CWEB.087/March.27.2003

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Our recent story on Northwest utility conservation savings dropping more than 50 percent from 2001 to 2002 ( Con.WEB, Feb. 27, 2003) generated several responses that merit a response.

Reader Fred Gordon took issue with the story's assertion that some level of saturation of energy-saving measures, specifically including compact fluorescent lamps, likely contributed to the lower 2002 numbers. He suggested reviewing the Northwest Power Planning Council's draft supply curves. "Saturation of CFLs is puny," he e-mailed, "and cannot explain a decline in investment."

This reporter takes responsibility for a misinterpretation and for a too-loose use of the term "saturation." Clearly, there are still plenty of spots left for CFLs.

(Courtesy of Roller Coaster DataBase)

Ken Corum of the Northwest Power Planning Council offered a rough estimate that 100 million CFLs could be cost-effectively installed in Northwest homes, based on approximately 5 million households regionwide with an average of about 20 bulbs apiece. In 2001, regionwide compact fluorescent sales and free distribution amounted to about 8.3 million lamps, which he said "has certainly put a hole in [the 100 million total] but has not exhausted it at all." With substantially reduced utility programs in 2002, regional CFL sales and distribution dropped to about 4 million in 2002, Corum said, but that still represents a big increase compared to pre-2001 annual sales. That suggests "at least a partially transformed market. That's a great achievement, but an achievement that won't be reflected in our accounting of utility program savings," he said.

Thanks to Fred for sharp-eyed reading and a well-taken point, and to Ken for the clarification.

Another Ken--Ken Keating of Bonneville Power Administration--offered another e-mail on the story, which was headlined "Roller Coaster Redux?": "Roller coasters are also created when you ramp up very fast to an unsustainable level. It was a danger that we at BPA saw as we went through the 2001-2002 years. We kept saying that we need to be careful not to create our own roller coaster by spending too fast (like spending more than one year of C&RD [conservation and renewables rate discount] in the first year and starting the spending six months early without increasing the C&RD pot). Front-loading C&RD impacts will create an up-and-down sensation as less dollars are available in the last couple of years. As you note, everyone's budget woes and the saturation of some markets like VendingMi$er and installing CFLs at the dams, as well as overpaying for CFLs in the market, create situations that are not sustainable. Nevertheless, BPA believes that it can meet the overall [conservation] targets despite the challenges of reduced resources."

Mary Smith of Puget Sound Energy informed us that her investor-owned utility recorded 8.6 average megawatts of savings in 2002, not 6.8 aMW as initially cited in the regional summary of conservation acquisition numbers. This raises the reported regional total for 2002 to slightly more than 69 aMW--still less than half the nearly 150 aMW in 2001.

We encourage readers to share comments, clarifications, criticisms, questions and other thoughts with us as well.--Mark Ohrenschall

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Mandate, Cost Concerns

Proposed Utility Conservation, Renewables
Standards Fail in Washington Legislature

Proposed renewable energy and energy conservation standards for Washington utilities have met their apparent demise in the state Legislature, a victim of concerns notably including government mandates and costs.

A conservation/renewables standards bill has expired in the House of Representatives Appropriations Committee, after receiving narrow approval in early March from the House Technology, Telecommunications and Energy Committee.

The TTE-approved version--slimmed down from the original bill--called for Washington utilities to meet 5 percent of their retail loads with renewables and conservation by 2009, increasing to 10 percent by 2014.

Such energy portfolio standards are "obviously a pretty contentious issue" despite "a lot of positive things" about them, said spokesman Todd Morrison of the House Democractic Caucus. They represent a significant, complex and conceptually new policy matter for the Legislature, he said. "Anytime you're creating standards, nobody wants it to be a burden on business. That's why it kind of got bogged down. It's hard to please everybody."

The mandatory nature of portfolio standards along with cost worries were troubling for many Washington public-power utilities, said Stu Trefry of the Washington PUD Association.

Although the bill died in the Appropriations Committee, energy portfolio standards theoretically could emerge in another form this legislative session. But, "At this point it's looking like it's not going to make it," Morrison told Con.WEB March 20.

He and others, including Trefry, anticipate portfolio standards will continue to be discussed for the Evergreen State. "It's got legs, just maybe not this session," said Morrison.

Energy Portfolio Standards

House Bill 1544, as originally written, would have required investor-owned and publicly owned Washington utilities to serve 5 percent of retail loads with qualifying renewables by 2010, 10 percent by 2015 and 15 percent by 2023. Efficiency standards would have started with annual program savings equaling three-fourths of 1 percent of retail load beginning in 2005, climbing to 3.75 percent by 2009. A slightly different set of energy-saving requirements would have been in effect from 2010 to 2015.

Sponsored by Rep. Zack Hudgins, a freshman House Democrat from Tukwila, HB 1544 was the subject of a spirited two-hour hearing Feb. 18 before the House Technology, Telecommunications and Energy Committee (see Con.WEB, Feb. 27, 2003).

Supporters promoted the bill and its standards as a way to surmount market barriers to conservation and renewables, generate big economic benefits, diversify Washington's energy supply and stabilize utility energy-saving spending. Consultant Jim Lazar testified the efficiency standards would slightly raise power rates but would substantially lower customer bills, while the renewables standards would have no discernible rate or bill impacts over 20 years. He also forecast $2.2 billion in cumulative savings from HB 1544 through 2023.

But representatives of some utilities, industrial customers and businesses raised concerns and opposition, focused on issues relating to mandates, lack of incentives, reduced local control and potentially high costs.

A revised version of HB 1544 passed the committee on a 9-7 vote in early March. In addition to lowered standards from the original--5 percent conservation and renewables by 2009, 10 percent by 2014--the proposed bill offered exemptions if renewables exceeded certain cost thresholds and for small utilities that would double their Bonneville Power Administration conservation and renewables discount spending.

