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Funding Support from the Northwest Energy Efficiency Alliance

CWEB.077/May.31.2002


1) Northwest Utilities Nearly Double Reported Energy Savings in 2001, Preliminary Figures Show
2) BPA Set to Exceed FY 2002 ConAug Target of 60 aMW Under Contract
3) BPA Conservation, Renewables Part of Regional Dialogue for Post-2006 Federal Power
4) Major Wind Farm Proposed for Central Washington's Kittitas Valley
5) EWEB, PacifiCorp Power Marketing Announce 25-MW, 25-Year Wind Deal
6) Oregon's Capitol Building Gets Power from The Sun
7) Jean Vollum Natural Capital Center in Portland a Potential Harbinger of Built Environment
8) IPUC Approves 0.5 Percent Rate Surcharge for Idaho Power DSM
9) Avista Contracts for Two Energy-Saving Proposals from Resource Solicitation
10) Energy NewsData Marks 20th Anniversary
11) Peanut Butter Sandwiches, $500 Million and Windmills Highlight School Talk


KEEPING SCORE

Conservation Numbers Up

Northwest Utilities Nearly Double Reported
Energy Savings in 2001, Preliminary Figures Show

Pacific Northwest utilities nearly doubled their reported program energy savings in 2001 compared to 2000, reaching the highest levels since the mid-1990s, according to preliminary figures from the Northwest Power Planning Council.

This is another effect of the energy crisis, believes Council conservation manager Tom Eckman. "The fear of $3,000 a megawatt-hour power got people moving again" on energy-saving endeavors, he said. "It looks like there's a programmatic response to high prices."

The preliminary numbers gathered from regional utilities show 73 average megawatts of savings in 2001, up from 38 aMW in 2000, and the highest since 95 aMW were recorded in 1996. Total reported conservation spending amounted to $113 million, also the highest since 1996 ($154 million). The 2001 tally excludes various load-reduction ventures, such as energy buy-backs, initiated during the energy crisis.

These figures reflect data from all the region's investor-owned utilities and an estimated 90 percent of regional load served by publicly owned utilities, said economist Ken Corum of the Council's power planning division. The results are subject to change, as more utilities send information and the numbers are further scrutinized. Still, Corum said he would be "very surprised if they move 10 percent" from the preliminary figures, and they're likely to vary much less.

With the 2001 results, Northwest utility conservation acquisitions since 1978 now total about 1,400 aMW (adjusted for Bonneville Power Administration co-funding), according to Council figures.

Meanwhile, the Council has assembled a Conservation Resources Advisory Committee to assist on a host of issues. The regional planning body also has debuted a Conservation Resource Comment Database Web site, which includes details on more than 2,500 conservation and renewables measures.

2001 Numbers on The Rise

The preliminary 2001 conservation numbers reported to the Council by Northwest utilities mark the first significant year-to-year increase since 1996. Regional savings in the 1990s peaked in 1993 at 136 aMW, and have steadily declined since, going up only in 1996 and very slightly in 2000, according to a Council spreadsheet. Regional spending rose to $333 million in 1994 and, amidst a variety of factors including electric industry restructuring and lower-cost generating resources, dropped every year since, falling to $58 million in 2000.

Until 2001, that is. "People did make a push last year," said Corum. As examples he noted a plethora of regionwide compact fluorescent lamp sales (the Northwest Energy Efficiency Alliance reported 6.5 million CFL sales in 2001, compared to about 380,000 in 2000) and VendingMiser installations. These and other energy-saving ventures were especially popular among utilities exposed to high wholesale power prices, he said.

"You would expect there would be a response," said Corum. Without measures to reduce power demand, notably curtailments of aluminum smelting loads, "We might very well have had some blackouts."

The 73 aMW total program savings and the $113 million total program spending are considered unofficial. Still to be refined are such details as utility reporting of savings and spending on BPA ventures--specifically the conservation/renewables wholesale rate discount and Conservation Augmentation--and Alliance efforts. "There's the possibility of both overcounting and undercounting," said Eckman. He anticipates final regional numbers available by early summer, including information from individual utilities.

"We haven't closed the books," said Corum in early May. "We're getting some more responses and there will almost certainly be some modifications, but I'd be extremely surprised if it was as much as 10 percent."

Although the 2001 savings rose significantly from previous years, they still fell short of the slightly more than 80 aMW conservation target in the Council's fourth power plan. In each of the prior three years, regional conservation acquisitions came to less than half these targets.

The Council in January established a 300 aMW annual energy-saving target for 2002 through 2004 (see Con.WEB, Jan. 31, 2002), as an interim voluntary goal to sustain regional conservation in the midst of power market volatility.

Conservation Advisory Committee, Database

Meanwhile, as it develops its fifth power plan (a draft is tentatively due in spring 2003), the Council has convened an advisory panel for conservation. This 26-member committee met for the first time April 17, and Eckman likened it to "a high school reunion" for regional conservationists, representing "the collective wisdom of a millenium's worth of experience ... If any group can figure out what to do," this is the one, he said.

The committee will focus primarily on five areas, according to an April memo by Eckman to members: 1) evaluate conservation's future role; 2) identify barriers to developing new conservation resources; 3) recommend ways to improve the effectiveness of conservation programs and activities; 4) develop ways to overcome barriers to new conservation, "particularly as related to the need to stabilize the region's annual investment in conservation;" 5) assist the Regional Technical Forum in various conservation assessments.

At the April 17 gathering, the first agenda item covered a just-beginning Council analysis of the economic value of consistent Northwest energy-saving investments. Also recently, the Council launched a Conservation Resource Comment Database. "We'll have a continuous stream of all the public comments related to technical assessments," said Eckman.

This site includes a voluminous listing of energy-saving measures in the industrial, commercial, residential, agricultural, utility system and "other" sectors. Renewables also are covered, under the headings of unmetered generation and direct application. There are more than 2,500 items in all, according to Eckman. "This is the Council's own analysis of various things," he said, although "many of the technical assessments are identical to what went through the RTF."

For each measure, people can access varying levels of detailed information. For example, in residential lighting, a 26-watt Energy Star exterior compact fluorescent lamp is listed to last five years, save 159 kilowatt-hours annually, and have a regional cost-benefit ratio of 5.89 and a net present value regional costs and benefits of 21 cents/KWh. Links are provided to spreadsheets and assumptions used in the calculations. --Mark Ohrenschall

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BONNEVILLE POWER ADMINISTRATION

Savings Beyond

BPA Set to Exceed FY 2002 ConAug Target
of 60 aMW Under Contract

Bonneville Power Administration is set to exceed its fiscal year 2002 target for 60 average megawatts of contracted Conservation Augmentation savings, and is considering ideas for new energy-saving ventures.

BPA reports 58.4 aMW under contract through its Conservation Augmentation program as of early May, with about 9 aMW actually installed. Another 26 aMW of prospective ConAug savings are under negotiations, and "achieving that [60 aMW] target is imminent," said BPA ConAug manager Tim Scanlon. These agreed-upon savings are due within Bonneville's five-year wholesale rate period ending in 2006.

BPA energy efficiency vice president Mike Weedall attributed the ConAug performance to utility customer demand, BPA staff work and private-sector delivery. "You put that all together, and it means we've just been doing extremely well," he told a Northwest Energy Efficiency Council forum in Seattle April 23.

Weedall also reiterated Bonneville's intent to achieve at least 100 aMW of installed ConAug energy savings between FY 2002 and 2006, and 220 aMW altogether. "We're not going to slow down in the slightest with what we're doing on the conservation side," he said. Despite the agency's financial crunch from the energy crisis, which precipitated a 46-percent wholesale rate increase, "There are no discussions at BPA about cutting back on our [conservation] program commitments."

BPA's FY 2002 budget includes $40 million for ConAug, as well as $40 million for the conservation/renewables wholesale rate discount, $12 million for market transformation and $3 million for low-income weatherization. All those ventures are planned to continue at these funding levels through FY 2006.

Bonneville conservation savings average about $1.7 million to $1.8 million per average megawatt, Weedall noted, and the agency will continue trying to "do even better," he told the NEEC forum.

Meanwhile, BPA is mulling new energy-saving initiatives, specifically including loans and collaborating with property-management firms. "These are general concepts, general program ideas that we're floating to people," Weedall told Con.WEB. "People seem to be nodding their heads up and down," although, he added, "Details will take us a while to work out."

ConAug, C/RD Update

Bonneville's ConAug program encompasses eight different initiatives, all designed to deliver energy savings to the federal power marketing agency.

The flagship effort under the ConAug umbrella is Invitation to Reduce Load through Conservation (IRLC). For FY 2002 through early May, BPA had signed 27 proposals with 13 customers for a total of 22 aMW, Scanlon said. Ten additional proposals recently were submitted for about 20 aMW of savings. "The momentum on this program continues to amaze us because it doesn't appear to be flattening out," he said.

