and regulatory officials on wind power in mid August. The response, he says, was so good that he expects New Jersey to become home to two or three wind projects, or proposed projects, of 20 to 30 MW over the next three years. Customers in New Jersey can actually start choosing a supplier starting on October 25, and there is discernible movement amongst towns and other groups to aggregate to buy power.

Massachusetts may see as many as 20 to 30 MW of wind development with the next three years, predicts Wooley, even though support for renewables is tied up by a lawsuit challenging the funding. A Renewable Energy Trust Fund of $150 million for renewables for five years and then $20 million yearly after that was to have started being disbursed last year. The suit, challenging the funding, should be settled sometime this year.

Public opposition

The retail market in Massachusetts, the second in New England to be opened up after tiny, densely populated Rhode Island, is still slow almost a year and a half into retail competition. The "default rate" offered to customers is below the cost of wholesale generation (Windpower Monthly, March 1999). One green product is already being offered by AllEnergy Marketing Company, which is slated to buy power from a 7.5 MW wind project in western Massachusetts developed by DisGen, or Distributed Generated Systems Inc of Evergreen, Colorado. The project, however, has hit opposition from residents in a nearby town, Hancock, a reminder of the delicacy of siting issues, especially in a scenic rather than an agricultural area.

The ridgeline site, in a skiing area in the Berkshire Hills, is within the boundaries of two communities, New Ashford and Hancock. The former approved the plan in May by a high 70% majority, but only after DisGen, headed by former US Windpower president Dale Osborn, agreed to reduce the towers from 248 feet to 200 feet (75.6-61 metres), a change that Osborn admits will harm the viability of his project. Residents were worried about aircraft warning lights required if the turbines were over 200 feet high. With plans for the project already dented, on June 1 the town of Hancock then refused to issue a building permit for the part of the project that would be within its jurisdiction. It cited in part a lack of information.

A group of local residents, who call themselves "Save Our Berkshires," are trying to get a zoning law passed to bar power generating plants within the town boundaries, as well as any tower over 75 feet (22.9 m). The tower issue, they say, is also because of the explosion of communications towers for cell phones and other technologies. "Who wants to see the Berkshires bristling with towers," the group's Phil Farnham told the local newspaper.

Hancock's planning board has now delayed taking any action on the matter until this month while Osborn is vowing to proceed with his plans, only using land in New Ashford if necessary. He is re-submitting the plan with new information. He has also said that he will appeal against Hancock's denial of a building permit at the state Building Code Appeals Board-and that the project will still be built on Brodie Mountain by next year. The outlook is unclear, though, concedes AllEnergy's Mike Tennis. "This is still an essential permit that we don't have yet," he says. "We're working very hard to build public support."

A few years ago, also in New England, a high profile wind proposal had been delayed time and time again because of local objections. To this day the wind farm, to be built in the Boundary Mountains by Kenetech Windpower, formerly US Windpower, has never been built. After Kenetech's bankruptcy, Enron Wind bought the asset, and it seems to have been put on the back burner, for a while at least. More active is a plan by Endless Energy of New Gloucester, Maine, which hopes to install 20 MW on Reddington Mountain. The project is still in pre-permitting, but since consumer choice begins in Maine next year it could go ahead in 2000, says the company's Harley Lee. He notes that FPL Energy, involved in wind development elsewhere, has bought a good deal of hydropower in Maine-a sign of its interest in the potential of the state's retail market. Endless Energy is also hoping to develop a 5 MW wind plant on Little Equinox in Vermont, but the state is the only one in New England that has yet to pass restructuring legislation to allow a market for the power.

PENNSYLVANIA WIND PLANT

Nowhere has retail choice favoured green power more than Pennsylvania, one of the East's most promising areas for wind (Windpower Monthly, March 1999). Most recently, the state reported that as of July 1, nearly 450,000 consumers-about 12% of those eligible to switch-have done so. Some 7000 MW of load is now being served by alternate suppliers, a far higher proportion of customers switching to a new supplier than in any other state. In addition, the number of "green-e" certified products has risen to five. The latest entry is "100% Renewable" from The Mack Services Group. The other green products are offered by Conectiv, and by Green Mountain.com.

A 10 MW wind farm is to be built because of the state's lively green market. The owner of the project, in Somerset County, will be American National Wind Power, an affiliate of the UK's National Wind Power, while DisGen will install it. Construction is to start this month, so the plant is on-line in January, says Ann Ryan of GreenMountain.com, which will buy the power. It has also forged an agreement with Applied Power Corporation to install and design solar systems in the Philadelphia area. More than half the 100,000 plus customers of GreenMountain.com, a green power provider, are in Pennsylvania.

The Somerset wind plant, ironically enough, will in part be sited on land reclaimed from a coal strip mine, on a ridge that ranges from 2300 feet to 2460 feet (700-750 m) with annual wind speeds of 15-16 mph (6.7-7.1 m/s). The area, in the extreme southwest of Pennsylvania, along with ridges in the West Virginia side of the state line, is considered one of the hottest. DisGen's Osborn recently told the Pittsburgh Post-Gazette newspaper that wind development in the Keystone State could grow to 200 MW, with half of this located in Somerset County. It would be especially poignant if that happens, since some of the wind plant would be installed where fossil fuel used to be mined. It would symbolise the triumph of green electricity over brown.

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