Hudgins called this substitute bill "a little step sideways" to move energy portfolio standards out of the TTE Committee. But he also acknowledged, in a March 6 interview with Con.WEB, continuing concerns over potentially high costs and compulsory aspects.

The Appropriations Committee didn't act on the proposed legislation before the deadline for bills to be passed out of the House, according to committee analyst Heather Flodstrom. "Things always get resurrected in the wee hours and it could get amended into another bill, but this bill as we know it is probably not moving," she said March 18.

Reactions

Just as the Feb. 18 committee hearing revealed deep disagreements over energy portfolio standards, reaction to the legislation's apparent failure also spanned a range of opinion.

"What we told the Legislature is that we're developing renewables and we're doing a lot of it, and what we were objecting to were the requirements in the bill, the mandates basically, for having a certain amount of percentages by a certain date," said Trefry of the Washington PUD Association.

Utility resource portfolios 20 years in the future are difficult to predict, he said, and it's unclear whether sufficient wind sites would be available to meet the standards. On the efficiency side, "A lot of utilities have done a lot of efficiency already. A lot of the low- and medium-hanging fruit has already been picked. The rest is hard to get, and it would penalize those utilities that have already done a lot."

At the federal government level, tradable tax credits and/or full funding of the Renewable Energy Production Incentive program "would get get more publicly owned renewables [developed] than you would through anything the state would pass," Trefry said.

The PUD association is open to continuing discussions on energy portfolio standards, but, "We're more interested in incentive activity than requirements," he said. And with many Northwest public-power retail rates having risen in the range of 40 percent to 70 percent since the energy crisis, "We're not interested in stuff that's going to raise rates."

At the Northwest Energy Efficiency Council, executive director Stan Price said his efficiency business trade group is "extremely disappointed" in HB 1544's downfall. "An energy diversity standard ... offers both the least-cost approach for serving the electrical energy needs of the state and it creates jobs and much needed economic activity. The energy efficiency goals in this legislation would have stimulated increased business activity in the efficiency industry--that means more energy savings projects at customer facilities, providing both jobs at NEEC member companies and many more jobs for sheet metal workers, plumbers and electricians who do the installation work for these projects."

Price suggested "a broader coalition of support from labor groups and other interests in the state must be forged to impress legislators of both parties that energy diversity is one of the foundations of good energy public policy."--Mark Ohrenschall

More Information:

• Washington State Legislature (includes links to bills and committees)
• Con.WEB Feb. 27, 2003, story on legislative committee hearing on proposed energy conservation/renewable energy standards bill

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Green Energy

Washington Could Meet Load Growth through 2015
With Renewables, Efficiency, Study Says

Renewable energy and energy conservation resources could furnish all of Washington state's projected electric load growth over the next dozen years, according to a new study.

The WashPIRG Foundation assessment found "huge untapped potential" for renewables and efficiency in the Evergreen State, enough to meet the 2,000 average megawatts additional demand forecast by 2015. Washington wind farms could reasonably add 1,260 aMW by that year, and cost-effective energy savings could shrink expected demand by 1,160 aMW.

"We were trying to address the contention a lot of people have that because Washington is so dependent on hydropower there's not a lot of potential for a significant amount of our load to be provided by renewables," said study co-author Robert Pregulman, executive director of Washington Public Interest Research Group (WashPIRG). Renewables and efficiency combined could "easily" meet the state's growing power needs through 2015, he said.

Benefits of this approach include reduced pollution, energy diversity, increased power reliability and economic growth, according to the study. To achieve the potential, WashPIRG Foundation recommended statewide conservation/renewables standards, more tax credits for energy efficiency, denial of permits to any more natural gas-fired power plants, an end to subsidies for natural gas and coal production, and policies supporting additional local control on energy issues.

The study was released in mid-February, as the Washington Legislature was considering an energy portfolio standards bill (see related story). Pregulman said he finds it "very disappointing in Washington that some lawmakers don't understand the importance and the potential that wind energy has, and the fact it is extremely cost-competitive with natural gas," especially as gas prices rise.

Renewables, Efficiency Potential

Hydropower leads Washington's current power generation sources, at 70 percent, according to the WashPIRG Foundation study, citing figures from the Northwest Power Planning Council. Natural gas accounts for 14 percent, coal 8 percent and nuclear 5 percent. Biomass contributes 2 percent and wind and fuel oil both supply 0.5 percent.

Natural gas-fired plants completely dominate the category of under construction and permitted Washington resources, with 2,536 aMW out of 2,643 aMW total.

"Washington has another option," the study said. "The state has excellent renewable energy resources and has been very successful in the past with its conservation and energy efficiency strategies. Washington could meet all electricity demand growth through 2015--2,000 average MW--with wind power and energy conservation alone."

Washington's "enormous wind potential" has been estimated by sources including Pacific Northwest National Laboratory, National Renewable Energy Laboratory, Renewable Energy Atlas of the West and the Tellus Institute.

"We project that Washington wind developers could complete the 405 MW of wind projects currently in development by 2004, then add wind power capacity at an annual growth rate of 20% through 2010 and 15% thereafter," wrote Pregulman and co-author Brad Heavner. This pace, which falls below U.S. annual wind capacity growth in 1999 through 2001, would bring the state's wind capacity to 3,802 MW by 2015, capable of generating 1,255 aMW, the study said.

Solar electricity potential in Washington amounts to 4,800 MW capacity, according to WashPIRG, from Renewable Energy Atlas of the West figures. If the state meets its proportional share of the Million Solar Roofs program goal, 20 MW of new solar electricity will be added by 2010. (Washington has 252 kilowatts of grid-tied solar electric capacity, according to figures shared last fall from Western S.U.N. Cooperative).

