A contract dispute with a wind energy developer has Rocky Mountain Power seeking a change in the rules governing small-scale renewable power projects.
The utility, a division of Portland, Ore.-based PacifiCorp, recently submitted a proposal to the Wyoming Public Service Commission to amend a Schedule 38, which governs how much the utility pays renewable power producers.
The proposed amendment was prompted by contentious contract negotiations between Rocky Mountain Power and Wasatch Wind. The Park City, Utah, wind developer is seeking to strike a deal with the utility to buy the electricity produced by Pioneer Wind Park, a proposed 46-turbine development near Glenrock.
Wasatch took Rocky Mountain Power to the Federal Regulatory Commission last year, saying the utility offered the wind farm a contract that violated federal law.
The commission ruled that the utility could not turn off power from the wind farm, a provision initially sought by Rocky Mountain Power in negotiations.
Still, utility officials found something to like in the federal ruling. In their filing with the Public Service Commission, Rocky Mountain Power officials argued that in its ruling, FERC offered a blueprint for a different type of contract.
Under the different contract, the company would offer producers like Wasatch two prices, a higher price where new transmission lines are built and a lower one where new lines are not constructed.
The proposal comes down to two factors: federal law and transmission capacity.
Utilities are required by a law from 1978 to accept electricity generated by renewable-power projects of less than 100 megawatts. Pioneer would generate 80 megawatts.
But the law comes with a hitch. Utilities are required to purchase the power only if doing so doesn’t lead to a rate increase for consumers.
Current limitations in transmission capacity mean Rocky Mountain Power cannot offer Wasatch a higher price without triggering a rate increase, utility officials wrote in their filing with the Public Service Commission. However, they could offer a better price if a new line is built and the current constraints are eased, they argued.
Rocky Mountain Power is in the process of permitting Gateway West, a 488-mile transmission line running from near Glenrock to Downey, Idaho. The company expects the line to become operational sometime between 2019 and 2024.
“Right now there are constraints because that additional (transmission) capacity is not yet built,” said Rocky Mountain Power spokesman David Eskelsen. “We think we can construct an agreement with Wasatch and any other qualifying facility in similar circumstances that satisfies the federal law… and the federal requirement that it be neutral to customers.”
The proposed amendment was sparked by the company’s negotiations with Wasatch but would also apply to other small-scale renewable power projects, Eskelsen said.
Wasatch agrees Rocky Mountain Power faces transmission constraints, Christine Mikell, the company’s president, wrote in an email to the Star-Tribune.
“That aside, based on public filings, PacifiCorp has the ability to allow for wind energy to access available transmission from Eastern Wyoming,” Mikell wrote. “Furthermore, PacifiCorp recently installed scrubbers on its Dave Johnston coal plant to meet certain environmental requirements. These scrubbers use more energy in a year than Pioneer could ever produce. From our perspective, yes, the current line has space for power from Pioneer.”
Neither side gave any indication of what impacts the proposed amendment has on its negotiations.
Rocky Mountain Power first applied to amend its Schedule 38 in October, prior to FERC’s ruling. It submitted an amended application in January after the federal board ruled that the utility could not curtail the wind farm’s power.
The Public Service Commission will hold a public hearing on the amendment in April. Chris Petrie, a spokesman for the commission, said the application will hinge on whether the proposed changes meet the 1978 law’s requirement that ratepayers not be affected by the deal.
Pioneer Wind Park has been the subject of considerable controversy in Converse County. Some residents favor its construction on the grounds that it would create jobs and provide a clean source of electricity.
Opponents, led by the Northern Laramie Range Alliance, a citizens’ group, argue it will increase rates and industrialize a pristine landscape.
The wind farm has survived several lawsuits seeking to derail it, but Wasatch now faces a May deadline with state regulators to prove the project is financially viable.
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