Also under ConAug, BPA includes contracted savings to date for lighting coupon rebates, a limited standard offer for commercial lighting and for commercial/industrial programs, VendingMiser, Northwest federal hydropower facilities, other federal facilities, and water/wastewater treatment facilities through BacGen BioWise technology.

Altogether, through early May, these total 58.4 aMW of contracted savings since ConAug began in earnest midway through FY 2001, Scanlon said. Average cost is about $1.4 million to $1.5 million per average megawatt.

A total of 9 aMW of these ConAug savings had been delivered as of early May, and Weedall said BPA is "on target" to meet its 25 aMW goal by Sept. 30.

"There continues to be interest and demand for conservation in the wake of the [energy crisis] craziness last year," he said. "I also have to think that ... retail customers are interested in conservation because of the price signals they're getting."

Weedall also praised the work of BPA staffers in developing programs that "meet the customer's need. If we weren't meeting a need, we wouldn't have people sign up."

Meanwhile, BPA is soliciting utility opinions on both ConAug and the C/RD. "It's another way we want to make sure we're listening to customers, giving them a chance to have input into the process," Weedall said.

BPA officials are reviewing ConAug comments aired at nearly a dozen customer forums around the region earlier this spring, Scanlon said. Any program changes should be made known by mid-August and take effect at the beginning of FY 2003.

Meanwhile, upcoming C/RD meetings are scheduled for Spokane (June 5), the Tri-Cities area of Washington (June 6), Salem, OR (June 6) and the Puget Sound area the week beginning June 10, according to C/RD program manager Mark Johnson. Comments are due to BPA by June 14. (Contact Johnson for more information: phone, (503) 230-7669; e-mail, mejohnson@bpa.gov.) BPA plans to have its responses by July 1, followed by a 30-day public comment period and two public meetings. Any program changes should be made by mid-August, he said.

New Program Ideas

BPA also is reaching out around the Northwest on prospective new energy-saving ventures. "We want to make sure that we're looking at all the options that are available to deliver conservation as cost-effectively as possible," said Weedall.

He outlined two specific possibilities, one focusing on residential loans and another targeting property management firms overseeing many facilities. "I've heard nothing but very strong endorsements for the value that people see they could bring," Weedall said.

While at Sacramento Municipal Utility District, Weedall managed what he called a "tremendously successful" loan program for energy-efficient equipment. Now, SMUD makes $25 million of such loans annually and the program is entirely self-sufficient.

"We'd offer a loan or a rebate, and invariably people would take the loan; it's that much of a better deal," he said. In Sacramento, air-conditioning contractors used the loan program to help market high-efficiency equipment to customers. "I've got to think we can have the same opportunities up here," for the likes of high-efficiency heating equipment, air conditioning (increasingly popular in the Northwest, especially east of the Cascades) and windows.

Although BPA is forbidden from loaning money, the agency is contemplating joining with Fannie Mae. "We think we can go to Fannie Mae" to develop "a structure that meets the needs of the Northwest and get a good deal with the market," said Weedall.

Northwest utility officials seem to prefer a loan venture as a regionwide program available on a turnkey basis, similar to VendingMiser and the CFL coupon program, he said.

With property management firms, Weedall said "the basic idea" is to identify people who manage energy for numerous facilities, and join with them to incorporate energy efficiency. "Once you get [these people] to understand how important it is to their bottom line and the way they do business, they buy into it pretty quickly. To a certain degree, it's the horse that just has to be led to water."

This approach proved "extremely profitable" for Pacific Gas & Electric's energy services arm in California, he noted. "Ultimately it ends up generating a lot more megawatts long term. People buy in and permanently invest themselves in these kinds of strategies."

These two ventures are the subject of informal discussions around the region, Weedall said. "Once we get [BPA] executive management sign-off internally, then we'll be taking it out for more formal presentations to the region, and get the next round of input." He has no particular timetable, although he would like to pursue "as aggressive a schedule as possible." --Mark Ohrenschall and Cassandra Sweet

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Long-Term Outlook

BPA Conservation, Renewables Part of
Regional Dialogue for Post-2006 Power

A long-term future for Bonneville Power Administration energy conservation and renewable energy initiatives is under regional discussion, raising the possibility of larger and more consistent funding for 20 years starting in 2006.

This conservation/renewables element is part of a much broader dialogue on the allocation of BPA wholesale power after the current five-year rate period expires. BPA officials are reviewing a proposal from Northwest publicly owned and investor-owned utilities divvying up the benefits from federal dams in the region after 2006.

Although the conservation/renewables piece is largely conceptual at this point, it includes a widely accepted principle to furnish more dollars for BPA programs. "We've all agreed to increase the funding level," although it's too early for numbers, said Libby Henry of Eugene Water & Electric Board.

Draft principles from a conservation/renewables working group also mention continuity, local control, flexibility and accountability.

In addition, the allocation proposal calls for utility accountability to meet burgeoning power demand in their own territories. "I really think this proposal, because of the fact it causes every utility to be responsible for its own [load] growth, will make people more interested in conservation," said Lyn Williams of Portland General Electric. "It's not quite as easy to ignore the price signals when they're hitting you directly."

Conservation and renewables advocates, meanwhile, are crafting their own ideas for BPA post-2006. "We're discussing a more robust level of effort and trying to figure out what that would mean in terms of megawatts and dollars," said Rachel Shimshak of Renewable Northwest Project.

Through 2006, BPA conservation and renewables funding would be maintained as currently planned.

'Major, Major Event'

PGE's Williams called the proposed allocation of BPA power after 2006 a "major, major event" that would effectively end the perennial conflicts between public power and IOUs over this vital Northwest resource.

As proposed, the settlement would give public-power utilities a shot at acquiring shares of the federal hydro system. Under this Slice option, utilities would pay for a percentage of the costs and receive a percentage of the output. Publics also could opt for full-requirements power from BPA, including load following and load growth services, according to a summary presented in mid-May to the Snohomish County PUD board of commissioners. IOUs, meanwhile, would get monetary benefits.

Among the consequences of this proposal are a reduced BPA role in the wholesale market, preservation of public-power preference for BPA electricity and a "durable and long-term" settlement among regional utilities. It would take effect through 20-year contracts with BPA, without any federal or state legislation, the summary noted.

PGE spokesman Mark Fryburg said the settlement "preserves a central role for BPA in management of the federal power systems" and helps address "the concern over protecting the system from out-of-state interests who'd like the power or the financial benefits it creates."

Bonneville's Paul Norman, senior vice president of the Power Business Line, made a similar point. "Our most fundamental interest is in preserving the value of the hydro system for the region," he said, calling BPA's consideration of the settlement proposal "a $50 billion decision," equal to BPA's projected revenues over 20 years.

A Bonneville response is anticipated by mid-June, the Snohomish PUD summary reported. If the agency is favorably inclined, a regional public process would come next, followed by negotiations for 20-year contracts and, finally, a BPA rate proceeding to implement the contracts.

Conservation/Renewables

The conservation/renewables element is the focus of one among many subgroups, said EWEB's Henry, utility chair for this specific effort. Participants have included representatives of utilities (IOUs and publics), BPA, advocacy groups, state energy offices, Bonneville Environmental Foundation and the Northwest Power Planning Council.

"First of all, the goals are to continue the [BPA] programs," she said, listing Conservation Augmentation and the conservation/renewables wholesale rate discount, as well as market transformation and low-income weatherization. "The current programs really do work pretty well. The plan is to increase funding levels, particularly for the [C/RD]," whose current amounts are considered "too low for small utilities." Each utility's discount is determined by its BPA subscription net requirements multiplied by 0.05 cents per kilowatt-hour. Regionally, this will amount to about $34 million in fiscal year 2002, said C/RD program manager Mark Johnson.

In addition to more money, Henry said, the subgroup generally favors the need for "real savings" from conservation and for accountability. "Those are three really principal components utilities have agreed to."

Conservation and renewables also could be significantly influenced by the settlement proposal's idea that utilities would need to account for growth within their service territories. Slice customers would be responsible for their own load growth and power shaping, while full-requirements customers would pay a share of BPA's costs for growth and load shaping.

"We're on the hook," said PNGC Power's Eugene Rosolie. Conservation and renewables development "mitigates the need to go to market, mitigates some of [PNGC members'] risk in going to the market."

PNGC's total load is about 450 average megawatts, he said, and providing power for annual growth of about 2 percent is "difficult" through conventional arrangements. "Conservation and renewables ... in small increments are something that are really attractive to us." The cooperative plans to pursue those clean-energy sources in any case, and with the load-growth provision in the settlement proposal, "Obviously it would give us more incentive," especially given the rural locations of PNGC members.

Issues Appearing

As concepts for this conservation/renewables segment take shape, so are issues beginning to appear.