Geothermal also has considerable potential in Washington, a roughly estimated 300 MW, but this resource is not included in WashPIRG Foundation's assessment because "all Washington geothermal projects are in the early planning stages." Bio-gas and landfill-gas-to-energy present further renewables opportunities in the state, "but amounts of electricity generated from these sources will be small," the study said.

On the demand side, WashPIRG Foundation called Washington utility energy efficiency efforts "extremely successful" in the 1990s, despite big funding declines in the late 1990s.

Looking ahead, Tellus projected Washington could reduce overall power demand 12 percent by 2010 and 24 percent by 2020 through a wide range of cost-effective efficiency measures. "Although the energy savings outlined in the Tellus Institute study represent real, cost-effective opportunities specifically identified by their survey, to be more conservative we can set a state target of achieving half of those savings," Pregulman and Heavner wrote. "If Washington reaches 6% cumulative savings by 2010 and 12% by 2020, the state will be reducing electricity demand by 720 aMW in 2010, 1,160 aMW in 2015 and 1,650 aMW in 2020."

WashPIRG Foundation also outlined a number of advantages to the renewables/efficiency path in lieu of natural gas-fired power generation. Those include reduced emissions of carbon dioxide and nitrogen oxide, increased diversity and improved reliability of the state's energy supply, expanded economic development and job creation, and cost benefits from energy efficiency ("the cheapest, as well as the easiest, quickest, and cleanest way to address urgent power needs") and fuel-free renewables. Construction times also are shorter for these resources than for fossil or nuclear plants.

State Policy Recommendations

WashPIRG Foundation recommended a number of policies to advance efficiency/renewables development in the Evergreen State.

Standards for both conservation and renewables are a primary suggestion. "In every state that has had significant investment in renewable energy there has been some form of portfolio standards," Pregulman said. WashPIRG Foundation also advocates more state tax incentives for energy efficiency measures.

The study recommended an end to new permits for natural gas-fired power plants. Washington could meet future loads without them, Pregulman said. "We're not making a judgment on all the different ones that have permits now," more than 2,800 MW worth.

WashPIRG wants to end what it called "wasteful subsidies" for coal and natural gas production. And it touts policies enabling more local control and "democratic governance" over energy matters, such as the formation of citizen utility boards. "It's just trying to make sure that the public is included in the process as much as possible," said Pregulman.--Mark Ohrenschall

More Information:

• "Clean, Affordable, Reliable: Energy Conservation and Renewable Energy in Washington"

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Conservation Alliances

Energy Trust Launches Commercial/Industrial
Retrofit Program with Trade Ally Collaboration

The Energy Trust of Oregon's first long-range energy efficiency venture relies on the power of networking.

Building Efficiency offers financial incentives and services for commercial/industrial energy-saving retrofit projects in the Oregon service territories of Portland General Electric and PacifiCorp. The program counts substantially on trade allies--such as energy services companies, equipment sellers, various contractors and building designers--to work with participating customers.

Trust communications/marketing director Jan Schaeffer described the strategy as "empowering all these trade allies as our agents. It's a truly market-driven approach," planned to increase business for trade allies, expand customer energy efficiencies and limit adminstrative/marketing costs while boosting incentive payments.

"We're keeping our focus primarily on the trade allies to deliver the program and our main marketing thrust is to get customers and trade allies together," said Bob St. Amand of program management contractor Aspen Systems. "In a program-related sense, this is the most extreme example I've ever seen of cutting out the middleman."

Stan Price of the Northwest Energy Efficiency Council said he was "very pleased" with the Trust's approach. "The very developed relationship between trade ally companies and their customers has always been a very underutilized network for bringing facility participation to efficiency programs." This programmatic tactic "validates the decision in Oregon to form a new non-profit entity for administration of public-purposes funds, bringing fresh ideas and approaches for fully realizing the potential of energy efficiency in the state."

Launched Feb. 3 and funded at $4.3 million annually, Building Efficiency marks the first of several energy-saving programs originating from Oregon's public-purposes funding agency. A residential retrofit venture also has commenced, offering services and incentives for single-family homes, apartments and manufactured homes.

The Trust, which officially debuted in March 2002, had arranged with PGE and PacifiCorp to continue their efficiency ventures, but those transitional efforts are winding down as Oregon embarks on non-utility control of energy conservation programs for most of the state's electric customers.

Building Efficiency

Many utility energy-saving programs join with many different trade allies, but the Trust's Building Efficiency venture takes an unusually collaborative route.

"The traditional way of delivering programs through utility-sponsored energy efficiency has always been to utilize some form of energy services reps as a middleman between the customer and the contractor who provided the services," St. Amand told Con.WEB. "That model has been changed significantly with this program because we want to try to maximize the amount of incentive dollars available to the public through this program.

"What we're trying to do," he continued, "is build a network of trade allies, have the trade allies deliver the majority of the program, and serve basically as a facilitator for that trade ally network and also to provide for smaller contractors that don't have the ability to do energy audits."

Commercial and industrial customers "will receive full awareness of the opportunities they have to save energy, just like before, and they will receive assistance in identifying installation contractors that can guide them through the rest of the process so they won't be sacrificing any of the benefits they typically expect to get in more traditional energy management" programs, said St. Amand.

Building Efficiency is available to any non-residential Oregon customer of PGE and PacifiCorp, for an existing facility. Although trade allies generally prefer larger energy-saving ventures, "We certainly don't want to give the impression that we're favoring those types of projects over small commercial," said St. Amand. "We'll do everything we can to be very, very evenhanded in the ways the funds are distributed, because they're collected evenly. Our goal is wherever possible to have an even distribution of services across the entire size spectrum." A Trust briefing paper describes the program covering "[a]ll types of office, industrial, retail, commercial and agricultural facilities," along with institutions such as hospital and government buildings, as well as water/wastewater treatment plants.

