August 31, 2013
Alaska

Owner of Delta wind farm files complaint against GVEA

Matt Buxton | Fairbanks Daily News-Miner | August 29, 2013 | www.newsminer.com

FAIRBANKS – After feuds over buying and selling wind-generated electricity, the owner of a Delta wind farm has filed a complaint against the Golden Valley Electric Association.

In a press release Wednesday, Alaska Environmental Power announced that it has filed an informal complaint with the Regulatory Commission of Alaska as a last resort after failing to reach an agreement to sell 25 megawatts to the electric utility cooperative.

The wind farm, owned by Mike Craft, produces and sells less than 2 megawatts of electricity to GVEA, but has plans to build more turbines to hit the 25 megawatt goal. The release said GVEA is “violating its legal duty to open its transmission system to small and independent producers of renewable energy.”

“GVEA was not serious about the negotiations and presented terms so unreasonable that it was essentially just another way of turning us down,” he said in the news release. “We are filing this complaint with the hope that the RCA will tell GVEA that its actions are unlawful and that it should start negotiating with AEP in good faith.”

GVEA CEO Corey Borgeson contested Craft’s claim that GVEA is unwilling to negotiate.

“GVEA has spent thousands of dollars on legal and engineering costs responding to and analyzing AEP’s proposal,” he said. “We’ve never stopped negotiating and are willing to meet with AEP at any time.”

He said, instead, that he believes Craft is unhappy with the price GVEA has offered for electricity.

The press release said the Delta wind farm will save consumers money by displacing expensive diesel or coal power, but Borgeson said it’s not that simple.

Because wind can fluctuate, the utility has to have some other power plant ready to replace it. Coal is slow to power up, so GVEA’s only current option is to replace it with diesel-fired plants, which are also the costliest to operate.

“There’s a cost of regulating wind. … When the wind and the turbines are spinning, we get 24 megawatts, but when the wind stops within a few minutes we get nothing,” he said. “We have to throttle up the turbines, otherwise we’re going to put people in the dark.”

The GVEA grid already includes up to 25 megawatts of wind power produced by the Eva Creek wind farm, a sizable chunk of the entire system’s average demand of between 150 and 160

GVEA has recently filed to establish a standard rate to purchase any wind electricity that factors in the costs of idling the turbines. Borgeson said the company is interested in getting more wind into its system, but that it won’t do so if it will cost customers more.

“We cannot enter into an agreement that is not in the best interest of our members,” he said. “We would welcome the wind, it just cannot economically harm our members.”

Craft contends that his plant could save the community as much as $4 million annually and could help address Fairbanks’ air pollution.

“It’s frustrating to see longtime community members and businesses contemplating leaving Fairbanks because of sky high energy costs and terrible air pollution conditions, especially when we have a project ready to go that could improve the situation,” he said in the news release.