A final obstacle to a booming Idaho wind-energy industry may be close to cleared, the state’s three major utility companies indicate.
Idaho Power Co., Avista Corp. and PacifiCorp say they’re proposing a deal with wind developers that may lift a temporary restriction on the amount of energy Idaho wind farms can produce.
The deal could spawn a legitimate wind-energy industry in southern Idaho if the temporary restriction is lifted, said Gene Fadness, a spokesman for Idaho’s Public Utilities Commission, the state’s energy regulating agency. The restriction has blocked several wind producers from starting business.
“We have good reason to believe there are several projects that want to get started,” Fadness said. But he added that it’s too early to tell how many of those projects are on hold because of the restriction or how the deal could affect the fledgling industry.
The energy limitation dates back to 2005, when the PUC lowered the size of wind projects that qualify for special rates from 10 megawatts to 100 kilowatts.
One megawatt is enough to power about 650 residential homes, when the wind is blowing at capacity.
Under a federal law, utilities must accept alternative energy at a rate of about $64 per megawatt-hour. The utilities propose lifting the size restriction but cutting the rate by between $5 and $7.50 per megawatt-hour to pay for backup generation when the wind doesn’t blow.
Idaho Power Co. had originally asked the PUC to enact a moratorium on wind development because it said it was unclear how much it was costing the company to accept wind energy and provide the backup generation.
At the time, wind development was booming. The PUC size restriction effectively slowed wind development.
Since then, the three utility companies have completed studies to determine integration costs.
In a related case, Idaho Power and Cassia wind farmer Jared Grover are close to an agreement that settles who pays to link a wind farm to the utility’s grid. Idaho Power had asked Grover to foot the $60 million bill for upgrading its systems, but the recent deal cut the price tag to about $10 million.
The Grover agreement and the latest proposal to lift the size restriction means more turbines will be popping up across Magic Valley, Grover said in an interview last week.
But Fadness said turbine availability and the rising cost of steel could suck the wind from developers’ sails.
The utilities’ proposal must be approved by the PUC, and the department is welcoming comments on the issue from wind developers until July 18.
Comments are accepted at http:www.puc.idaho.gov by clicking on the “Comments and Questions” icon and by fax at 208-334-3762.
By Matt Christensen
6 July 2007
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