Rate increases temper wind energy development 

An online survey by Southern Power District has revealed that customers are a little hesitant about wind power, especially if it involves a rate increase on their monthly electrical bill.

“Through this survey we have learned that, with the rate increase imposed upon them, our customers want all of our actions to be sensible,” said LeAnne Doose of Southern Power District.

The survey revealed that recent rate increases implemented by Southern Power District to help pay for the extensive ice storm damage caused to the district’s infrastructure last year has influenced customers’ thinking about wind power, especially if it results in another rate increase.

The survey had three questions. The first question asked if respondents believe, given the description of the Nebraska Public Power District’s decision on wind development and the resulting increase in rates, that NPPD acted in their best interest?

Doose said 68.3 percent responding to the survey said no, while 31.3 answered yes.

She said the SPD board agreed with the respondents and would have liked to see NPPD delay its decision on wind power until it had completed its Integrated Resources Plan (IRP) and determined the type of power generation resources and energy efficiency/conservation measures that would be needed to meet future growth in electricity usage.

NPPD will be conducting meetings open to the public to explain the IRP, which covers a 20-year planning period from 2008 to 2027, and take comment on the draft plan that has been proposed.

Among the meetings will be one at 6:30 p.m. Feb. 29 at the Holiday Inn Express in Kearney

The IRP provides a strategic framework and plan for future energy resource decisions by NPPD through 2027.

“We thought having the IRP completed would have been a very useful tool to determine how much they needed to develop wind power,” Doose said. “We thought making that decision prior to that was premature. We just had a 12-percent rate increase and we will have another big one next year. The idea to jump into things like this when we are already faced with increasing costs is a real hard one for people to understand.”

The second survey question asked whether respondents believe a 1 percent increase in retail rates is appropriate to develop wind generation under these circumstances?

Doose said those answering the survey were split evenly at 50/50.

The third question asked what position Southern should take in regard to development of wind generation and renewable electric generation to best represent the customers’ interests.

According to the results:

* Do not support at any price, if more generation not needed at this time: 24.49 percent.

* Do not support wind development under any circumstances: 4.08 percent.

* Support only if it will not increase rates: 22.45 percent.

* Support up to a 5-percent increase in electric rates: 24.49 percent.

* Support if the increase is not more than 1 percent: 24.49 percent.

According to Doose, the survey revealed that a majority of Southern’s customers felt NPPD’s action to approve privately developed wind projects was not in their best interests.

However, she said, the opinions were split on implementing a 1-percent rate increase to support wind development.

What customers revealed in their written explanations was that although they did not approve of the action prior to the completion of NPPD’s Integrated Resource Plan, a 1-percent increase would not be completely unacceptable.

In looking at responses to how Southern should represent its customers’ interests, Doose said it appears a majority of their customers still favor reasonable rates.

She said just under 25 percent indicated that rate increases up to 5 percent should be imposed for wind development. Many customers indicated in their written responses, Doose said, that the 12-percent rate increases the district implemented on Jan. 1 were already high enough, without the added cost of wind generation development.

She said the district will also have to implement another rate increase next to tackle the debt Southern took on to pay for the ice storm damage, which cost the district $40 million.

Doose said the survey revealed a lot of differing opinions about wind generation development.

Southern conducted the online survey on wind energy, she said, in order to get a feel of what their customers were thinking about wind energy development.

And what they found is that their customers don’t oppose wind energy development, but want to go forward in a sensible manner, Doose said.

“We really haven’t had a good opportunity to gauge our customers’ opinions on the matter since there’s so much going on out there with wind energy,” Doose said. “We wanted to get a feel what our customers felt about it.”

By Robert Pore

The Grand Island Independent

8 February 2008