BC is one of only two Canadian provinces without any installed wind power capacity. The withdrawn 58.5 MW Holberg wind farm was scheduled to be operating this fall. The C$90 million project had a 20 year power purchase agreement with BC Hydro following the utility's 2003 call for green power.
Stothert says the joint venture partners bid on the basis of a meteorological report predicting an "outstanding resource" at the site, on the northwest coast of Vancouver Island. "We have since had five anemometer towers with hourly readings and found that the wind, although it is a favourable resource, is not as good as the meteorologist predicted. Because of that, it wasn't going to be economic at the price we bid to BC Hydro," he says.
Although the partners are walking away from the PPA, says Stothert, they are continuing to develop the project, which has completed environmental assessment and is ready for construction when it has a contract in place for its output.
Despite Holberg's problems, recent studies by ABB and Garrad Hassan have both the industry and the utility suggesting wind projects could be among the winners in BC Hydro's upcoming all-source request for proposals. In a report titled Assessment of the Energy Potential and Estimated Costs of Wind Energy in British Columbia, Garrad Hassan found BC wind developers have located 5100 MW of developable resources in three of the province's most promising wind regimes.
The wind energy consultancy, which recently opened an office in Canada, looked at more than 100 investigative use permits (IUP) issued to developers on northern Vancouver Island, the north coast and the Peace River region in BC's northeast. It applied generic turbine layouts for onshore and offshore projects, and estimated energy costs from general formulas associated with wind capacity factors, proximity to transmission and construction cost. Developers with projects in each region provided confidential real-site wind monitoring data.
The analysis found 1300 MW of developable capacity in the Peace region at a cost of C$50-85/MWh and another 1100 MW on northern Vancouver Island for which BC Hydro should expect to pay C$60-130/MWh. On BC's north coast, there is about 1200 MW of onshore potential costing C$85-110/MWh and another 1500 MW of developable offshore capacity at an estimated cost of C$100-125/MWh. The costs do not factor in the federal government's C$10/MWh wind power production incentive.
"We see wind in certain areas as being competitive in the near term, like now, for our current calls. Looking towards the future, some of the more expensive wind we see as having significant potential probably in the next five years or so," says Mary Hemmingsen, BC Hydro's manager of power planning.
The utility plans to release an all-source request for proposals (RFP) shortly seeking 800 GWh a year of firm energy, bid on a monthly basis, 800 GWh a year of associated non-firm energy calculated on an annual basis, and 200 GWh a year from small-scale projects less than 10 MW in size. It will buy any residual energy from projects at a discounted price, and has also left the door open to increasing the RFP targets to make up for its cancellation of the controversial 252 MW Duke Point gas-fired project on Vancouver Island in June.
BC Hydro will pay a premium for winter energy, giving wind an advantage over summer peaking fuels like small hydro, which has dominated past calls for green power in BC. The utility is proposing a $3/MWh credit for a project's green attributes.
Although the structure is not ideal, it should allow some wind projects to compete, says Ron Percival, president of Earth First Energy Inc. "I think wind has an opportunity to prevail."
Hemmingsen says that after consulting with industry, BC Hydro revised some of the RFP's original terms to ensure it was not setting up artificial barriers to wind energy. All technologies, excluding nuclear, will be eligible to compete and interest among independent power producers has been strong. "It will be the resources that have the best profile to meet our needs that will win. We think there is some good potential for wind."
Percival plans to bid his company's 300 MW Dokie Wind Farm and 100 MW Wartenbe Wind Farm projects, both located in the Peace region, into the 2005 call and hopes that future RFPs, including one planned for 2006, will seek larger amounts of power. BC's hydro-dominated system provides the "perfect scenario for big wind development," he says.
A report prepared for the BC Transmission Corporation by ABB, found the province's 10,212 MW of hydro capacity should help mitigate any technical issues associated with integrating wind into the grid.
"Given that the province of BC is rich in hydro generation, which is typically quite versatile in load following and providing reserve capacity, it is not anticipated that the addition of wind generation to BC will raise significant technical challenges with regard to maintaining system reliability due to wind generation variability," the report says.
It warns, however, that "particular attention" needs to be paid to the integration of wind on Vancouver Island because of the possibility of losing all synchronous ties with the mainland, where most of the island's power originates. Some parts of the grid system near the north coast are similarly susceptible.