Henry listed some. How specific should funding levels be established? Should they be set amounts or should they be flexible over 20 years? How can programs be structured so full-requirements customers and Slice purchasers pay their own ways without shifting costs? Should there be a fixed amount of C/RD funding for conservation and for renewables? How can programs be designed for flexibility to accommodate new technologies?

Stan Price of the Northwest Energy Efficiency Council added other questions in the April NEEC newsletter. "What is the reasonable minimum threshold for efficiency spending (3%?) and most importantly who adminsters and verifies the spending? ... How does the region achieve the benefits of program scale if efficiency spending is disaggregated over multiple utilities? All these questions are easier asked than answered."

PGE's Williams noted that Oregon and Montana have public-purposes funding for conservation and renewables, while Washington and Idaho do not. "All of those sorts of differences have to be considered in figuring out how to get a good, balanced approach." She also stressed the importance of collaboration.

"I think everybody agrees that [conservation/renewables] is a significant or an important piece," said Rosolie. "We have come up with what I think is a fairly good proposal to start with ... It shows a willingness to work on these issues and do it in a collaborative way and come up with something that works for the region, that gets us on-the-ground results in terms of conservation programs that work, and gets renewables in the ground and up and running." --Mark Ohrenschall and Ben Tansey

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RENEWABLE ENERGY/GREEN POWER

Up to 250 MW

Major Wind Farm Proposed for
Central Washington's Kittitas Valley

Wind and farm are well-known attributes in central Washington's Kittitas Valley, and now a Texas-based company wants to put the two together.

Zilkha Renewable Energy is proposing a wind farm of 100 megawatts to 250 MW capacity northwest of Ellensburg. The company made its intentions public in mid-April, and plans to file a permit application with Kittitas County in June. Zilkha wants to start construction next spring and finish by the end of 2003.

"We believe this has the potential to be one of the premier wind sites in the Northwest," Zilkha project development manager Chris Taylor told Con.WEB.
A map of the proposed wind project area northwest of Ellensburg.
(Courtesy of Zilkha Renewable Energy)

The proposed site features strong winds, ready access to roads, transmission lines and power markets, and as yet no apparent significant environmental constraints, he said. At maximum capacity it would be the second-largest wind farm in the Northwest, and the nearest to major population centers, about 100 miles southeast of Seattle.

This proposed wind venture also promises substantial economic benefits for Kittitas County, in the form of property tax revenues, lease payments to landowners and construction jobs. It could even become a tourist attraction.

Initial local reaction, though, has not been entirely favorable. Some concerns have cropped up over visual effects in the mountain-ringed valley east of the Cascades. " ... electric power will not be any cheaper for Kittitas County residents, but our valley will not be the same. Our views will be spoiled, our property prices will be impacted and economic growth slowed," wrote resident Geoff Saunders in a letter to The Daily Record newspaper.

Zilkha's Taylor and some other locals consider the most vocal opposition to originate from residents near the proposed site. "I sense a lot of support for it in the community in general," said executive director Jim Armstrong of the Ellensburg Chamber of Commerce, although he believes many people have not yet firmly decided one way or another.

A recent Daily Record news article characterized the proposal as "an opportunity for Kittitas County and an issue of divisive controversy, according to some elected officials. But they agree many questions need answers and the public must have ample time to study and comment "

'Best' Wind Site in Kittitas County

Zilkha--a Texas-based company with offices in Portland and now Ellensburg--considers this the optimum place for a wind farm in Kittitas County, in the geographical heart of Washington. "We think this is the best one," said Taylor.

It starts with the wind. He described it as a summer-peaking and "thermally driven resource" at the mouth of a draw where hotter, drier inland air meets colder, wetter air from western Washington. Without sharing details, Taylor called it "among the most energetic sites that you could develop."

The proposed project area covers about 10,000 acres on both sides of U.S. Highway 97, some 10 to 15 miles northwest of Ellensburg. At most about 60 acres would be occupied with roads, turbine pads, a substation and other infrastructure, Taylor said. His company has "wrapped up most of the land acquisition work" for a large wind farm.

Five Bonneville Power Administration high-voltage transmission lines cross the site, as does a Puget Sound Energy line. The nearby mid-Columbia trading hub enables wheeling of power. And a number of roads already exist on the site.

"It's a really suitable location for a project, and certainly the closest to a major demand center of any wind project in the Northwest," said Taylor.

Zilkha plans for a capacity of 100 MW minimum and 250 MW maximum. "Assuming a 1.5-megawatt turbine size, that's somewhere around 150 turbines at the high end," he said.

Although the company has no definitive arrangements to sell the generated wind power, "We've had active interest from a number of both public and private power purchasers," said Taylor, listing publicly owned utilities, investor-owned utilities and marketers. "We're in continuing discussions with a few of them." He declined to share prospective energy costs from the proposed wind farm, other than to describe them as competitive.

On the environmental front, Zilkha's assessment to date "looks pretty good," said Taylor. "So far, we don't see any red flags. There are plants and animals out there, but we're not seeing any heavy use by any species we think would be particularly sensitive to this kind of development. Most of this area has been heavily grazed historically; there's not a lot of pristine habitat out there." The company is voluntarily undertaking an environmental impact statement, he said, including bird studies.

In June, Taylor said, Zilkha will formally apply for a conditional-use permit with Kittitas County. Wind farms are labeled by the county as a Major Alternative Energy Facility allowable as a conditional use in the county's Agriculture-20 and Forest & Range zones--designations that cover the entire proposed site.

Views

Since publicly announcing the wind-farm plans in mid-April, Taylor said his company has sent mailings to neighboring property owners, held forums and organized briefings around the county. Project brochures also have been widely distributed.

"The primary issue we've heard about is viewshed," said Taylor. Zilkha plans to create visual simulations of the proposed wind farm, to show the actual impact. He also cited the existing BPA transmission wires and lattice towers. "We'll try to orient the project, to the greatest extent possible, so people who will have turbines visible are already looking at power lines."

Still, some local residents already are upset about the prospect of football field-length turbines rising above the valley, and have shared their opinions in letters to the local newspaper.

"The entire Kittitas Valley will have its skyline disrupted by 150 giant towers," wrote Steve Oslund. "There is absolutely no benefit for the people, only money to be made by an out-of-state private company that will not care about our property values and appearance of our countryside It will take this beautiful valley and trash it like some kind of industrial nightmare."

"Ten thousand acres of our most affordable home site will be rendered virtually unmarketable," wrote Wendy Flowers. "The very existence of these 250-foot-tall eyesores will downgrade the entire county." She prophesied that "Kittitas County will suffer irreversible and fatal damage both aesthetically and economically because of a shortsighted and opportunistic project implemented by a company that is 100 percent controlled by two men."

Zilkha's Taylor thinks the loudest opposition has come from "a small number" of nearby residents. "We've had a very receptive reaction from most people in the county." He also disputed the notion that the project site is residential in nature. "This is an area that is predominantly open range and people grazing cows," he said. "Wind is very compatible with those kinds of activities."

Still, even a local economic development official acknowledged that visual impacts merit attention. "Certainly we have a great view of the mountains in our valley and it is a very scenic area," said executive director Debbie Strand of Phoenix Economic Development Group in Ellensburg. "We are somewhat impacted by tourism. Tourists come here to see the natural beauty of this area. We want to carefully look at the project."

But she also envisions a wind farm as a potential lure for the county's "target market" of visitors from western Washington. "I would think that would certainly be a draw," along with the annual Ellensburg Rodeo, outdoor recreation, cultural events and other local attractions.

Economics

Zilkha's wind project would create some direct benefits in a county that also relies substantially on Central Washington University and agriculture (notably hay and grain) as economic drivers.

Zilkha would most likely become the county's single largest taxpayer, according to the Chamber's Armstrong. "It would certainly be beneficial from that point of view."

Construction, meanwhile, would create at least 250 jobs and all their spin-offs, said Taylor. "That's nothing to scoff at in a county of 30,000 people." About 20 people would be employed in operations and maintenance at the project's full 250-MW capacity, he added.

And, landowners would earn a minimum of $2,000 annually for each turbine on their property, amounting to hundreds of thousands of dollars total each year, Taylor said.

Phoenix Economic Development Group has commissioned its own study of the potential economic impacts, said Strand.

Meanwhile, neither Phoenix nor the Chamber has officially taken a position on Zilkha's wind-farm proposal. Nor has Kittitas County government, which has yet to officially receive a permit application.

"This is going to be very controversial," said county commissioner Bill Hinkle, quoted in The Daily Record. "The decision will come before the [Kittitas County] Board of Adjustment, but, personally, I don't have a position pro or con on it right now. I think the issues will boil down to location, location, location." --Mark Ohrenschall

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Lengthy Breeze

EWEB, PacifiCorp Power Marketing
Strike 25-MW, 25-Year Wind Deal

Eugene Water & Electric Board and PacifiCorp Power Marketing have signed a long-term deal for wind energy.

