CWEB.099/March.31.2004
Pacific Northwest wind power has dramatically advanced in the past six years, and it faces a future of substantial promise but also signficant challenges.
About 600 megawatts of wind capacity serve the region today--up from virtually zero in 1997-- and another 1,400 MW are reportedly under active development.
Among the reasons behind this growth are competitive and stable fuel-free costs, technology advances, better siting practices, favorable rural reception, improved power integration services, supportive public policies, growing utility and customer demand, and not least, skyrocketing electricity prices during the 2000-2001 energy crisis.
However, new installed Northwest wind megawatts peaked in 2001 and have declined every year since, amid falling power prices, lower demand and reduced energy resource needs.
Looking ahead, regional wind development will be affected by the larger market for new generating resources and the overall economy. Other key influences include federal tax and production incentives for wind power, adequate transmission, utility solicitations and public policies inside and outside the region.
These were among the themes and observations shared in "Northwest Wind Power: A Look Ahead," a March 23 Web/audio conference sponsored by Con.WEB.
Featured presenters were Rachel Shimshak, director of Renewable Northwest Project; Jeff King, senior resource analyst for the Northwest Power and Conservation Council; Virinder Singh, an environmental policy analyst for PacifiCorp; and Robert Kahn, a Washington state-based consultant for wind power developers and manufacturers.
Where Have We Been in Northwest Wind?
The first large-scale Northwest wind project, the 24.9-MW-capacity Vansycle Ridge Wind Farm, went up in 1998 in northeastern Oregon. Next came a 41.4-MW-capacity project at Foote Creek Rim in Wyoming, owned by PacifiCorp and Eugene Water & Electric Board and first operating in 1999.
These followed many years of developmental activities by Bonneville Power Administration, regional utilities and others, and the Council's 1991 confirmation agenda for renewables, Shimshak said.
Northwest wind capacity boomed in 2001, with more than 350 MW installed, largely from Stateline Wind Energy Center, King said. Another 150-MW-plus of capacity was added in 2002 and 2003. Today, more than 600 MW of wind serve Northwest electric customers, approaching 2 percent of regional capacity. "It's gone from nothing to becoming a significant player," said King.
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| Stateline Wind Energy Center (Courtesy of Renewable Northwest Project) |
He attributed the initial projects mostly to interest by utilities and others in demonstrating commercial-scale wind.
King listed other contributing factors to wind's growth, including "very dramatic improvements" in technology; the federal production tax credit and Renewable Energy Production Incentive, which help project economics; discovery of prime sites on "remote, monoculture wheat and grazing land with good wind resources, with the availability of long-term wind monitoring data and transmission near those sites;" integration services to deliver predictable power to utilities; rural community enthusiasm for wind's economic benefits; and retail green power programs. Shimshak also credited green power programs for boosting regional wind; Northwest customers have bought the equivalent of 106 MW.
King and Shimshak both said exorbitant electricity prices during the energy crisis stimulated much of the region's installed wind, but Shimshak said that circumstance "does not provide sustainable, orderly development of this resource."
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| (Courtesy of Northwest Power and Conservation Council) |
More than 400 MW of additional Northwest wind capacity have received permits, she said, and another 1,000 MW or so are in permitting processes.
She also described "the big news on the renewables side on the policy end of things"--numerous Northwest utilities actively seeking wind power, most notably PacifiCorp (with its recent solicitation for up to 1,100 MW of renewables capacity) but also Portland General Electric, Puget Sound Energy, Avista Utilities, NorthWestern Energy, Emerald PUD and Salem Electric. Competitive costs and hedging against natural gas price risks (valued at an estimated 0.5 cents per kilowatt-hour) have boosted wind's stock for utilities, she said.
"We are making progress, but if customers and utilities are going to benefit from the stable rates associated with these resources that have no fuel costs, we probably need to do more," she said.
New Wind Dwindling
Despite impressive overall growth since the late 1990s, new Northwest wind has dwindled considerably since 2001. The backdrop is substantial capacity additions earlier this decade, declining wholesale power prices and reduced regional demand, King said.
Another significant impediment for wind power development, in the Northwest and beyond, is the 1.8 cents per kilowatt-hour federal PTC that expired at year-end 2003. Singh called this "the most infamous of policy uncertainties" for wind power, while Kahn said, "In the melodrama of wind power held hostage, we're on day number 83 without a solution quite in sight as to how to achieve extension of the absolutely indispensable production tax credit."
