Canada

Canada

MAKING STEADY HEADWAY

The general mood at the tenth anniversary conference of the Canadian Wind Energy Association (CanWEA) was optimistic. New provinces will be receiving power demonstration projects and several other projects are underway. There were more exhibiting companies than ever and the good outlook for the future was substantiated by the government's promise of continuous assistance. As wind energy has been pronounced safe, reliable, and cost competitive compared with conventional energy sources there is widespread local optimism regarding its contribution. There is now a consensus in Canada with regard to building a government-industry-environmentalists stake-holder collaborative; and studies have revealed new sites with good wind potential. Kenetech says its turbines in the large Alberta wind farms are doing fine. Utility studies show that wind power in Canada is sufficiently reliable to be regarded as "firm power" and capacity payment is now included in the contract with Kenetech.

Delegates at the tenth anniversary conference of the Canadian Wind Energy Association (CanWEA) in mid October welcomed news of the emergence of promising wind power demonstration projects in two more Canadian provinces. The conference learned that publicly owned Saskatchewan Power Corporation (SaskPower) was due to issue a request for proposals (RFP) to non utility generators (NUGs) to build a 3 MW wind farm and Canada's largest utility, Ontario Hydro, was planning a series of RFPs to acquire 100 MW of renewable capacity by 2000 (see story page 13).

Many of the 125 wind energy proponents at the conference, held in the Saskatchewan capital of Regina, expressed hope that the province will emerge as another major market for wind, following the lead of Alberta and Quebec. "Through our annual conferences around Canada, CanWEA seeks to stimulate new wind power planning and marketing in provinces like Saskatchewan," said CanWEA vice president and conference organiser Jeff Passmore.

However, others were disappointed at the small size of the Saskatchewan RFP, issued after two false starts (see page 40) "Wind power development throughout the world is well past the stage of meagre demonstrations. Three megawatts is hardly enough," said Roby Roberts of California wind plant developer Kenetech Windpower, one of 16 conference exhibitors and the main proponent of wind farms in Alberta and Quebec.

A record number of companies exhibited at the conference, and more countries were represented than ever. In an encouragingly positive written conference message, Anne McLellan, minister of Natural Resources Canada (NRCan), said wind energy is one of "the cleanest and most sustainable energy sources which can be utilised with minimal disruption to the environment. The federal government will continue to actively assist the wind energy industry to exploit market opportunities."

CanWEA president Bernard Saulnier said Canada needs much larger wind power projects, greater wind power budgets and far stronger signals from Ottawa that wind power should be implemented nationally, to reduce the prodigious "social costs" or environmental externalities, of other electricity sources, including intensive fossil fuel use in provinces like Saskatchewan, Alberta and Ontario. The opportunity to push wind into the market is especially timely in view of the ambitious national CO2 stabilisation and reduction goals to which Canada has recently committed. Wind applications are also excellent job creating mechanisms which can increase Canadian technological expertise and enhance competitiveness in the international marketplace, he added.

Cost consensus

An expert consensus emerged on the continuing fall in the price of wind energy to utilities to nearly $0.05/kWh, a rate at which independent developers can show a profit. Saulnier, John Dunlop, manager of the American Wind Energy Association's Great Plains regional office in Minnesota, Dan Juhl of New World Power and David Milborrow, technical consultant to Windpower Monthly, all agreed on this new benchmark. Wind power is now considered competitive with natural gas combustion turbines.

"The 100 MW Hydro Quebec contracts with Kenetech, scheduled for implementation by 1996, show that wind power is economically competitive and viable in Canada right now," said Saulnier. He cited India's leap in wind power described in the September 1994 issue of Windpower Monthly as a good example for Canada.

"Wind energy is indeed safe, reliable and cost competitive with conventional sources of energy in most countries of the world," added Raj Rangi, NRCan's wind technology manager. "Despite our huge wind resources, wind power in Canada has been slow to take off due to excess generating capacity and relatively cheap energy. We are optimistic about its cost competitiveness in remote communities and for some grid applications. Wind will surely be treated as one of the conventional energy sources in the near future," he said.