First comes an assessment of energy efficiency opportunities, through a survey for smaller customers and a technical analysis (from separately qualified contractors) for larger facilities with more complex systems.

Financial incentives include standard offers for energy-efficient lighting (about 20 percent of fixture cost), air conditioning ($80 to $92 per ton of output capacity) and motors ($10 per horsepower). Customized incentives also are available, at 25 percent of installed cost for lighting projects and 35 percent of installed cost for non-lighting technologies such as HVAC systems and building controls. These rebates range from a low of $150 to a high of $100,000 per customer per year, while payback periods for incentive-eligible projects go from 18 months to 10 years, according to St. Amand.

The program's tracking system numbered 66 projects as of March 17, which St. Amand called "a phenomenal response this early on in the program." Customer calls were averaging five or six daily. "I expect that volume to pick up. Right now we're still a fairly new entity. Our biggest challenge is to get our name out there and recognized." He plans to spread the word through trade ally associations, customer groups and other aggregating entities. Already, for example, some 160 Oregon lighting vendors have attended presentations on Building Efficiency.

Trade allies can enroll in the network through a simple application form, although program participation is open to any trade ally. Network membership offers marketing (including customer referrals, a Web site link and other promotional opportunities), training and access to technical help. As of mid-March more than 40 trade allies had joined the network, and several hundred members are anticipated eventually.

Among other program allies are the Oregon Office of Energy and its Business Energy Tax Credit (BETC), which, combined with the Trust's incentives, can significantly lower the initial cost of efficiency improvements. "Granted, in order to facilitate that, you're talking about capital investment" needed from customers, said St. Amand. "The question becomes: Is the price they end up having to pay worth it in this tight economy? Based on the responses we're seeing so far I would say that things are looking pretty good, but we've got a long ways to go and very, very aggressive goals."

The Trust projects Building Efficiency savings of 8.9 average megawatts in 2003 and 2004.

This program succeeds commercial/industrial retrofit ventures operated by PGE and PacifiCorp under transition agreements. The utilities stopped enrolling new customers for those programs as of Feb. 1.

The Trust also is starting a residential retrofit program.

Coming soon are ventures targeting industrial processes and commercial and residential new construction. Natural gas-saving ventures, part of a decoupling arrangement for NW Natural (see Con.WEB, Nov. 26, 2002), and a solar electric program also are under development.--Mark Ohrenschall

More Information:

• Energy Trust of Oregon Building Efficiency program
• Con.WEB special section on Energy Trust of Oregon, March 30, 2002

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That's An Order

Invest in Automated Meter Reading
Technology, IPUC Tells Idaho Power

In a decision that surprised the utility, the Idaho Public Utilities Commission has ordered Idaho Power to invest in advanced meters capable of providing automated meter reading and allowing time-of-use rates.

The Feb. 20 order gave the investor-owned utility until March 20 to submit an implementation plan for putting in the meters, and directed Idaho Power to complete the installations in 2004. But the utility asked for a stay of the March 20 deadline, to allow more consideration of its automated meter reading concerns. The IPUC on March 19 granted the utility's request to postpone the plan, but did not address the utility's AMR apprehensions.

"This order has caught us really cold," said Ric Gale, Idaho Power vice president of pricing and services. "We are hopeful that when presented with the full facts, the commissioners will arrive at a different conclusion," Gale told Con.WEB.

AMR functions and cost are primary issues, said IPUC staffer Randy Lobb. "That's really in dispute right now. What can it provide and what does it cost?"

The IPUC's initial order is related to a report the commission earlier directed the utility to prepare, with the help of its Energy Efficiency Advisory Group, on the viability of residential time-of-use pricing. That report found automated meter reading essential for an effective TOU initiative.

Meanwhile, the IPUC on March 17 approved a residential air conditioner cycling pilot program for Idaho Power, as the second major conservation effort funded with the IOU's demand-side management rate surcharge. The summer-peaking utility wants to test remotely controlled air conditioner cycling as a peak-shaving option.

Metering Metering

The IPUC's order stems from a report on the viability of residential time-of-use metering, which the commission last year directed the utility and its Energy Efficiency Advisory Group to prepare. The report, submitted to the IPUC in September 2002, concluded that some new types of TOU pricing may have viability in the future, but would not be economically viable until the utility acquired an automated meter reading system.

In the report, Idaho Power and EEAG ultimately concluded it would be sensible to pursue a demand response program rather than a TOU program, given the cost of equipment.

At the same time, however, the report indicated AMR technology would ultimately prove cost-effective, said Idaho PUC staffer Randy Lobb. "Comments included in evidence and by intervenor parties concluded that AMR was cost-effective, based on reductions in operations and maintenance costs," he said.

According to the IPUC order, the report said an AMR system would have a positive net present value of $32 million over the life of the equipment. "More specifically, Idaho Power estimated the annualized cost of an AMR system to be about $4 million, but that AMR would save nearly $6 million per year in monthly meter reading and customer movement costs."

Nonetheless, Idaho Power said it could not implement AMR in 2003 because of tight capital markets and lack of funding in its 2003 capital budget. Instead, the utility said it would request 2004 budget approval for the capital needed to begin AMR implementation. The commission disagreed with Idaho Power's decision. "We believe they have the financial ability to do that" in 2003, Lobb said.

The EEAG report pegged the cost of installing standard residential TOU meters at $145 each, or about $47 million for all of Idaho Power's residential customers, while the cost of a TOU meter with AMR capability would be about $72 million.