Meanwhile, all four presenters listed transmission as a vital issue for regional wind power's future.
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| (Courtesy of Northwest Power and Conservation Council) |
"It is … the most serious hurdle to the robust development of resources in the Northwest," said Kahn.
This covers access to non-firm space on existing lines; he wants more information shared by large transmission owners such as BPA and PacifiCorp on "what's available on that system, and when."
Kahn also advocated new transmission capacity to link wind resources east of the Cascades with load centers west of the mountains.
Singh also supported stringing more wires for wind. "The West has tremendous potential for wind," he said; some 20,000 MW is possible in 10 years. However, "We are just starting to bump up against limits on capacity in our transmission system. We need to expand transmission, to get out to wind sites … Underlying the whole thing is who pays. We have to make sure all beneficiaries, including customers, pay for transmission upgrades and it's not loaded onto one or two entities."
Both Kahn and Singh advocated formation of an independent operator for the regional tranmission grid.
"We have a balkanized wind system with no clear guidance on how to move forward," Singh told the conference. A regional transmission organization, or RTO, could make better use of existing lines, cohesively oversee many systems and offer price signals for transmission upgrades and cost allocations.
PacifiCorp also endorses a national renewables portfolio standard, as a way to reduce fossil fuel use, help lower the cost of renewables, reduce utility risk of cost disallowance, lessen exposure to different state policies and help spur development of the renewables market.
Singh outlined a "potentially fantastic dynamic for renewables" in the Northwest, in which utilities solicit renewables fairly, regulators approve cost recovery, communities support wind farms and customers buy renewables.
Oregon and Washington possess "good cultural dynamics that should be cultivated," Singh said. People in metropolitan areas along the Interstate 5 corridor support and are willing to pay for renewables, while communities east of the Cascades want to host renewables. "It traverses policy and ideologies and culture divides," and should be translated into state policies.
Five Fundamentals
Consultant Kahn discussed what he called "five fundamentals that really drive development of wind power, wherever it is going to be developed, and certainly in the Northwest."
One is determining sufficient wind resource for commercial energy production, generally defined as 16 mph or greater annual average wind speeds. This is "a major expense" for wind developers, he said, but worth the investment. In Oregon and Washington, "Those sites worth having are under the control of credible developers, by and large," which he thinks will lead to more wind development in Idaho and Montana. He also sees a shift toward increased wind development on public lands.
Developers need control of prospective wind sites, through equitable leases with landowners. Interconnection arrangements are part of this fundamental.
Permitting is a third essential, and Kahn said it behooves developers to "be very realistic on what kinds of problems and challenges they have bought themselves into," from wildlife species to noise issues to opposition from nearby residents.
Utility power purchasing is another important element. "We're seeing a real cultural shift on the part of utilities, coming to recognize wind power is for real, and definitely worth the investment," he said. "We're beginning to shift from a hard sell to one in which the utilities will even move from a [power purchase agreement] to a willingness, a real interest in buying the wind farm outright." He predicted utility wind farm purchases in the Northwest within two years.
Kahn described Montana as "the great underachiever" in wind purchasing in the region.
Looking Ahead
Shimshak said policies have evolved to shrink barriers to wind supply. "Where we really need to focus policy direction is on demand," notably boosting the retail green power market, she said.
King said a Council base case resource forecast envisions some renewables development from public policies and funding in coming years, but no mandated and market-driven new wind development until 2011. He noted this is a regional perspective--"the circumstances for individual utilities will clearly differ."
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| (Courtesy of Northwest Power and Conservation Council) |
PacifiCorp, for example, through a rigorous and public integrated resource planning process has found wind to be a least-cost, low-risk resource, according to Singh. Integration costs are estimated at 0.5 cents/KWh, based on a 20-percent penetration level for wind. "Integration costs shouldn't be something that stops people moving forward with wind," he said.
In other discussions, presenters rued the demise of BPA's landmark 2001 solicitation for 1,000 MW or more of wind (even though the federal power marketing agency has separately acquired some wind power).
Kahn called BPA's initial request "awe-inspiring. The results, of course, have been hugely disappointing. At the end of the day, though, in my opinion, Bonneville's real contribution to wind power development will come in the integration it provides into the transmission sysstem and its ability to help contribute to future expansion and management of the transmission system." Singh called on BPA to join a Northwest RTO, and Kahn agreed BPA's participation is essential for one to materialize.
