September 16, 2011
Colorado

Utilities weighing wind bids

ANDREW WINEKE, THE GAZETTE, www.gazette.com 14 September 2011

Colorado Springs Utilities is weighing 13 proposals from nine developers to build a 50-megawatt wind farm somewhere in Colorado.

Utilities will pick a winning bid by the end of the year and plans to have the new wind power up and running by the end of 2012, said John Romero, CSU’s general manager. The project would be Utilities’ first foray into wind, but it’s likely to not be the last.

“Really, the 50 megawatts is a step in the direction of our energy vision – it doesn’t get us there by itself,” Romero said.

Utilities is required by the state’s renewable portfolio standard to generate 10 percent of its power from renewables by 2020 (a standard it has already nearly met), but is currently considering setting a voluntary goal of hitting 20 percent by 2020. For-profit utilities like Xcel and Black Hills Energy are required to produce 30 percent of their power from renewables by 2020.

Romero said all of the proposed projects were inside the state, but wouldn’t say whether any of them were within El Paso County. He said cost would be the primary factor in the decision, but that having a location in El Paso County or a project that uses Colorado-made wind turbines (Vestas is the only company that manufactures turbines in the state) would also sway the decision.

“Really what we want to do is look at the cost of the project and the impact it’s going to have on our ratepayers, then we would look at local (projects) closer to home as a tiebreaker,” Romero said.

He said Utilities was considering the proposals’ technical aspects first before looking at prices, but that all of the projects were in the range CSU expected. Potential difficulties in transmitting the power to Colorado Springs could add costs to some projects.

While the 50-megawatt wind project would represent a small portion of Utilities’ 1,100-megawatt generation capacity, it would be a more substantial part of the typical 500-megawatt load at nighttime, when wind turbines produce their peak energy, said Utilities’ spokesman Dave Grossman.

Romero said 50 megawatts is big enough to give Utilities an idea of the challenges of integrating an intermittent power source like wind (turbines don’t produce power when the wind doesn’t blow) with its baseload power generation, most of which comes from coal plants.

“Coal plants aren’t made to cycle” on and off, Romero said. “When you back down your units, you get less efficiency.”

On the other hand, utilities typically sign long-term contracts for wind power – generally 20 years. That gives ratepayers protection against rising costs of coal and natural gas, Romero said. And wind is nearly as cheap as natural gas when federal subsidies are included, and is likely to be cheaper in the next two to three years.

“Kind of like a stock portfolio, you want to be diversified to the point where you’re mitigating some of that risk” of rising costs,” he said. “It’s a challenge for us, because our rates are very low. Adding renewables, the immediate impact is that it adds cost.”

Prices for wind power have dropped nearly in half in recent years as technology has improved and made turbines more efficient.

“They’re building taller towers, they’re building longer (turbine) blades, so they can capture wind at a lower speed,” Romero said.

While Utilities is in good shape with regard to the renewables targets once it adds this wind power, Romero said it would likely need to add more renewable power by 2019 to keep up the percentage as demand grows.

URL to article:  https://www.wind-watch.org/news/2011/09/16/utilities-weighing-wind-bids/