But in public comments the Demand Response Metering Coalition suggested the report may have overestimated the costs of AMR installation by about $45 per customer, while not taking into account other benefits of adding the technology, such as improved outage management and response, reduced meter reading costs and improved accuracy.

"We do not understand Idaho Power's decision to delay AMR implementation until 2004," the commissioners said in their order. "We believe that AMR should be implemented as soon as possible," starting this year, with completion in 2004. "As a public utility, Idaho Power has the responsibility to keep the rates charged for the services it provides 'just and reasonable,'" the order said. "This responsibility includes installing infrastructure that reduces operation costs funded by ratepayers."

"We don't believe the financial analysis done to determine the benefits of AMR is indicative of Idaho Power's situation," Gale said. "The IPUC does not have a full understanding of our capital budgets." Fulfilling the IPUC's order "would put us in a quandary," Gale added. The utility also believes the IPUC's review process was insufficient. There was no hearing on the issue, he said; rather, the commission used the joint EEAG-Idaho Power report that advised against implementing time-of-use pricing as the basis for requiring the company to acquire AMR technology.

"It was very unusual for the commission to do it this way," he said.

In postponing the March 20 deadline for the implementation plan, the IPUC did not set another specific deadline, saying that it wanted to "further examine" AMR issues raised by Idaho Power. Commissioners indicated they hope to move as quickly as possible, said Lobb.

Another Pacific Northwest investor-owned utility, Puget Sound Energy, in late 2002 ended its landmark time-of-use retail pricing pilot program, which was enabled by automated meter reading technology. A report showed most participating customers paid higher bills than they would have under flat rates (see Con.WEB, Nov. 26, 2002). Lobb noted that Idaho Power has a "vastly different" service territory than Puget, and that the western Washington utility serves both electricity and natural gas customers.

Air Conditioner Program

A new air conditioner cycling pilot program developed in conjunction with the EEAG and approved by the IPUC is designed to test this strategy as a possible means to shrink the utility's summer power needs.

"We're a summer-peaking utility. That's what really has us interested in this," said program specialist Annie Tucher. Air conditioner cycling has been effectively used by some Sun Belt utilities, she said, and Idaho Power wants to learn more about the technology, energy impacts, costs and customer reaction in its territory.

The utility is recruiting 200 volunteers from among residential customers in Boise and Meridian. Participants must own and live in their own homes, and have a single air conditioner run by a single thermostat or compressor.

Each participant will receive a free programmable thermostat, which can be set as desired. These thermostats have a device allowing remote communication with the utility. Each customer can keep the thermostat after staying in the program a full summer. Bill credits of $10 per participating month also will be provided.

The catch: Idaho Power will select 10 weekdays per month during June, July and August on which it will remotely cycle the air conditioner compressors on and off (fans will keep running to keep air circulating). This cycling will occur between 1 p.m. and 9 p.m. for up to four hours total per day, with a maximum of 15 minutes in each off cycle.

"As a pilot program, one thing we're testing is at what point do customers notice the change in temperatures," said Tucher. "Certainly some customers will notice and not mind. Others will notice and mind. Others will plain not notice." The utility expects modest indoor air temperature increases during cycling periods.

Idaho Power plans to select an additional 300 volunteer participants for summer 2004, the second year of the $800,000-plus pilot effort funded by the utility's 0.5 percent DSM rate surcharge (see Con.WEB, May 31, 2002, for a story on the rate surcharge).

As for any long-term air conditioner cycling program, "It's safe to say the company will look very seriously at the results of the test and evaluate it against other resources," said Tucher.--Jude Noland and Mark Ohrenschall

More Information:

• Idaho Public Utilities Commission
• Idaho Power
• Idaho Power residential air conditioner cycling pilot program

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Uncertainties

Kittitas County Wind Farming
Proposals Generate Ambiguities

In December 1998 I attended a dedication ceremony for the Vansycle Ridge Wind Farm in northeastern Oregon.

It was a celebratory and even historic affair, marking the debut of the Northwest’s first large-scale wind project. Cheery speeches were made by representatives of developer FPL Energy, power purchaser Portland General Electric, transmission provider Bonneville Power Administration, turbine manufacturer Vestas-American Wind Technology, Renewable Northwest Project and then-Gov. John Kitzhaber.

And, in a show of the all-around goodwill evident inside the Pendleton Convention Center, local landowner representative Rob Anderson presented FPL project manager Collie Powell (a Jamaican) with a cowboy hat and a tool belt complete with buckle. Powell graciously told of his genuine attachment to the community.

Zip forward in time to another wind energy gathering in another rural Northwest locale--this one not so celebratory, but historic in its own way.

A sizable crowd jammed the Home Arts Building at the Kittitas County Fairgrounds in Ellensburg, WA March 12 for a public information and scoping meeting on Zilkha Renewable Energy’s proposed 181.5-megawatt-capacity wind project northwest of Ellensburg. The evening meeting was conducted by the Washington Energy Facility Site Evaluation Council, to which Zilkha has applied for project approval.

Public comments encapsulated the swirling local controversy over Zilkha’s wind farm plans, from ardent support to fervent opposition, and much in between.

This raging local debate signifies a maturation of the Northwest wind industry, which in less than five years has evolved from a feel-good green novelty to a significant energy resource, with six operating wind farms in the region totaling nearly 450 MW of capacity.

These existing Northwest wind farms have generated little opposition. But Zilkha’s plan, along with a similar nearby project proposed by enXco, blows Northwest wind toward a new and more contentious frontier--nearer to Cascadia population centers and scenic mountain vistas.

It also foreshadows a larger question: What constitutes appropriate wind development? And where?