Presenters also addressed potential wind development along the Oregon or Washington coasts. A few such exploratory proposals are in the works in Oregon, Shimshak said, and Singh said some coastal counties might be interested in the tax revenues. But Kahn thinks coastal wind development poses huge siting and transmission issues. "The very quality that makes the Northwest such a logical place to market wind power, our environmental values, would be the very same thing that would make permitting that project well close to, if not impossible, exceptionally expensive," he said.--Mark Ohrenschall
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Montana's first utility-scale wind farm may be a relatively small project generating power for Idahoans.
A 9-megawatt-capacity wind venture is proposed by United Materials of Great Falls, a gravel supply and construction company that has agreed to sell wind energy to Idaho Power over 20 years, as a qualifying facility under the federal Public Utility Regulatory Policies Act (PURPA). The power sales agreement--pending before the Idaho Public Utilities Commission--includes payment variations based on actual power deliveries and the utility's seasonal needs.
Horseshoe Bend Wind Park is scheduled to start operating by year's end, although a top United Materials official told Con.WEB the project is contingent on a reinstated federal wind energy production tax credit. The company plans to use this renewable energy venture to connect to the power grid and end its reliance on diesel-fired generators. Exergy Development Group would develop the wind project, according to Montana news reports.
If Horseshoe Bend begins production in 2004, it would likely be Montana's inaugural commercial-sized wind farm. NorthWestern Energy is eyeing wind power from two proposed Montana projects, but neither is expected to spin out electrons until at least 2005 (see Con.WEB, Feb. 27, 2004). NorthWestern would transmit Horseshoe Bend energy to Idaho Power.
This would also represent Idaho Power's first large direct purchase of wind energy.
And in another noteworthy twist, the Idaho investor-owned utility has asked state regulators to clarify that developers own the environmental attributes (also known as green tags) of PURPA QF projects. However, PacifiCorp has objected to that idea, believing such attributes should belong to the utiliity, according to IPUC staffers. The commission has not yet ruled on this matter.
Horseshoe Bend Wind Park
United Materials' primary business is supplying gravel and construction work, board chairman Bob McIntyre told Con.WEB. The wind project arose by circumstance.
The company's gravel pit lies a few miles outside the Great Falls city limits, beyond the NorthWestern grid, McIntyre explained. Diesel generators power the entire facility.
"What was needed was a substation and an overhead line to come over here and get to our plant site," but that would cost United Materials more than $1 million, he said. "We started looking at ways to get that infrastructure built and not have to absorb all of the cost ... That's the way we came onto the wind market."
Intermittent wind is impractical for the company's own power supply, but United Materials officials realized a small wind farm could enable the facility to connect to the grid. "The wind power just kind of came to us as a means to accomplish another end," McIntyre said.
As proposed, Horseshoe Bend Wind Park would consist of six General Electric 1.5-MW-capacity turbines, sited on United Materials property about a mile from the gravel pit. McIntyre described the site as a bench slightly elevated above Great Falls.
The central Montana city is "legendary" for its wind, Cascade County commissioner Peggy Beltrone told Con.WEB. Recently, winds blew down a 15-foot-tall Lady Justice statue outside the county courthouse.
Wind energy development has become a local priority, she said, in the context of outstanding wind resources, bankrupt NorthWestern and PPL Montana's protest of taxes on the power plants it bought from Montana Power. "We're in a situation where anything we can do to encourage additional and stable energy climate for our community is at the forefront for our economic development strategy."
Cascade County in early March approved a commercial development permit for Horseshoe Bend, after reviewing such common wind issues as bird impacts and noise, Beltrone said. She said the proposal generated minimal local concern; one neighboring landowner complained about the effects on potential subdivision development, and for another landowner near the project site, United Materials agreed to install a berm to shield turbine views.
This limited controversy is partly due to industrial activities already present in the vicinity, Beltrone said. She also noted Montanans are enthused about wind energy, and about putting the state's bountiful breezes to productive use.
In addition to siting approval, McIntyre said United Materials has secured private financing for the wind farm and substation/power line development.
However, McIntyre cautioned his firm won't move forward with the venture until Congress approves a new wind energy production tax credit, after the previous PTC expired in December. The power sales agreement allows the company to bail out on 60 days notice, absent a PTC, and before project construction starts.
Power Purchase Agreement
United Materials also has an essential piece for any wind project--a market for the generated power.