EWEB will buy the output from up to 25 megawatts of wind-powered capacity for 25 years from PPM, which owns the electrons generated from the 263-MW-capacity Stateline Wind Energy Center on the Washington-Oregon border.

This joins PPM's other wind-power sales to Seattle City Light (potentially up to 175 MW, over 20 years) and Bonneville Power Administration (90 MW over 25 years). "We're delighted that EWEB and others have shown such strong demand for purchasing renewables over the long term," said PPM chief executive Terry Hudgens in a news release.

This agreement, announced May 13, makes EWEB one of the largest public-power purchasers of wind energy in the nation. Oregon's largest publicly owned utility will get about 2.5 percent of its system load from PPM, and nearly 4 percent in total from wind power.

"The Stateline project purchase represents another significant step forward in EWEB's efforts to increase the amount of renewable energy it has," said general manager Randy Berggren in a news release. "This acquisition keeps EWEB on track with our board's goal of adding 1 percent of our load in new renewable energy supplies each year."

EWEB's contract with PPM calls for purchases from 20 MW in 2002 and 2003, then 25 MW for the remaining 23 years, according to EWEB's Jim Maloney. The municipal utility will pay a levelized price at the busbar of between 4 cents per kilowatt-hour and 4.5 cents/KWh. A separate contract covers integration and transmission services furnished by PPM, for an undisclosed price.

EWEB Wind

This Stateline agreement marks EWEB's third venture into wind energy. It already owns 21 percent of the 41.4-MW-capacity Foote Creek Rim I wind project in Wyoming, which began commercial operations in 1999. More recently the utility contracted with BPA for power from about 7 MW of Foote Creek Rim IV capacity.

Altogether, EWEB will now receive about 13 aMW of wind-generated power out of its total system load of 320 aMW, according to Maloney.

EWEB's deal with PPM begins at 20 MW in recognition of the utility's financial straits, Maloney said. "We're trying to do the right thing to add renewables and still at the same time watch our cash flows and not impose any more economic pain on our community than we already have" through recent rate increases. EWEB expects its condition to gradually improve, so in 2004 the utility's share will grow to 25 MW. Maloney praised PPM for its flexibility with this provision.

PPM, a non-regulated subsidiary of Scottish Power, also has arranged system integration and transmission services for EWEB's power. This contract is less than 25 years, Maloney noted, in the belief a regional transmission organization eventually will form.

One issue for EWEB officials was whether this purchase would foster new renewable energy, since Stateline is an existing resource, completed in late 2001. Maloney said EWEB commisioners were persuaded by PPM's notion that as it sold Stateline power it would be encouraged to arrange for further wind energy.

That is the case, confirmed PPM spokeswoman Jan Johnson. "We are out there very aggressively seeking to increase our wind portfolio. We absolutely have every expectation to add 1,000 MW of new wind power to PPM's portfolio by 2005," although she divulged no specific plans.

In addition, she said, "We still have wind power to sell" from Stateline, as the Seattle City Light deal calls for incremental increases in deliveries and Stateline's capacity is expected to increase to 300 MW this summer. "None of these contracts are specifically tied to Stateline," Johnson noted.

PPM continues "actively marketing" its wind energy to potential Northwest buyers, she said. "Wind power has been a terrific way for ... utilities of any size, of any type, to diversify their energy portfolio. It doesn't hurt that it's cost-competitive with any other resource on the market."

Meanwhile, Maloney said EWEB officials continue to talk with other wind-energy developers about other potential ventures. --Mark Ohrenschall

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Capitol Idea

Oregon's Capitol Building
Gets Power from The Sun

During the recent electricity crisis, the floodlights illuminating the Golden Pioneer statue atop Oregon's state Capitol dome in Salem were turned off as a conservation measure.

For Oregonians, having to turn off the spotlights on the state's heritage at least partly because of California power machinations may have been too much to take. The Oregon Office of Energy wondered: Why not install solar photovoltaic panels to keep the Pioneer lights burning brightly?

Many phone calls and quite a bit of work later, Gov. John Kitzhaber on Earth Day, April 22, dedicated an 8.4-kilowatt-capacity grid-connected PV array on the Capitol building's west-wing roof.
Solar panels on the west wing
of the Oregon Capitol building in Salem.
(Photo courtesy of the Oregon Office of Energy)

"Oregon has always been a pioneer in renewable energy, including solar power," said Kitzhaber, whose state is the first to install solar on a Capitol building.

Solar Project

The 60 single-crystalline panels, which have a 12-percent conversion efficiency factor, are expected to generate approximately 9,000 kilowatt-hours of energy per year. "These are the highest-grade panels you can get," said OOE analyst Christopher Dymond.

About one-third of the output will displace grid energy that powers the 250-watt metal halide floodlights illuminating the Pioneer. The remainder enters Portland General Electric's system as green energy sold to customers who participate in PGE's Clean Wind (also known as Fixed Renewable) power option by paying an extra $3.50 per 100-KWh block each month. Green energy payments funded the $60,000 array.

The energy is admittedly expensive; assuming the project takes full advantage of federal and state solar tax incentives, the cost of the energy, on a net-present-value basis, is approximately 20 cents/KWh, Dymond said. Still, the project was worth the effort to help address the "chicken-and-egg" economics of renewables, in which high up-front costs keep demand down. Increasing demand will enable solar manufacturers to use economies of scale that lower production costs.

The panels, which cover 850 square feet, were manufactured by Shell Solar, the fourth largest PV manufacturing company in the world, and provided to the project at cost. The panels carry a 25-year warranty and are expected to yield 225 megawatt-hours over their warrantied lifetime. Other equipment, including inverters to switch PV-produced direct current to alternating current, also were supplied at cost.

Oregon Solar Energy Industries Association contractors provided installation management services. Installation labor was furnished free by the International Brotherhood of Electrical Workers, Local 280, and the Independent Electrical Contractors of Oregon. Installation was preceded by a two-day training April 3-4, at which about 50 electricians, contractors, inspectors and engineers were taught the basics of solar-electric generation, system design and meeting National Electrical Code installation standards.

Sunny Oregon

While western Oregon is not generally considered a sunny place, that part of the state receives as much annual solar insolation as the national average, according to OOE. Germany, a global leader in solar, receives less sunlight than Astoria, on Oregon's cloudy coast, Dymond said.

Capitol visitors will learn more about the project at an educational kiosk--paid for by PGE and Shell Solar--that will be installed in the Capitol lobby. The kiosk will include a digital display showing how much energy the panels are producing at the moment.

Dymond said the project won plaudits across the political spectrum. "If I had told my supervisor that the governor and Republican and Democratic leaders in the Legislature would be saying the same thing (at the dedication), he would have fired me," he joked.

About the only static that's been heard about the project has come from electric customers who won't be getting the solar power because they're not paying for it. Markets, Dymond said, are the key to widespread penetration of solar. "Having a market for green power will get this thing going faster and solve the chicken-and-egg problem," he said. ---Jim DiPeso

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***Return to Contents


GREEN BUILDING

Nature, History, Community

Jean Vollum Natural Capital Center in Portland
a Potential Harbinger for Built Environment

[Editor's note: This is the first in a series of Con.WEB articles on green building.]

The Jean Vollum Natural Capital Center spans the past and the present, and perhaps the future.

This historic structure in Portland's Pearl District, originally constructed in 1895, has been transformed into a green building showpiece, from extensive use of recycled and reclaimed materials to significant resource savings to natural water filtration to public transportation links.
Jean Vollum Natural Capital Center in Portland.
(Photo by Mark Ohrenschall)

The center received Oregon's first gold-level certification under the U.S. Green Building Council's Leadership in Energy and Environmental Design (LEED) rating system, and reportedly the first such designation for any historic restoration. USGBC president Christine Ervin has called it "a landmark of national significance."

It is intended to be larger than its physical components, believes president Spencer Beebe of Ecotrust, a Portland-based non-profit organization that spearheaded the renovation. "The Jean Vollum Natural Capital Center is about connection, restoration and optimism. The environmental restoration of this wonderful historic building is just the start of a larger story of bringing people together and encouraging ideas that benefit communities and the environment," he told an opening gathering in September. The 70,000-square-foot center features a conference center along with retail, non-profit, foundation, financial, business and governmental tenants.

Ecotrust's vision for the Natural Capital Center did face some challenges and led to some tradeoffs in reaching fruition, according to people knowledgeable about the redevelopment.

The center's energy efficiencies extend a solid 21 percent beyond Oregon's energy code requirements, but they are not remarkable for green projects, particularly in the heating and cooling system, which to some extent reflects the nature of renovations. No direct applications of renewable energy are incorporated.

Still, the overall project is very striking, blending nature, history and community under one roof (an eco-roof, natch) for about $140 per square foot.