I find myself increasingly ambiguous about the Kittitas County wind plans.

Personal Connection

First, a personal disclosure.

Although our family lives in suburban Seattle, we frequently visit my wife’s parents and sister at their place just east of Ellensburg. Our kids love playing around this rural property, and the grandparental spoiling is another attraction.

Beyond the family connections, I’ve come to appreciate many aspects of the Kittitas Valley--friendly people, hometown pride, relative quiet, the broad sky and sweeping views from Manastash Ridge to the jagged Cascades, the weather variations from piercing summer heat to chilling winter cold, and the frequent sunshine.

Then there’s the wind. You don’t need an anemometer to know this is a windy place. Just step outside much of the year. I’ve flown a kite into utility lines, listened to symphonies of rustling leaves, seen whitecaps push across local ponds, and watched helplessly as my golf shots were blown crazily around local links.

It makes sense that Zilkha and enXco would find Kittitas County wind tantalizing for commercial production. But it also makes sense that some people would object.

Wind Farming Debate

My father-in-law regularly sends me wind energy-related newspaper clippings from the Daily Record and occasionally the Yakima Herald-Republic. In slightly less than a year this file has bulged to about an inch thick.

Recently I reviewed this hefty pile of news and opinion, culling themes expressed by supporters and opponents of Kittitas County wind projects (if there’s a silent noncommittal camp in this debate, they seem awfully quiet!).

The pro side touts wind as a clean, renewable and indigenous energy resource, a tangible alternative to dirty fossil-fueled power and a local antidote to global warming. Zilkha’s proposed site is considered superb, with consistently strong wind and easy transmission access. Some see spinning wind turbine blades as a beautiful sight.

Wind energy promises big economic development in the county, too, with jobs, leasing income to landowners, millions of dollars in annual property tax revenues and even increased tourism, supporters say. It also would diversify the local economy. And it would require minimal local services compared to sprawling residential development.

On the other side, opponents generally declare conceptual support of wind energy (though some note its intermittency). But Zilkha’s planned location is wrong, they say. Impaired views are a major objection in this mountain-ringed valley. Environmental impacts on flora and fauna, particularly birds, also raise worries. So does disturbed tranquility for nearby residents, turbine noise, fire risk and ice flying dangerously off blades.

Reduced property values are predicted by many wind opponents, along with a slowing of recreation-based growth. Some point out the lack of direct local power benefits from the generated wind power. Wind’s reliance on a federal production tax credit is derided as a tax scam, and some residents fear higher power rates from widespread wind energy generation.

The debate occasionally detours into questions of motive--not surprising for such a controversial issue in a small community.

Zilkha has been portrayed by some as an uncaring, greedy, profiteering outfit from Texas, while some wind opponents have been branded as wealthy landowners from Puget Sound (some living locally, some absentee) playing the NIMBY card to protect their property investment. And these come from public pronouncements. Who knows what people are saying privately?

Many of the above-mentioned issues were aired March 12, along with some others, ranging from the plausible (interference with radio frequencies and cell phone coverage, shadow flicker, raptor deaths that could expand disease-carrying rodent populations, weed proliferation, creating new local wealth without heavy industry) to the extremely unlikely (blades flying off turbines, towers collapsing, Kittitas County views marred by pollution from increased natural gas-fired power generation in the absence of new renewables).

A couple of quotes:

"Wind power, though clean, can be ugly when developed on a significant scale in an inappropriate place," said Gloria Lindstrom of Ellensburg.

"This wind mill [farm] will probably kill fewer birds than my patio door, create less noise than the chickens across the street, and produce less gases than the cows next door," said James Cole of Ellensburg.

Growing Ambiguity

After nearly a year of closely following the great Kittitas County wind debate, my personal opinion is .... a growing ambiguity.

When I first learned Zilkha had sought EFSEC approval rather than the county’s revised wind-siting review process (see Con.WEB, Jan. 30, 2003), my populist instincts arose and scorned the company for end-running around the local community. But Zilkha, it needs mention, publicly announced its intentions in April 2002, some nine months before its EFSEC application. Zilkha people, especially project manager Chris Taylor, have been actively informing local residents of their plans over the past year.

EFSEC, as one local official put it, is Zilkha’s "litigative path of least resistance," compared to the county’s process. This may limit opportunities for opponents to press their case. Yet for this application EFSEC members include a local representative, Patti Johnson, and EFSEC manager Allen Fiksdal promised at the March 12 hearing a "very detailed, very complex, very involved process that will put the Zilkha project under extreme scrutiny in environmental, socioeconomic and other areas," with an environmental impact statement and court-like hearings. He projected an EFSEC recommendation to Gov. Gary Locke by December or January 2004. Locke will have 60 days to approve or deny the application, or send it back to EFSEC for reconsideration.

EnXco is pursuing Kittitas County approval for its proposed 180-MW wind project, which is very close to Zilkha’s proposed site. The California-based company deserves plaudits for local permitting. Yet, this isn’t a simple black hat (Zilkha)/white hat (enXco) comparison. EnXco had not been as publicly open with its plans as had Zilkha before permit filings, and the enXco project actually is closer to the county’s largest city, Ellensburg.

The Kittitas wind dispute is even more multifaceted on private property rights. Nearby landowners have every right to object to development plans affecting themselves and their property. Yet … landowners that would host turbines also have rights to earn income from approved land uses (of course it’s still unknown whether this will be approved). And Zilkha has a right to pay landowners for the privilege of leasing their property, and to pursue its private investment in this project.

So, whose rights are right?

The economic development arguments are equally tangled, and to some extent speculative on all sides--including mine. I can envision a bullish scenario in which Kittitas County wind energy creates substantially increased local prosperity, with all manner of private and public gains from a clean industry. I can also imagine a bleaker future in which local wind farming leads to population migration, property devaluation and other private and public detriments. And then there’s the large middle ground of other possibilities.