The company and Idaho Power reached formal agreement in January on a 20-year power sales deal, which the IPUC was still considering as of Con.WEB deadline.
Idaho Power spokesman Dennis Lopez noted the IOU is obligated to buy power from eligible PURPA projects. "They've come to us with a proposal, and they're willing to accept the contract put together," he said. The utility has another PURPA contract with a 90-kilowatt-capacity wind producer near Boise, he added.
Other wind also may appear in the utility's resource future. John Prescott, the utility's power supply vice president, told the Idaho Energy Conference in November about the "potential we will have wind as part of our portfolio going forward."
McIntyre described Idaho Power as "the most amenable" potential Horseshoe Bend power purchaser. "We have checked other sources," he said. "Idaho Power is our first choice."
The 9-MW size reflects economics, McIntyre said. "That's about as much as we cared to finance into this operation, and it produces a good amount of power. And it pencils out economically as far as an investment."
It also falls just under the 10-MW limit for Idaho PURPA projects to receive IPUC-approved avoided cost rates. "As we progressed the size that we were proposing just dovetailed very well into the ... abilities to sell to Idaho Power under QF," said McIntyre.
Under the agreement, the price for wind energy would vary by season. In March, April and May, the price would start at 3.36 cents per kilowatt-hour in 2004, rising to 5.5 cents/KWh in 2025. For June, July, November and December, the tab would start at 5.49 cents/KWh in 2004, increasing to 8.99 cents/KWh in 2025. And for August, September, October, January and February, Idaho Power would pay 4.57 cents/KWh in 2004, expanding to 7.49 cents/KWh in 2025.
These so-called base energy rates would apply to generated wind power "that falls within a band of 90-110 percent of the [United Materials-]estimated monthly generation amount," according to IPUC staff comments.
If actual wind-generated power exceeds 110 percent of estimations in a month, United Materials would get a market-based surplus energy price for those added electrons. If wind-powered electrons dip below 90 percent of projected delivery amounts for a month, a shortfall energy payment would be applied against the base energy price.
"The provisions will encourage United Materials to provide energy with a greater degree of 'firmness,' while at the same time allowing a reasonable amount of flexibility to United Materials in operating its facility," wrote IPUC staff. "The provisions require QFs using various generating technologies to actually perform on a firm basis to receive the posted firm rates ... for firm energy not delivered, the provisions help insure that Idaho Power pays no more than if it purchased equivalent energy from the market."
However, some other QF developers have expressed concerns about the shortfall penalties, according to IPUC staffers.
Commission staff endorsed the proposed power sales agreement, although it recommended "that those non-standard terms unique to this contract (i.e. encouraging increased firmness, and seasonality) not be viewed as precedential."
United Materials has arranged for NorthWestern to deliver hourly firmed power to Idaho Power's system, at the 161-kilovolt Jefferson-Dillon line.--Mark Ohrenschall
Calpine's proposed Fourmile Hill geothermal project has won a key legal challenge, but whether Bonneville Power Administration still wants to buy its potential 49.9 megawatts of geothermal power is uncertain.
A U.S. District Court judge ruled in February that federal agencies properly followed procedures in approving Fourmile Hill, although the judge did not address substantive issues for those consents.
Calpine considers the decision another validation of the project, but Fourmile Hill opponents declared the ruling was too narrow, and they may appeal.
Meanwhile, BPA officials are pondering continuation of a 2000 Fourmile Hill power sales agreement, after Calpine missed a year-end 2003 deadline to prove a commercial resource.
Fourmile Hill Ruling
The narrow ruling handed down Feb. 13 by U.S. District Judge David Levi focused on procedural compliance, and left aside questions about the "substance" of Fourmile Hill approvals by the federal Bureau of Land Management and Forest Service relating to project leases on the Medicine Lake Highlands in north-central California.
"The court's role is to review compliance with these procedures, not to review the substance of agencies' decision," Levi wrote in his decision.
The case was filed in June 2002 in the U.S. District Court for the Eastern District of California by the Pit River Tribe, along with the Native Coalition for Medicine Lake Highlands and the Mount Shasta Bioregional Ecology Center. It came after two years of administrative protests of the May 2000 project approval were exhausted. At issue for the plaintiffs is geothermal development they believe would degrade or destroy Indian religious and cultural uses of the area. Opponents also have feared local environmental qualities would be jeopardized by the venture.