The Jean Vollum Natural Capital Center has already gained much attention in and beyond Portland, as a potential harbinger of the future built environment, particularly for renovations.

Taking Shape

The Natural Capital Center started taking shape in 1998, when Ecotrust bought the building "with the help of extraordinary gift from philanthropist and board member Jean Vollum," the organization's Web site reports.

A low-interest loan from the Ford Foundation and conventional financing from Bank of America also were secured for the $12.4-million redevelopment, said Ecotrust's Diane Dulken during a January tour. The city of Portland contributed about $200,000 in grants and loans, said Rob Bennett of the city of Portland's Office of Sustainable Development.

This building dates to the late 19th century. It opened in 1895 as the McCracken Warehouse, storing sand, lime, sandstone and other building supplies for distribution, according to historical information at the center. In the 1930s it became a central truck terminal, at one time used by 32 companies. More recently, fabrics were kept in the structure.

"After a century of service in storing the goods of the industrial economy, this historic building is poised for a role as a market center for the goods, ideas and services of the conservation economy," reads a project summary.

Ecotrust, whose expressed mission is "fostering the development of a conservation economy," certainly could have torn down the building and started anew on the site at 721 NW 9th Ave., just north of central downtown Portland. But, said Dulken, "We chose not to move the building." Instead, notes the summary, "Ecotrust's green renovation of the brick and timber building respects the character of the original 1895 structure while incorporating environmentally-innovative materials and techniques."
A bio-swale collects and
filters water runoff outside the center.
(Photo by Mark Ohrenschall)

This restoration theme fits in with the surrounding, and revitalizing, Pearl District, which is changing from a former industrial area into a mixed-use district, Dulken said.

"I look at it as a catalyst for that neighborhood," said senior design consultant Ralph DiNola of Portland General Electric's Green Building Services, who worked on the project's LEED certification.

Also, the notion of fixing up rather than demolishing, reflects a sustainability principle. "Ths building was such an exciting structure to maintain and restore," said DiNola. "I think it tells a good story that way," demonstrating some possibilities for retrofitting.

Green Building Measures

The Natural Capital Center features extensive and diverse green building measures, starting with the construction process.

Ecotrust and contractor Walsh Construction report that 98 percent of construction waste was either reclaimed or recycled. Among the reclamation examples are salvaged wood used for paneling and framing.

Also on the materials side are found recycled rubber flooring; recycled latex paint bought from Metro regional government (available at lower prices than conventional paint, according to Dulken); 95-percent recycled content steel; and certified sustainably harvested wood on the outdoor terrace and new windows and furniture.

Water, meanwhile, is treated as a valued resource.

Low-flow fixtures achieve 32-percent water savings over code requirements. Those include showers and interior faucets with 2 gallons per minute flow, and lavatory faucets with 0.5 gpm aerators, according to a recent article in Consulting-Specifying Engineer by Jonathan Gray and Jerry Yudelson of Interface Engineering. "It should be noted that to achieve [the 32-percent savings], 40,000 gallons of recycled water were subtracted from the total use, based on calculations for expected stormwater reuse."

Outside, an eco-roof with native plants and wildflowers tops the building while a bio-swale on the ground collects and filters runoff. Dulken estimated that 95 percent of the water falling on the property will be kept out of the municipal system.
This atrium is one of the center's common areas.
(Photo by Mark Ohrenschall)

"One of the areas that really shines in this building is their commitment to salmon restoration ... and re-creating habitats with the eco-roof and bio-swale," said OSD's Bennett, who works on the third floor and who moderated a January panel discussion on the center.

In transportation, a streetcar line passes the center and other mass transit options are nearby, including the city's passenger train and bus stations. It also has 50 bicycle parking spaces (along with showers and lockers) and a car-sharing arrangement which, on a January day, featured a two-seat hybrid vehicle.

Although not really a green building feature, the center also underwent seismic upgrades--a necessary, challenging and expensive aspect of renovating a century-old building, according to Bennett.

Energy/Energy Issues

In its energy-saving features, the Natural Capital Center goes well beyond Oregon's energy code standards: 21 percent, according to DiNola.

Yet, as a green building aspect, the center's energy performance is not extraordinary, even with many noteworthy efficiency features.

Altogether the project earned 41 of a possible 69 points in six categories to gain the LEED gold rating. But in the energy and atmosphere category, the center chalked up only five out of a potential 17 points, for optimizing energy performance 20 percent beyond requirements and for measurement and verification. The center came up blank on further energy optimization, additional commissioning and renewable energy/green power.

"Part of the story is they were trying to use what's been called state-of-the-shelf instead of state-of-the-art, to demonstrate to people, 'I can do this, too,'" said DiNola. "They didn't want to do all these real cutting-edge technologies that are untested."

The heating and cooling system, with its rooftop packaged HVAC units, is a prime example. "They could've gone more efficient or done something like ground-source heat pumps," said DiNola, although the latter would have been "more expensive and more difficult on a site like that." Ecotrust also could have opted for an Energy Star-rated roof.

Then there's insulation, or rather its relative absence in the heavily bricked building. But that presents other dilemmas, DiNola noted. "If they added more materials it would have caused more environmental disruptions, creating materials and installing them. And they wanted to preserve the aesthetics of the original warehouse building," which inevitably added certain energy costs in heating and cooling. "These are all questions you have to balance going through this process."

Still, many significant energy-saving features were put into the center. Lighting elements include T-5 and compact fluorescent lamps, along with considerable daylighting (especially on the third floor) and occupancy sensors with controls. High-performance windows help prevent solar gain, DiNola noted. The third floor has spray-in foam insulation that Bennett called "incredibly dense and adheres to all the framing structure," with no chlorofluorocarbons (CFCs).

An economizer cycle on the HVAC system draws in outside air for cooling purposes when the outdoor temperature drops below 65 degrees, DiNola said. "It's a really well-balanced system."

Occupancy sensors and controls also foster energy efficiency by adjusting indoor temperatures beyond normal range by up to 5 degrees. "Every degree you have to heat or cool a building is a pretty substantial amount of energy," said DiNola.

The center also has operable windows, a nice touch for people but a potential problem for the cooling system in warm weather. "There may be some adjustments that need to happen" with the control system, Bennett said.

The design process also influenced the redevelopment.

Bennett said the project team--including Ecotrust, developer Heritage Consulting Group, Holst Architecture and Walsh Construction--had much to learn. "The theme I picked up on (in a January panel discussion) was that they did try to work pretty closely together and had a lot of team meetings" that were "a little bit awkward and not always efficient. There was a really big learning curve for everyone involved" in meeting the "very rigorous environmental goals" established by Ecotrust.

PGE's Green Building Services, meanwhile, joined the team about halfway through construction, to help pursue LEED gold. "The LEED process is intended for early design, to help the design team make critical decisions, more of an integrated design process," said DiNola. He added that many green building measures were already in the works.

Ultimately, he concluded, "It was an extremely successful project. They did a lot of wonderful strategies."

And it could have turned out quite differently. "Any other developer may have demolished that building. That would have been the cost-effective thing to do," said DiNola. But that would have lost "the character of it, the history, the way it contributes to the neighborhood, plus the embodied energy in the materials."

Fostering Community

The Jean Vollum Natural Capital Center is intended as more than an eco-friendly building.

It also aspires to foster community. "The building design is part of a larger effort to bring people together," said Dulken.

An Ecotrust information sheet touts the center as "a vibrant gathering place for environmentally and socially responsible ideas, goods and services. This environmental restoration initiates a larger vision of bringing together a community of tenants and inviting the public to share in the goals of encouraging a conservation economy."

The tenant list numbers 19, including retailers Patagonia, Hot Lips Pizza, World Cup Coffee and Pearl Clinic and Pharmacy, environmental bank ShoreBank Pacific, Progressive Investment Management, Sustainable Harvest, Individual Tree Selection Management, Wild Salmon Center, Ecotrust, Certified Forest Products Council, Environmental Careers Organization, three foundations and Portland's Office of Sustainable Development.

Notably, in the midst of a soft economy, about 96 percent of the center's space is occupied.

Public spaces include an atrium, resource center and outdoor terrace. A second-floor conference center is available for business and community events; more than 200 such gatherings have been held. Free public tours also are offered every Wednesday at noon.

As for the people who work at the center, "Everyone really likes it," said OSD's Bennett. "You can have impromptu conversations. It's just a nice building with a lot of neat people. The common spaces are great."

Market Transformation

At the January panel discussion, Bennett said project participants explored the notion of market transformation. "This is a very special building with an unusual client. Is this transferable? Are these project team members incorporating sustainability into their own practices because the experience was so good or they think it's a necessary part?"

Responses varied, he said, but, "Overall the major theme was, yes, it's here to stay. Energy efficiency, resource efficiency, stormwater management, materials efficiency--these are no longer want-to-haves. The writing is on the wall. Professionally, these building industry sectors need to get on board."