On the energy production side, wind is clean, fuel-free and endlessly renewable. But will 360 MW of new capacity really make any discernible impact on overall energy supplies?

Field Research

On the last day of January, I set out from my in-law’s house on a wind research venture.

At the Ellensburg Library, Zilkha’s voluminous EFSEC application showed visual simulations of wind turbines from different vantage points (yes, these company-supplied images should be viewed with a hint of skepticism). My notes range from "none visible" seen from downtown Cle Elum to "very large" seen from a spot 0.2 miles to 1.3 miles away. The deeper visual impression is largely a matter of perspective. I find spinning wind turbines a stunning kinetic sight, while others consider them ugly and obtrusive.

The application covers all kinds of mitigation details (storm water, fire, dust control, traffic, archaeology, plants and animals, aesthetics, light and glare, and more) and notes 18 separate required governmental permits. Zilkha characterizes the proposed 5,000-acre site, with a 90-acre project footprint, as a "hilly rural landscape of rangeland with some scattered residences. The overall population density is very low. Land uses in the area are dominated by open space and cattle grazing." People living nearby may differ in their description.

An environmental section for the project area lists one federally threatened plant species and 97 identified bird species (including red-tailed hawks and American kestrels). Zilkha anticipates zero to four raptor deaths per year. Mule deer, elk and rattlesnakes also populate the proposed site.

EnXco’s application, on display at the county planning department, also features a simulated wind farm view. My notes read "pretty large," but of course, again, it’s perspective.

Driving out of Ellensburg for a look-see of the planned wind sites, on a cold rainy day with low-hanging clouds over the valley, I pass hay farms, ranches and a swollen muddy creek. I think about the West’s long history of resource extraction, and wonder about wind’s place in that continuum.

Eleven miles from town a grove of trees reveals the wind’s force, as most branches lean south. Two miles later transmission lines cross high over U.S. Highway 97, near the southeastern edge of Zilkha’s proposed turbine strings. Wind-monitoring towers come into view. The northerly portions of the site are more forested, closer to the mountains.

From Highway 97 and roughly parallel Bettas Road to the west, there isn’t much evidence of homes--admittedly an incomplete view. The transmission lines and towers are quite prominent, although I suspect wind turbines would be taller from ground to blade tip. The wind machines also would occupy some ridges.

EnXco’s nearby proposed site lies on gently sloping agricultural lands on the northern edge of the Kittitas Valley. I stop at the southwesternmost corner of the site, looking south to Ellensburg and Manastash Ridge beyond. A fresh breeze blows across my cheeks. Driving east, I see a couple of kids playing in a snowbank, cows grazing on muddy fields and flocks of birds flying overhead--as well as some wind-bent trees.

Heading back to Ellensburg in the gathering dusk, I begin to think about ambiguities.

These two proposed wind farms are very close to one another, in location and size. Why is Zilkha so demonized by some opponents and not enXco?

The people who live and own land around the sites deserve the utmost respect and consideration. But of course those folks are sharply divided on wind farms. Hmmm …

Power from these wind farms may or may not flow to local utilities (Kittitas County PUD, city of Ellensburg, Puget Sound Energy, according to my maps). Are there creative opportunities for localized green power? But, wind energy operates in a competitive wholesale market. Hmmm …

Maybe those kids playing in the snowbank will grow up as wind energy supporters, or maybe even developers, contributing to a renewable energy future. Maybe they will simply accept wind power. Maybe they won’t like it. Maybe the enXco project will be denied and this musing will be moot. Hmmm …

I remember an article discussing whether a nuclear power plant could survive a direct hit from a commercial airplane. The horrific implications of that scenario don’t apply to wind power, thank heavens.

But wind is starting to generate more controversy as it pushes siting boundaries, as is clearly the case in Kittitas County, and elsewhere, such as off the Massachusetts coast.

In the end, wind farms in Kittitas County probably fall somewhere between industrial wasteland and clean energy nirvana.

Good luck to EFSEC, Gov. Locke and Kittitas County officials in figuring out where.--Mark Ohrenschall

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Old Idea, New Technologies

Northwest Technology Companies
Target Utility Voltage Control

Energy conservation is normally considered an end-user phenomenon, achieved through energy-conscious practices or energy-saving equipment in homes and businesses.

But the Northwest may become an incubator for resurrecting an old energy conservation idea with new technologies that can be applied from the meter out to the utility system.

Conservation voltage reduction (CVR) consists of power grid practices and technologies with which a utility can manage demand by lowering delivered voltage.

Among Northwest firms active in CVR, MicroPlanet, a Seattle-area start-up company, has hired three manufacturers and set up an international sales network within the last month. PCS UtiliData of Spokane has modified its grid communications and control technology for remote voltage regulation, and over the last year has deployed two systems in two Northwest utilities.

The two firms take very different approaches to controlling voltage on a wide scale, but both hope for a boost from the Northwest Energy Efficiency Alliance's board approval in late January of a $2.8 million market transformation effort to promote conservation voltage regulation (see Con.WEB, Feb. 27, 2003).

Energy savings achieved using CVR vary depending on the utility system and the customer. In various tests of CVR, Snohomish County PUD has averaged between 0.6 percent and 0.7 percent energy savings for every 1 percent in average voltage drop. CVR can also improve system reliability.

Voltage Issues

Because voltage fluctuates under different loads and grid conditions, national standards require utilities to operate within a safe margin of 114 volts to 126 volts.