Local enthusiasm

Regina is nestled in the heart of Canada's wheat-growing breadbasket, some 160 km north of the US border. The agricultural co-operatives which have historically flourished in the province could become an important vehicle for sharing the benefits of wind turbines on the prairies. Doug Archer, Mayor of Regina, told the conference, which was held during "Co-op Week," that the city is committed to CO2 reduction and that wind energy can make a major contribution to humanity and the environment. Conference delegates toured the manufacturing facilities of Regina wind power firm Dutch Industries Ltd, a conference co-sponsor (see story above).

A strong contingent of SaskPower and provincial government officials voiced cautious enthusiasm over the industrial and environmental potential of the upcoming wind demonstration. "The carbon dioxide emissions from our coal stations motivate SaskPower to develop wind energy," says Roy Yeske, the utility's vice president for customer services. Yeske also indicated that SaskPower will shortly announce its long awaited grid interconnection policy, as suggested at the last CanWEA conference.

A new institution in Canada is the consensus building government-industry-environmentalist stakeholder collaborative. Such groups often target fossil fuel emissions. Mike Bournes of wind plant developer, The Chinook Project Inc (TCPI) described his participation on behalf of CanWEA in collaboratives geared to improving air quality in neighbouring Alberta, which, like Saskatchewan, relies on fossil fuels for power generation. The collaborative process consistently improves the outlook for wind and other renewable sources in the energy mix.

SaskPower engineer Ramaiah Divi described the utility's one year wind resource assessment from August 1993 to July 1994 at ten sites in south-western Saskatchewan. The study, conducted by Zephyr North of Ontario and co-funded by NRCan, identified areas with wind speeds up to 7.5 m/s and power densities up to 450 watts per square metre, confirming that the region has "good wind resource potential." A previous RFP issued by SaskPower for 10 MW of wind capacity was cancelled owing to the previous absence of detailed wind information. But the location and data from six of the ten sites which have now been measured have been designated as proprietary for two years, at the request of project proponents.

In the meantime, the influential Saskatchewan Energy Conservation and Development Authority (SECDA) in July identified a potential of 1200 MW of "easily accessible" provincial wind power capacity. "If environmental considerations are taken into account, wind rates well against coal options," and the employment impacts of wind power are as good or better than most electric options except conservation, the study concluded.

Clients satisfied says Kenetech

Conference delegates learned of the recent completion and operation of Canada's largest wind farm, at Cowley Ridge near Pincher Creek in south-western Alberta. Phases one and two, which started up within the past year (Windpower Monthly, October 1994), were described by Roberts and two Alberta-based developers: Dale Johnson of Wind Power Inc (WPI), and Mike Bourns of TCPI, a subsidiary of Nor'wester Energy Systems Ltd. The 9 MW phase one, co-developed by Kenetech and WPI, comprises 25 of Kenetech's 360 kW model 33M-VS. Phase 2 at Cowley Ridge, known as the Pe-kun-nee project, consists of 27 33M-VS turbines, totalling 9.9 MW and was co-developed by Kenetech with TCPI and the Peigan First Nation. Financing for both phases was provided by Kenetech, though Roberts said Canadian financing will be completed soon.

During a lively question period, Clarence Grebey of Kenetech defended the 33M-VS wind turbine, whose reliability is under criticism. He said the operating statistics at Cowley Ridge speak for themselves with availability currently over 90%. He affirmed that the Cowley Ridge project "is making money," and that the 33M-VS turbine is truly "the five cent US machine" claimed by the company. Kenetech's projects show a profit at purchase rates of less than US$0.05 per kilowatt-hour, although US$0.05 is an average wind energy purchase rate across the United States for the turbine, he claimed.

Grebey suggested that negative media and trade press reports are inspired by "short sellers" -- individuals seeking to influence the price of Kenetech's publicly traded stock. "However, there are now more that 300 model 33M-VS wind turbines operating in North America, compared with less than 20 just over a year ago. As with the introduction of any new technology, this ramp up has not been problem free. We anticipated and are resolving these problems and have kept our partners and investors informed. Our clients are satisfied with the performance of the machine."