Many already have. Natural Capital Center developer Bob Naito of Heritage Consulting Group "is applying lessons learned from the Ecotrust building to his next project--One Waterfront Place, a 250,000 square foot office building in the River District," according to Ecotrust.

"[Naito] feels there's no premium to LEED in the long run," said Bennett. "A high-quality building can get certification without spending a whole lot of money."

And in any case, conventional construction accounting ignores the human factor. "There are a number of studies out showing that healthy interiors are more productive," said DiNola. "Anywhere from 80 to 90 percent of business cost is in people. If you can make people even slightly more productive, it far outstrips the extra cost of doing all this green building. That's the larger story in the building." --Mark Ohrenschall

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***Return to Contents


POLICY

New Funding Source

IPUC Approves 0.5 Percent Rate
Surcharge for Idaho Power DSM

Idaho Power demand-side management initiatives now have a specific funding source.

The Idaho Public Utilities Commission approved a DSM rate surcharge (known as a tariff rider) in a May 13 order approving a $255.9 million power cost adjustment for the investor-owned utility.

Set at 0.5 percent of revenues from all customer classes, the tariff rider took effect May 16 and is expected to generate about $2.6 million annually for DSM ventures. The IPUC deferred a similar funding proposal last fall in the wake of substantial rate increases stemming from the energy crisis.

"In granting the rate increase authorized by this order, the Commission recognizes that consumers need avenues to reduce their consumption," the IPUC said in its May 13 ruling. " ... conservation and DSM programs are powerful tools Idahoans can use to mitigate the impact of this rate increase as well as ones that may occur in the future. The Commission believes that funding a comprehensive conservation program is critical given last year's market volatility and the opportunity to benefit from long-term demand-side measures."

Also in the same order, the IPUC jettisoned tiered rates for residential customers in favor of a uniform charge.

Earlier in May--as directed by the IPUC in a sternly worded April 3 order--Idaho Power turned in a DSM plan with an updated menu of prospective ventures. Idaho Power reported it would need six or seven months and four more advisory group meetings "to design a long-term DSM plan ready for implementation," according to its May 2 filing.

Idaho Power's Darlene Nemnich said the utility is "very pleased" with the DSM rate surcharge, which it initially broached last summer. "The plan is to try to come up with a good methodology for screening programs and seeing what all of our options are and prioritizing options," in conjunction with its Energy Efficiency Advisory Group.

DSM Surcharge

Idaho Power's DSM plan concluded: "The level of future conservation activities will depend on the level of funding to be determined by the Commission."

An answer to that question arrived May 13, with the IPUC's order on the utility's power cost adjustment and demand-side funding.

The commission established the DSM tariff rider as a distinct item on customer bills. It will total 30 cents per month for residential customers and a cents per kilowatt-hour charge for other customer classes, averaging 0.011 cents/KWh for special-contract customers and 0.020 cents/KWh for other non-residential classes. This should raise about $2.54 million annually, based on 2000 revenues.

"We recognize that this amount of funding may not be adequate to support some programs that could be very beneficial," the IPUC said (conservation advocates wanted a 1.5-percent level). "However, we find it is a reasonable starting point and will reassess the level of this charge annually." IPUC staff supported the DSM surcharge proposal at 0.5 percent.

Industrial Customers of Idaho Power wanted a self-direction option for the DSM funds, but the IPUC "finds it more appropriate to retain oversight of the expenditure of funds collected by this tariff rider," the order said.

The commission directed Idaho Power to consult its Energy Efficiency Advisory Group on the need for a thorough DSM study, and to investigate with the advisory panel initiatives for compact fluorescent lamp coupons and time-of-use residential metering. Idaho Power also must turn in annual reports on DSM activities.

Meanwhile, the commission agreed with Idaho Power's request to end its three-tiered inverted block residential rate structure established in 2001, citing "tremendous public response" against these tiered rates, particularly from Idahoans living in all-electric homes.

The IPUC acknowledged a fainter conservation price signal without tiered rates, but cited a concern over public perception. "Many customers attributed their high energy bills to the tiered rate structure rather than to the implementation of a 31% residential increase over the previous winter's rate." The approved average rate of 7.1 cents/KWh is 15 percent higher than the former lowest tier and the same amount lower than the erstwhile highest tier.

DSM Plan

Idaho Power's DSM plan outlined many potential ventures, slightly revised from last year's proposal (see Con.WEB, Aug. 30, 2001). It would allocate program dollars to each customer sector roughly according to its contribution through the subsequently approved tariff rider: residential, $1.04 million, 40 percent; commercial and industrial, $1.2 million, 45 percent; irrigation, $361,427, 15 percent.

Prospective residential offerings listed address compact fluorescent lamps, central air conditioning and heat pumps, Energy Star appliances, new construction, lighting fixtures, manufactured housing, duct sealing and low-income programs. Commercial/industrial options cover CFLs, VendingMisers, light-emitting diode traffic lights, BacGen BioWise technology for wastewater treatment facilities, reduced fan air, lighting retrofits, building tuneups, small retrofits, offerings through BetterBricks.com and industrial customer self-direction. Irrigation possibilities encompass both new and existing systems.

The 12-member advisory group, which met for the first time April 30, provided some additional ideas, such as a consumer guide for energy efficiency, water-heater incentives, solar water-heating and daylight/passive solar.

Idaho Power proposed looking into three specific ventures for the near future. One would focus on consumer education and builder training for the state's new energy code requirement that takes effect Jan. 1 (see Con.WEB, March 30, 2002). Another would help public schools improve their energy efficiency. A third would involve utility help in an Energy Star new construction pilot program planned to debut this summer.

Those now have a lower priority, Nemnich said, given the commission's order to explore other specific ventures such as a CFL coupon program.

Meanwhile, the utility anticipates working with its advisory group in coming months to consider DSM program offerings. "This process will look at Idaho Power system needs, energy efficiency resource assessment, cost-effectiveness from several perspectives, and delivery method options," said the utility's DSM plan. Nemnich said peak-load savings will be an important consideration for Idaho Power and its summer-peaking system.

Idaho Power DSM, Present and Past

In addition to looking ahead, Idaho Power's filing briefly summarized the utility's DSM efforts current and past.

In 2001, Idaho Power reported it spent $1.76 million on energy efficiency. Most of the money--$1.24 million--went to the Northwest Energy Efficiency Alliance, "the company's primary channel for energy efficiency and conservation." Idaho Power also spent $354,804 on low-income weatherization and $85,175 on energy efficiency packets (through Bonneville Power Administration's conservation/renewables wholesale rate discount).

That's a big decline in annual DSM funding from the mid-1990s heydays. Idaho Power's spending since 1990 resembles in bar-chart form one of the state's mountains, starting at $1.9 million in 1990, climbing to $6.9 million in 1994, then gradually dropping to the $1.76 million last year. The IOU reports cumulative energy savings of 26.2 average megawatts in its DSM history, almost entirely since 1990.

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***Return to Contents


MARKETPLACE

DSM Agreements

Avista Contracts for Two Energy-Saving
Proposals from Resource Solicitation

Avista Utilities has contracted for two energy conservation proposals submitted through its resource solicitation issued in summer 2000.

The two conservation proposals--from the Washington State Department of General Administration and Seattle-based Quantum Engineering--are expected to save 3 average megawatts at a levelized cost to Avista of slightly less than 4 cents per kilowatt-hour. Contracts were signed in January, nearly a year later than initially expected.

These were selected from among eight demand-side bids received in Avista's August 2000 solicitation for about 300 megawatts of energy resources. Three DSM finalists were announced in December 2000. The investor-owned utility eventually turned down the third finalist, proposed at 10 aMW. The two contracted DSM proposals were chosen on a "basic least-cost approach to acquiring resources in the RFP," said Avista's Jon Powell.

Avista had already tapped the Coyote Springs 2 combined-cycle natural gas-fired combustion turbine in north-central Oregon for the vast majority of its solicited new resources. That 280-MW-capacity plant (now half-owned by Avista) is under construction. None of six renewable energy proposals made the utility's list of finalists.

Under the DSM contracts, Washington GA is pursuing energy efficiencies in public facilities, while Quantum targets office, retail and food-service sectors.

The Spokane-based investor-owned utility will pay for the contracted savings through its 1.95-percent DSM rate surcharge.

Seeking Resources

Avista's August 2000 solicitation outlined a need for some 300 MW of new energy resources, beginning in 2004 and perhaps earlier. The utility specifically welcomed efficiency and renewables bids, although it did not specify amounts; the RFP had a goal "to identify low cost and environmentally sound resource options that best satisfy Avista's resource needs" (see Con.WEB, Aug. 31, 2000, for a story on the solicitation).

After receiving 32 bids--including eight on the demand side and six renewables--Avista selected Coyote Springs 2 and three DSM finalists (see Con.WEB, Dec. 21, 2000).