Robert Fletcher, a chief engineer at Snohomish PUD who has been working with voltage regulation technologies for the past decade, told Con.WEB most equipment and appliances operate more efficiently at lower voltages, as long as the voltage doesn't drop too low to power them. Loads such as light bulbs last longer if operated below their rated voltage. But most utilities keep the voltage relatively high--around 123 or 124 volts--to provide a buffer for sags and dips.

CVR tests started in the 1980s but never made a big impact, Fletcher said. Utilities worried about the consequences of lowering voltage too far and losing stability, and some engineers held that certain loads would draw more electron flow at lower voltage levels. Engineering and capital costs to deploy CVR equipment to the grid were high, and the idea of lost revenue from decreased throughput can make utility managers who are unfamiliar with CVR uncomfortable. But CVR experts say reduced energy demand and rate adjustments that reflect a change in the system with the installed technology can eliminate any financial losses.

Now the idea is starting to resurface, partially because technology has improved as more and different approaches have been tested, and because the energy crisis raised utility concerns over congestion, outages and grid stability. Several Northwest technology companies and utilities are now collaborating and successfully demonstrating more advanced CVR technologies.

MicroPlanet

MicroPlanet founder Greg Wiegand was developing lighting equipment for movie sets in the mid-1990s and simply trying to quiet buzzing dimmers, when he built a miniature transformer with much broader applications.

After consulting with Fletcher he developed the Home Voltage Regulator and Enterprise Voltage Regulator for small businesses that MicroPlanet began marketing this year. Acting as an inverter to stabilize and lower incoming voltage, the basic technology is a little box housing a programmable personal computer board that controls a small transformer. Plugged into a power customer's meter, the devices can stabilize voltage at lower levels, thereby reducing energy consumption.

The Northwest is a strategically good location for MicroPlanet, said company spokesman Robert Kahn. "If you start a product like this in the Northwest and it catches on here ... you're going to have a head of steam coming out with a national marketing program," he said. "People identify the Northwest with high technology and environmental values. A Northwest point of origin is a good thing."

MicroPlanet is looking beyond the local market, however, and working on its first international sale. Scottish Power engineers are testing modified versions of two of the devices as they search for a way to protect some 2,000 rural customers in the United Kingdom from voltage fluctuations when the utility replaces some nuclear capacity with numerous dispersed rural wind projects. If Scottish engineers are satisfied, MicroPlanet hopes a full deployment will mark the company's first major sale. The Alliance project may also mean a deployment of about 500 units, and increased exposure for the technology. In the last month, MicroPlanet has put three manufacturers on standby for orders.

MicroPlanet also has set up a sales network in 30 states and 21 countries to market to utilities, homebuilders and local governments. Partnering and co-marketing with utilities on a large scale is the main route MicroPlanet plans to pursue, because both consumers and energy providers stand to benefit. Consumers save money on energy bills and wear and tear, while utilties benefit from stabilized voltage levels, and can delve into running the distribution grid at a lower average voltage. But the devices currently run $1,150 apiece. The company expects 10 percent of utility customers could pay that back with savings in two years, but chief executive Brian Reidy said the company is aiming for a eventual price of between $300 and $500.

For MicroPlanet, a PC and transformer at the meter could allow the devices to become intelligent, distributed communications ports that let loads converse with grid operators and distributed generators. Reidy said this has been envisioned as a potential product, but basic voltage regulation was chosen for early commercialization because utilities will find it useful regardless of whether distributed generation becomes more prevalent.

Other CVR Approaches

Modifying voltage at the meter is just one method of implementing CVR. Fletcher said other grid enhancements include putting more regulators on distribution lines, adding more capacitors and upgrading lines. These strategies may be cheaper than putting a device on every meter, but many utilities may lack the engineering budget, capabilities or expertise, he said.

Spokane-based PCS UtiliData has designed a system to control voltage using the technology of a SCADA (supervisory control and data acquisition) system. PCS UtiliData has made programmable control systems since 1983, focusing on utilities since the mid-1990s. But when several big SCADA system contracts were cancelled or put on hold during the energy crisis, president Tom Wilson said, the company needed to find ways to respond to market needs.

At conferences and in conversations, Wilson began to see and hear more utility executives interested in technologies to control voltage. The company figured out a way to use its communications and programmable logic control systems to monitor end-of-line voltage and hold it constant by adjusting source voltage at the substation. The system also monitors power flow on the distribution lines "to see if power is actually going down as we lower voltage."

Inland Power & Light Co., an eastern Washington/northern Idaho cooperative, installed the first system on a substation five miles from the PCS UtiliData office in April. The $250,000 system should lower the voltage to about 2,000 customers. Based on energy use data and an estimated voltage reduction averaging 4 percent, Inland Power is estimated to save almost 100,000 kilowatt-hours per year with the system. Utilities served by Bonneville Power Administration can also use the system to apply for credits in BPA's conservation/renewables wholesale rate discount program. BPA supported a second installation on three substations in Clatskanie People's Utility District in Oregon last fall. PCS UtiliData also hopes to benefit from the Alliance program, and is negotiating with several U.S. and Canadian utilities and a military base.

The biggest savings will be seen in dense load centers in urban or suburban areas, with commercial and residential customers rather than industrial users, Wilson said. The biggest utility concern, however, especially for investor-owned utilities, is lost revenue from lower energy use. Because most of the savings go to the customer, Wilson believes utilities should be allowed to incorporate the impacts into their rate structure. "It's OK to not get the revenue for energy that's not being used, but there are also operations and maintenance needs to be taken care of."

CVR companies also say the benefits of lowering and controlling voltage on the system go beyond energy conservation. Along with the technology to lower voltage comes the ability to control it--and to keep it from dropping or sagging too far during grid problems, improving stability.--Ben Gilbert

More Information:

• MicroPlanet
• PCS UtiliData

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