Ed Sinnott, son of wind pioneer, rancher and farmer Ernie Sinnott, said leasing his land for use by about half of the Cowley Ridge turbines is like "growing the most profitable trees I could imagine." In addition to the 18.8 MW Cowley Ridge project, southwest Alberta hosts other wind turbines at agricultural sites for electricity generation and water pumping. Sinnott's sentiment was echoed by Eli Walter of Dutch Valley Produce Ltd, who has owned and operated three Danish wind turbines since 1992.

The conference also learned that nine of ten 150 kW vertical axis wind turbines built by Ontario-based Adecon Energy Systems are now operating at the company's 1.5 MW wind farm in Pincher Creek. Despite the operation of many productive Alberta wind farms, speakers regretted the lack of continuing government support and further markets in Alberta.

Wind with hydro wins capacity payments

An analyses of the importance and attractiveness of wind power to Hydro Quebec, where over 90% of electricity is generated by large hydropower installations, was reported to the conference. CanWEA estimates that wind power in Quebec could supply 150 terrawatt hours annually, equivalent to Hydro Quebec's annual energy production. Saulnier noted the natural correlation between the winter electric heating needs of Quebec and its strong winter winds. Hydro Quebec's system is unique since about 45% of its peak demand of 30,000 MW, which occurs in the winter, is due to electric heating. Utility studies show that electricity generated by wind in Quebec during the winter months would be sufficiently reliable to qualify as "firm" power. The hydroelectric capacity displaced by wind power can then be earmarked for peaking power supply. In this manner, wind power further enhances the value of hydroelectricity, explained Rangi.

Hydro Quebec has thus included a significant capacity payment in its contract with Kenetech for the firm power which the 100 MW (two 50 MW plants) projected for the Gaspe Peninsula would supply to the Hydro Quebec electricity system during the winter period. The contracted capacity for the project is 40 MW.

The correlation was analysed in a technical paper co-authored by Roger Lambert, interconnections expert in the Hydro Quebec network planning division. In a calculation of data on system wide electricity demand and local wind speed for 30 years, Lambert concluded that the real capacity value, or power value, of a wind farm on the Gaspe Peninsula could reach 1.5 times the average value the project maintains in the winter. The analysis used an average winter wind speed of 31 km/hr measured at Cap Chat and the additional power value was calculated using a model of system loss of load probability. In the case of a 108 MW wind farm ten year simulation with three hundred 360 kW turbines, the average power value obtained is 58 MW. This is larger than the 40 MW of contracted capacity which Kenetech will provide to Hydro Quebec for 100 MW of nameplate capacity.

The result of the study is already reflected in Hydro Quebec's payments for contracted capacity to independent wind power developers. The current capacity payment for Kenetech's project would average $25 per kilowatt of firm capacity, multiplied by the average capacity achieved each month, up to 52 MW, from December to March. This is 130% of the 40 MW of contracted capacity. For the entire year, a 35% capacity factor is expected.

Hydro Quebec's electricity purchase rate, including both capacity credit and energy rates, equals some $0.055/kWh, about the same rate paid by TransAlta Utilities to the Cowley Ridge wind project and others under the terms of the Alberta Small Power Research and Development Act. However, the SPRDA lacks provisions for payment for capacity credit.

More projects

The conference also learned that York-Vestas Energy Inc. of Montreal is expected to shortly sign a contract with Hydro Quebec to supply power from eight new 500 kW Vestas turbines at the site of the megawatt scale Projet Eole vertical axis wind turbine on the Gaspe Peninsula (Windpower Monthly, June 1994). However, the future of the experimental, originally 4 MW Eole, which was shutdown in 1993 due to a main bearing failure, is uncertain and will be resolved in negotiations. Repair may be too expensive, and the turbine could be dismantled and perhaps replaced with a new 1.5 MW Vestas V60 turbine when it becomes commercially available.

Another project due for installation shortly in Canada is a wind farm of 16 Kenetech turbines for Quebec's windswept Magdalen Islands in a low penetration 5 MW wind-diesel system, to earn a rate of $0.07/kWh

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