United States

United States

Wind critically overpriced

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In a finding with potential national implications, a respected environmental group recently discovered that southern California wind is significantly over-priced in a vital California state policy document. The discovery means that wind is not being recommended by state and regulatory officials as often as it should be, and that instead other technologies such as natural gas-fired re-powering are put forward.

Officials at the Environmental Defence Fund (EDF) found that wind is two-thirds undervalued based on its capacity factor in the Electricity Report of 1992. The biennial document is used to forge state energy policy -- by forecasting electricity consumption and by telling utilities which is the best method of generating power. California is looked to by other states for its wind expertise.

The capacity factor used in the document in southern California was 17.5% instead of the 24% recommended for wind by the state's own California Energy Commission. And if bad data is pumped into the production cost model used by the state -- called Elfin -- the wrong answer is given. "Once you correct the errors and add in the (new) tax credit, models start choosing wind," says Francis Chapman of EDF, one of two officials who first discovered the state's error. Chapman says the under-valuation was found in the data sets of Southern California Edison and the Los Angeles Department of Water and Power, who are now working with EDF on the matter. The mistake will be corrected in the 1994 Electricity Report, to be released in January 1995, says Chapman. A draft will be issued in June. As a result of the finding, South Coast Air Quality Management District staff are now proposing more use of renewables than they had done previously.

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