BPA pulls back on plan to shut off wind

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The Bonneville Power Administration is anticipating power oversupply due to high spring runoff.

The Bonneville Power Administration has put the breaks on a plan to halt energy production from wind farms when water levels in the federal hydropower system are high.

Opponents to the plan, including Sen. Jeff Merkley and Rep. Earl Blumenauer, Oregon democrats, say it has the power to upend renewable energy development in the Northwest and unfairly discriminates against wind-energy generators.

Though the plan is intended in part to help BPA comply with laws that protect endangered salmon and steelhead, environmental groups counter that it does not.

Some of Oregon's biggest wind developers — Horizon Wind Energy, Iberdrola Renewables and enXco — also say the plan protects BPA's revenues at the expense of wind energy developers, violates contracts and runs afoul of laws guaranteeing equal access to transmission facilities.

“I think the impact on a regional consumer is that it sends a very negative signal and creates uncertainty about locating renewable energy projects in the region. That has a negative economic impact, a negative environmental impact and a negative diversity impact,” said Rachel Shimshak, executive director of Renewable Northwest Project (Shimshak weighed in on the issue last month in a column for Sustainable Business Oregon.)

The plan was proposed by BPA Feb. 18. It is designed to address a power phenomenon known as over-generation, which occurs when spring runoff is surging through the Federal Columbia River Power System, putting more hydropower on the grid than energy consumers can use.

BPA is charged with managing the power supply to meet demand, which keeps energy prices stable. That means the agency must find ways to slow energy production or curtail it when there is more power produced than can be sold.

In its proposed plan, BPA spells out how, in the event of heavy water flow in the hydropower system, it will lower power production at federal dams by storing water, then ask thermal producers — natural gas, nuclear and coal producers — to power down. But BPA is also proposing to rewrite its contracts with wind energy producers so wind farms can be taken offline as well.

The plan followed an event in June 2010 that demonstrated BPA's difficulty in managing over-generation since the addition of nearly 3,400 megawatt hours of wind power capacity, most of it coming online since 2005. But critics say it relies exclusively on wind to bear the pain of over-generation, and doesn't reflect national policy or growing interest among westerners in supplanting fossil-fuel-based energy with renewables.

Michael Milstein, BPA spokesman, said incentives associated with renewable energy make the balancing act difficult.

"Traditionally the thermal plants that are out there watching the market have to pay for their fuel. From an economic standpoint, if the cost of the power goes down, when it costs them more to run than it does to purchase power in the market, they have an incentive to go down," he said. Some thermal producers use the time to schedule maintenance.

By contrast, wind farms that shut down lose money, not only revenue from power sales, but from state and federal tax credits that are directly tied to production.

"The revenue incentive for the wind producers kind of changes the picture. They don't have the same incentive, so that means we have to look at other options," said Milstein.

Milstein said BPA would hold off on implementing the plan while officials review comments from stakeholders. He said BPA does intend to put some version of an over-generation plan in place in a few weeks, in time to plan for what looks to be the region's highest runoff year since 1999, a stark contrast to last year.

In its proposal, BPA argued against simply spilling water over dams and curtailing its own hydropower production, saying to do so would conflict with a mandate to protect endangered salmon and steelhead and meet water quality standards in rivers. Because the force of falling water creates air bubbles that dissolve as gas in waterways, BPA argues spilling water isn’t always an option because the gas can also harm fish and violate the Clean Water Act. Though BPA has a network of passages designed to slow the force of water spilled, the water runs through generators, which the administration says can’t be used unless there is a need for the energy they will produce.

Save Our Wild Salmon Executive Director Pat Ford, in a letter to BPA, said spilling more water would be most beneficial to young salmon and that the dissolved gases would not hurt fish. He was among a number of individuals who said BPA had not explored other options, such as selling excess power to another utility, a practice critics say is common in other parts of the nation. BPA’s proposal calls for avoiding such spending, leaving the burden to reduce power to wind producers.

In a letter to BPA, Merkley and Blumenauer noted the plan, as proposed, violates federal transmission policy because it would allow BPA to discriminate against a particular class of transmission customers to benefit its own power business.

"We are concerned that the (proposal) could cause significant problems for renewable energy development in our region and for economic development in rural counties in our states,” the letter read, noting lost power sales and eligibility for tax credits and a reluctance among utilities to buy wind power that could result if BPA is allowed to curtail it.

Lee van der Voo, lvdvoo*at*gmail.com, is a freelance writer for Sustainable Business Oregon. Her last story was on a bill that would enact a per-mileage charge for electric vehicles in Oregon.