United States

United States

Blocks of wind now on offer in Texas -- Retail market gets going

The retail market for wind power is taking off in Texas. In the last few weeks two companies have announced they will sell electricity from wind plant, starting on June 1 when the state launches a retail pilot project. Full electricity competition is to begin in the state, a hot-bed of wind development and America's second most populous, at the beginning of next year.

Texans in the Dallas and Houston areas are already able to sign up to buy wind power. In early April, Green Mountain Energy, the largest US retailer of green electricity, started taking orders for a 100% wind power product. In addition to a $4.95 monthly fee, Green Mountain customers will pay a fixed price rate of $0.092/kWh in the service areas of TXU Electric & Gas Company (TXU) and Texas-New Mexico Power Company (TNMP), which include the cities of Dallas/Fort Worth. And those in the Houston area, customers of Reliant Energy, will pay $0.098/kWh.

"We are excited about offering Texans a simple way to purchase clean electricity and help support cleaner air," says Gillan Taddune, vice president of Green Mountain, based in Austin. "As Texans flip the switch on their lights, we hope they will consider that making electricity causes more air pollution than any other industry in the US."

The wind will be generated within the state, but it is not yet clear where. More than 800 MW in wind projects are under way in the state because of its Renewables Portfolio Standard (Windpower Monthly, April 2001). And most projects are to be completed by December 31, the deadline for eligibility for wind's federal Production Tax Credit.

Green Mountain, which has the corporate backing of giants such as oil major BP Amoco of the UK and electric utility NUON of the Netherlands, offers green power in Pennsylvania, New Jersey, Ohio and Connecticut. It also sold green electricity -- including wind power -- in California but had to pull out of the troubled market earlier this year.

Lasso the wind

Also throwing its hat into the green power ring is First Choice Power, an affiliate of TNMP, with its "Energy Ranch" product being marketed under the slogan "Lasso the wind." It will be available starting on July 1 in 100 kWh blocks. The green product will cost an extra $0.01/kWh, or $1 per block. The wind will be generated at the 278.2 MW plant on King Mountain, being developed by Britain's Renewable Energy Systems and Cielo Wind Power of Austin. Cielo will handle registration for the product. TNMP sells community based power to more than 238,000 customers in Texas and New Mexico. Several companies, including TXU and the utility AEP, are expected to enter the Texas retail market with a green electricity product.

Earth day launch

Meantime a Texas utility has just announced a new green pricing program in time for Earth day. On April 20, El Paso Electric inaugurated two Vestas 660 kW V-47 wind turbines at the El Paso Electric Hueco Mountain Wind Ranch, developed by Cielo. It is expected to provide enough energy for about 500 El Paso households who can opt to pay the utility a premium to receive green power.

"We're anxious to find out how our customers will respond to the option of purchasing renewable energy," says the utility's Eddie Rodriguez. The power will be available on a first-come, first-served basis in increments of 100 kWh.

The Texas RPS requires green credits worth about 400 MW in installed capacity to be in the marketplace by January 1, 2003. Over the next six years, construction of another 1600 MW of renewables will be required under the legislation, according to estimates.

Texas launches its Renewable Credit Trading Program, an essential part of the RPS market structure, on January 1, 2002, when full retail competition starts. The lion's share of green credits are expected to come from new wind -- and already there is no shortage of plants in the planning stages or under construction. Six other states have passed RPS legislation, mostly as part of market restructuring (Windpower Monthly, April 2000). But none have been as well structured as the Texas regulation to produce such stunning results. The Texas RPS is clear-cut. Penalties are stiff if retailers do not make the grade -- $50/MWh, or 200% of the average cost of credits traded during the year.

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