"The acquisition of Coyote Springs 2 is a significant resource that allows us to be less reliant on a volatile electric wholesale market, especially during times of high energy demands," said Avista Utilities president Scott Morris in a December 2000 news release. "Coyote Springs 2 and the demand-side management proposals provide us long-term, cost-effective resources to meet our growing customer needs in eastern Washington and northern Idaho." Avista spokeswoman Catherine Markson described the gas plant as an important baseload resource for Avista. The project, at the time owned by an Avista subsidiary and planned for transfer at cost to Avista Utilities, is now 50-percent owned by Mirant.

More than a year lapsed between the announcement of three DSM finalists and signed contracts with two of them. The energy crisis and wholesale price spikes occupied the utility's attention, as did the third and ultimately rejected DSM proposal. "It just didn't fit into our mix," Powell said, noting uncertainties of savings in that particular unidentified market.

DSM proposals essentially competed against each other, as additions to Avista's ongoing energy efficiency efforts. The utility provided some guidelines--including minimum annual savings of 0.25 aMW, installations within three years and no curtailments allowed--but otherwise left it fairly open to proposers. "We're really looking for innovative bids," Powell said after the solicitation appeared.

Washington GA, Quantum Projects

Washington GA has the larger of the two contracts, calling for 2 aMW of installed savings in calendar years 2002 through 2004. Avista will pay a levelized cost of 3.8 cents/KWh, spread through 2014, said Powell.

GA is focusing on two categories of public facilities: one is state agencies, community colleges, universities and special districts, and the other is schools (kindergarten through 12th grade), cities, counties and other local governmental entities.

"It's going to result in improvements in our public buildings we wouldn't otherwise be able to do," said energy program manager Clint Lougheed of GA's Facilities Engineering Services Team.

Already in progress is a campuswide lighting project at Spokane Community College and Spokane Falls Community College. "We did an energy audit for Community Colleges of Spokane five years ago, and we were unable to complete the lighting project. It wasn't cost-effective for the college to do it," he said. "Now, with the addition of this Avista payment stream, we're able to do the lighting project and improve the academic environment," while creating local jobs and spurring the local economy.

GA essentially serves as a facility owner's representative, Lougheed said, subcontracting energy auditing, measure identification, design and installation to prequalified energy services companies. "The actual way we're getting the audits and work done is performance contracting, with the added twist of having this additional payment stream" from Avista. The utility dollars and the energy cost savings will enable public agencies to pay off state loans for the efficiency projects.

In addition to the work at community colleges (subcontracted to Quantum Engineering), audits are under way at Washington State University and city of Pullman facilities. GA also is looking at hospitals and K-12 schools. Lougheed expects most of the 2 aMW to come from state agency, higher education and special district facilities.

Meanwhile, Quantum Engineering is concentrating on medium-sized office buildings (up to 150,000 square feet) along with grocery stores and retail outlets, said Quantum president Mike O'Connor.

Powell called this "the market that we and everyone else have historically had a hard time getting to" for energy efficiencies. Quantum's contract specifies 1 aMW of installed savings by the end of 2004, and payments from Avista of 3.75 cents/KWh, levelized, through 2014.

The engineering/construction firm is taking a two-pronged approach in marketing to potential clients: direct sales by Quantum as well as relying on subcontractors and consultants to talk with potential customers about efficiency ventures, O'Connor said. "After they contact the customers, we go and work with the customers directly to develop projects." Quantum will conduct energy audits and share the results with customers. "At that point, hopefully we'll enter into a design and construction agreement. We handle full services," including design and measure installation. Quantum also is developing different project financing options for customers.

O'Connor expects his firm will pursue efficiencies in lighting, HVAC controls, energy management systems, compressed air and, in grocery stores, refrigeration systems and heat-recovery opportunities. "I anticipate a fairly even spread [in collected savings] between grocery stores, office and large retail," he said. As for reaching 1 aMW, "We anticipate getting that easily ... We think we'll have that level in development by next year at this time." --Mark Ohrenschall

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PERSPECTIVES

Two Decades and Counting

May Marks Energy NewsData's
20th Anniversary

The 20th anniversary of Energy NewsData came at the end of the week leading to Memorial Day, and I wrote this column marking that milestone to be published in both of our print newsletters and in the on-line publications as well.

Congratulations, California Energy Markets

I begin with congratulations to Arthur O'Donnell and the California Energy Markets staff for another award. Here's a trimmed version of Arthur's memo with names and details.

"For the second year in a row, California Energy Markets has been cited by the Newsletter & Electronic Publishers Foundation as part of its annual Excellence in Newsletter Journalism Awards program. This time, we were given a 2nd Place Award in the category of 'Best Spot News.' Usually this is given for a single story, although I have been told that the judges 'did something unique' in our case and combined our three entries into one for consideration.

"That means that everyone on staff is an award winner! For the record, what was submitted included pretty much the entire CEM issue No. 601 from Jan. 19, 2001--the week that California's market collapsed and a state of emergency was declared. Besides the multitude of stories from California, there were also valuable contributions from our Nevada correspondent and our colleagues at Clearing Up.

"If you recall, this was a very difficult week for everyone, especially the CEM staff. The San Francisco office was subjected to the same 'rolling outages' that were declared throughout the state and because of late-breaking news, this issue also tested the outside limits of our production and mailing deadlines.

"Also subsumed in the award was an entry [of] a half-dozen stories from CEM Issue No. 612 of April 6, 2001, particularly reports about backroom financial dealings by the Davis administration [and] stories about Governor Davis' 'state of the energy' speech, plus the deadliner on [Pacific Gas & Electric] bankruptcy. The NEPF judges also included two 'Bottom Lines' columns related to California's energy efficiency response during the emergency, in CEM No. 625 of July 6, 2001, and No. 643 of Nov. 9, 2001.

"My intent in submitting this variety of articles was to show how CEM staff members work together as a team to produce the best energy news coverage available every week, under even the most trying of circumstances. For this reason, the awards certificate will be made out to the newsletter as a whole. Again, congratulations to all!"

Four Newsletters

At year 20, we are publishing four newsletters-Clearing Up, California Energy Markets, Con.WEB and NW Fishletter.

They are all excellent.

If there are better regional energy policy newsletters than Clearing Up and CEM, I have never seen or heard of them.

Con.WEB last year had its financial support grant raised and renewed for three years by unanimous vote of the Northwest Energy Efficiency Alliance board. The electronic publication gives Pacific Northwest energy conservation and renewables initiatives a common frame of news and information reference unmatched anywhere. NW Fishletter publishes in the political maelstrom of salmon recovery and is very simply the best regional fish policy newsletter anywhere. It is resolutely objective, has been called "Radio Free Fish" and circulates twice a month to some 2,000 e-mail addresses. A couple of weeks ago, Fishletter editor Bill Rudolph sent me an e-mail that lists recent quotes, citations or repostings of Fishletter material. There are 67 entries on that list; it's too long for inclusion in the column.

EnerNet Technology Exchange

Our new project is now officially set as EnerNet Technology Exchange, and its major products are a newsletter titled Energy Prospects and a Showcase conference-exhibit, the first of which is Energy Technology Showcase 2002. This event is scheduled Oct. 21-23 at the DoubleTree Hotel Portland-Jantzen Beach. Prospects will begin preview publication in June and regular publication shortly thereafter. It will appear fortnightly and will be available to subscribers by password access on the Web or in PDF by e-mail. On off weeks, we will publish an updating bulletin called Sparks.

EnerNet staff now numbers four. Kari Hanson, a former editor of Clearing Up who left us in 1991 to become a lawyer, returned last year and became EnerNet's executive editor. Katie Mulligan, an energy editor who worked for McGraw-Hill in Washington, D.C., has been with us for three years during our long-running start-up. Tracy Benzen, a Missourian come West, is EnerNet's research and administrative assistant. Our first full-time EnerNet staff writer is Garrett Hering, who joins us after a stint in Germany with the Frankfurter Allgemeine Zeitung.

Independent Journalism

NewsData staff produces excellent journalism, and that happens in part because we are independent.

In May 1982, as it turns out, it became necessary for me to invent independent regional energy journalism to make good on a pledge I made to a group of co-op utility managers and board members at a conference I organized on behalf of Orcas Power & Light in Washington's San Juan Islands. They said they didn't know what was happening in the wake of the notorious problems of the Washington Public Power Supply System, and I promised to do something about it.

The problems turned on lawsuits following from the termination of two unfinished nuclear plants for which WPPSS had borrowed $2.25 billion. So I went to independent work tracking the aftermath of that termination, inventing in the process a version of desktop publishing on a Xerox 820 personal computer in the basement of my home on Seattle's Queen Anne Hill.

