Wind farm owners ask federal agency to intervene in curtailment dispute with Bonneville Power Administration
Wind farm owners stepped up their fight with the Bonneville Power Administration on Monday, asking federal energy regulators to halt the agency’s new policy of curtailing wind generation in the region when it has excess hydroelectric power to sell.
Awash in a near-record spring runoff, BPA has been intermittently cutting off scheduled transmission for wind farms in its control area – effectively shutting them down – since May 18.
Wind farm owners say the federal power marketing agency is using its monopoly position in the transmission market to illegally favor its own generation and customers.
The agency sells power from 31 hydroelectric dams in the Columbia River Basin and controls three-quarters of the region’s high-voltage transmission grid. During off-peak hours this spring, the dams have been generating more power than customers in the region need, and BPA has limited flexibility to curtail hydro operations because spilling more water increases dissolved gas in the river to levels that harm fish.
With coal, natural gas and nuclear plants in this region already running at minimal levels and California dealing with its own hydro surplus, the agency says it has no place to put all the wind and water energy. BPA says the situation could threaten grid reliability, leaving it with no choice but to temporarily cancel transmission from the region’s growing fleet of wind farms and substitute free hydropower for the scheduled deliveries.
Wind farm owners, including independent developers and utilities who own their own projects, say the problem is about money, not too much electricity.
“The agency has painted this issue as being about fish and physics,” said Stefan Bird, senior vice president at PacifiCorp Energy. “It’s about discrimination and dollars.”
Bird said BPA’s right to curtail transmission for reliability reasons is not in dispute. But wind farm owners contend there is adequate demand and transmission capacity to send power to California if BPA paid utilities there to shut off their own power plants, a situation known as negative pricing. They believe that full compensation for curtailments should include not just substitute power, but the value of foregone tax and renewable energy credits that are only generated when wind turbine blades are spinning and delivering power to the grid.
BPA has refused to pay negative prices as it says doing so would shift costs for exporting wind energy to the 140 publicly owned utilities who buy power from the agency.
BPA is already participating in a FERC-sponsored mediation with the companies in an attempt to resolve the dispute.
“We’re disappointed that the filing proceeded because we think (the mediation) could be a worthy effort,” said BPA spokesman Doug Johnson. “We’re committed to exploring solutions but not moving away from what we believe is the best way this spring in facing the realtime conditions.”
PacifiCorp joined Iberdrola Renewables, Next Era Energy Resources, Invenergy Wind North America and Horizon Wind Energy in filing the complaint with the Federal Energy Regulatory Commission.
The companies have asked FERC to expedite a decision forcing BPA to cease wind curtailments and honor its contracts. They also asked FERC to require the agency to file a non-discriminatory transmission agreement at FERC within 120 days.
“It’s an issue that FERC can act on quickly,” said Bird. “Fundamentally, what we’re asking is to uphold the integrity of transmission contracts and let the market decide when generation should be curtailed, which happens through price signals, including negative prices.”
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