Clearing Up was independent from the start, because I thought that only independence delivers a useful product by reporting facts in more than one dimension. The truth of a matter can only be discovered (if at all) in a balanced report. But independence and balance do not feed the bulldog. The new publication needed to be a good read.

The style of Clearing Up--which survives to this day in CEM and the other NewsData publications--is lively, focused and objective; and while delivering serious news, it does not take itself all that seriously. I am neither the originator of that style nor a leading practitioner. As it turns out, if editorial staffers did not write that way when they came to work (and many already did), they soon learned how and made that style their own. The result was a family of trade journals that did not read like trade journals. It also meant cartoon-type art on the front page, April Fools editions and topical energy carols before the holidays.

Proud of Company

I am especially proud of our company at this anniversary because I believe it is a rewarding and humane place to work.

Arthur O'Donnell and Brooke Dickinson have been here more than 15 years; Daniel Sackett, Jude Noland, Ben Tansey, Mark Ohrenschall and Lynn Francisco all have more than 10 years at NewsData; and J.A. Savage is approaching 10 years. Bill Rudolph joined NewsData in 1996.

I am also proud that we hired J.A. even though she had filed a lawsuit connected with her work as an energy journalist against PG&E, a very major subscriber, which at one time had blacklisted her and threatened to pull advertising and subscriptions from publications that employed her.

I am proud that Angela Becker-Dippmann came to NewsData as a temp clipping newspapers and liked it well enough to get a regular job with us, learn energy journalism and become Clearing Up's managing editor. She is now Washington Sen. Maria Cantwell's legislative assistant for energy. And I am proud indeed that we were able to make it possible for Pam Russell, who held almost every editorial job in the company, to work at a series of flexible assignments while attending seminary, leading to her ordination in the Lutheran ministry as the Rev. Pamela Sue Russell.

We are journalists at NewsData first and always, and that commitment is what makes us useful to those who pay our keep. Our very first award came in the first year from an activist group, Progress Under Democracy, which was challenging the utility establishment in the wake of the Supply System debacle. The utility establishment, for its part, made its award in the form of lots of subscriptions.

Changing

NewsData is changing in year 21. CEM has moved from its long tenancy in Arthur's living quarters to its own digs on Potrero Avenue in San Francisco. We are updating communications, because on any given day NewsData staff can be working in San Francisco, Oakland and Davis in California, and Seattle, Walla Walla, Tacoma, Kent, Kenmore and Long Beach in Washington.

The new EnerNet Technology Exchange project will generate change, but the four baseline publications will not be diminished on that account.

I am beset these days by retirements all around involving people younger than I am. I asked Bill Weaver, stepping down from Puget Sound Energy, how to retire, and he said it helped to get sick first. I am pleased to say that Bill, who remains younger than I am, is now just fine. But I concluded that illness as a retirement enabler is not all that exciting. And as a matter of fact, no one with two kids still in college is even allowed to think of retirement.

At year 20, I am personally grateful to be working with such remarkable colleagues and friends at NewsData and in an energy community with another remarkable set of colleagues and friends. I have thanked the energy industry in public time after time for staying in trouble for these 20 years and showing the signs of keeping confounded for the foreseeable future. That remark is of course made in good humor and received as such by people with whom we share a sense of industry trials and tribulations.

In the uncharted energy environment of 2002, companies and organizations take actions that make very little sense to some of us at NewsData. But we got into business in the first place on account of turmoil. We express our frustrated viewpoints in opinion columns, which are intended to criticize but not to judge.

Beyond the opinions, we are well employed to be doing something that really matters to people trying to understand difficult times in their work lives. We are honored to help however we can in our independent way as we cross into our third decade. --Cyrus Noë

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Classroom Discussion

Peanut Butter Sandwiches, $500 Million, Windmills
Highlight Talk to Elementary School Students

Peanut butter sandwiches, half-a-billion dollars and windmills.

They don't have much in common, but they all grabbed attention in two Kenmore Elementary School classes when yours truly spoke to them in early April.

The occasion was the annual Learning Fair, and my role was to talk about writing to the classes of our 8-year-old daughter Rachel and 7-year-old son Willie. Which I did. But I also took the opportunity to chat about energy conservation and renewable energy with P.J. Maffett's third-graders and Pam Murray's first-graders.

The peanut butter sandwiches connect to landfill-gas plants, the half-a-billion dollars represent the eventual potential treasury of the Energy Trust of Oregon and windmills are generally well-known to kids as spinning things.

Somewhere in there lies the seed of a conservation/renewables campaign for the under-10 generation--but a more fertile mind than mine will have to nurture it.

These Seattle-area youngsters also readily understood saving energy by turning off power-using stuff (we didn't go into the conservation vs. curtailment debate) and even the idea of not wasting electricity so there's enough juice to keep the lights shining.

Alas, my notes show the environmental angle went unmentioned, although I brought it up to the third-graders. The link between conservation/renewables and reduced impacts from other power-generating sources is hard for young kids to grasp. Perhaps an Energy Web future will make it more evident.

And in that future, these Kenmore kids will at least know their thrown-away peanut butter sandwiches could help make electricity. Oops ... I forgot to mention the environmentally preferable composting. Maybe next time ...

Writing, Editing and Peanut Butter Sandwiches

When my wife Janice showed me the note from school seeking writer-parents for the Learning Fair, I hesitated ... about a second. And then only because of apprehension over public speaking. But we all like to talk about what we do, of course, and I also sensed a teachable moment for conservation and renewables beyond our own kids.

The teachers were most interested in the writing and editing processes, so my presentation to each class focused on how I do my job--deciding what stories to cover, gathering and organizing information, outlining main ideas, then sitting down to write, rewrite, edit, check facts and proofread. I left out the gnawing anxiety of facing a blank screen and a deadline, as well as the true satisfaction of completing a story and an issue as best one can. But I figured the young writers knew these already, or would soon enough.

At the end, I offered a few general suggestions: read and write as much as possible, observe the world around you, use your imagination and enjoy the chance to express your unique self through writing.

How these thoughts fit into their impressionable young minds, I couldn't really tell. But I know in both classes the kids perked up at the mention of peanut butter sandwiches.

It came in the context of defining renewable energy, which I described as sources that can be used over and over again, like wind, sun, heat from the earth and even rotting garbage. Yuck! But true for the latter, through decomposition of organic matter that produces methane that can be extracted and burned in engines connected to electric generators.

In Rachel's third-grade class, the peanut butter sandwich sparked a lively discussion about other biomass opportunities, including various fruits, flowers and even ... people (we didn't explore this innocent comment).

And in Willie's first-grade class, his buddy Chris earnestly asked whether you could put peanut butter sandwiches on utility lines to make more power. I initially suppressed a delighted giggle, but later I admired the ingenuity he displayed in his question. That kind of thinking can change the world.

Journalist at Work

To give the kids a glimpse of a journalist at work, I pulled out my laptop computer and conducted an "interview" at the end of the presentation in P.J. Maffett's class. Nepotism was involved.

Me: "What does energy conservation mean to you?"

Rachel: "It means to turn off the lights when you're not using them. Also, to make sure you turn off your computer and you don't leave the refrigerator open." [Editor's note: She enjoys reminding her dad--"Mr. Energy Conservation"--to turn off the lights at home.]

Me: "What are some ways to save energy?"

Rachel: "You can buy fluorescent light bulbs that don't use as much energy. Regular light bulbs, they heat up the room, also, and they are using a lot of energy to do both," while furnaces are already designed for heating. "And using energy windmills."

Me: "Why is it good to save energy?"

Julia (classmate): "It saves you money."

P.J. Maffett: "So we don't run out of energy."

From that point, according to my notes, the discussion turned to examples of renewable energy. Rachel mentioned solar photovoltaic panels at Seattle Center, while P.J. recalled solar water-heating at her husband's family's home in Colorado. A number of kids said they'd seen windmills in action--not necessarily energy-producing, although Julia described wind turbines near Palm Springs, CA. Todd noted that waterfalls can make energy. I remained silent on the distinction between hydropower and the non-hydro renewables we cover in Con.WEB; that would've only muddied the educational waters.

The third-graders also seemed quite interested in the Energy Trust of Oregon's overall budget of (potentially) half-a-billion dollars in the next 10 years. Not quite as much money as Bill Gates has, I mentioned, but about what it cost to build Safeco Field. Let's hope the Trust performs as well as the Mariners in recent seasons!

In Pam Murray's first-grade class, time slipped away before I could "interview" Willie and his classmates. We did write an outline of energy conservation, listing buildings, light bulbs and (of course!) peanut butter sandwiches. And I did have a chance to ask Willie at the end: "Why is it a good idea to save energy?"

"So you won't waste it," he said. "So you'll have enough energy so the lights don't go out." Then he whispered to me, "You forgot about windmills!"

Maybe next time ... After all, education (including that of parents and journalists) is a process, not an end. --Mark Ohrenschall

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