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Calpine views the Levi decision as "yet another affirmation of the project," according to company spokesman Kent Robertson. He said Calpine is confident in prevailing in further legal challenges to Fourmile Hill, as well as to nearby Telephone Flat, another prospective geothermal project in the Glass Mountain Known Geothermal Resource Area.
"Those projects have been upheld in every one of the several administrative and court proceedings that opponents have pursued to date," he said.
Robertson said Calpine is evaluating plans for resource verification at Fourmile Hill; the company conducted exploratory drilling before the 2002 lawsuit, and found promising results.
The company also plans to try to meet with Pit River members to address their concerns.
"While past efforts to resolve these issues outside of the legal process have not been successful," Robertson said, "Calpine maintains the belief that the projects can proceed in a fashion that takes into account the spiritual value of the region as well as the multiuse character of the public lands."
BPA Power Purchase Agreement
Even with the favorable legal decision, BPA's power purchase agreement for Fourmile Hill power remains in limbo.
"The ruling doesn't have any effect on our agreement with Calpine," said BPA spokesman Ed Mosey. "They had certain requirements to meet before the end of the year (2003), and none of them involved bringing in a completed project. They were mainly to do with proving up the resource, which they failed to do."
Mosey said BPA was in a "deliberative mode" on the matter, and had not yet made a decision about the future of the agreement. The deal, announced in December 2000 (see Con.WEB, Dec. 21, 2000), calls for Bonneville to buy up to 49.9 average megawatts over 20 years at a cost of 5.7 cents per kilowatt-hour.
Project Opponents Ponder Appeal
Deborah Sivas, an Earthjustice attorney representing the plaintiffs, said her clients were "looking seriously" at appealing the decision to the U.S. Court of Appeals for the 9th Circuit.
"Our clients, particularly the Pit River Tribe, are very disappointed in the ruling," Sivas said. "But we think we have good grounds for an appeal.
"We think the judge was incorrect, in general," she said. "Full disclosure of the impacts was required, and we don't think there was full disclosure."
Sivas said the project should have paused for tribal consultation; instead, it moved forward and precluded consideration of cultural and historic issues.
The problem with that, she said, is that by the time project decisions are being made, mandated federal environmental studies tend to be formalities, and projects are generally approved. The critical checkpoints to avoid this were before the Medicine Lake leases were created and, later, when they were extended. "We're looking very carefully at that" as a basis for an appeal, she said.
She also noted no commercially viable resource has yet been demonstrated at Fourmile Hill. "There's no use destroying the landscape in this case," she said. "One of the thoughts we've had is that the leases could be bought out if they turn out not to be producible."
Sivas said action threatened against Calpine's proposed Telephone Flat project was still a possibility.--Rick Adair
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New and expanded fossil-fueled power plants in Washington will be required to mitigate some of their carbon dioxide emissions, potentially through energy efficiency and renewable energy projects.
These CO2 mitigation mandates were signed into law by Gov. Gary Locke on March 31, after passing the state House of Representatives and Senate by large majorities.
Bill sponsor Rep. Jeff Morris called this "landmark legislation." The Evergreen State joins Oregon among a handful of states regulating CO2 emissions from power plants.
However, Robert Kahn, executive director of the Northwest Independent Power Producers Coalition, believes the bill will have little initial impact because Washington has "a backlog of already permitted natural gas plants."
Under the bill's provisions, an efficient 650-megawatt-capacity natural gas-fired plant would pay or invest an estimated $380,000 annually over 30 years for CO2 emissions, or about $11.4 million total, according to a legislative calculation. Eligible mitigation includes energy efficiency, transportation, renewables and carbon sequestration.
Washington lawmakers also endorsed a bill calling for a state strategic plan for renewables/efficiency business development, including recommendations for policies and funding. The legislation also directs state agencies to facilitate, promote, encourage and assist renewables/efficiency. But the bill contains no state financial support. Locke signed this legislation March 26.
Meanwhile, proposed solar manufacturing tax breaks and production incentives for customer-generated solar and wind power failed to survive the legislative session.
State Sen. Bob Morton, a leading proponent of those bills, told Con.WEB he was "very disappointed that they did not make it onto the system." The Republican lawmaker plans to try again in 2005.
This legislative solar eclipse also may affect a solar manufacturing company's reported interest in locating a plant in rural northeastern Washington.
Mitigating Carbon Dioxide, Strategizing Efficiency/Renewables
House Bill 3141, with its expressed goal of "mitigating carbon dioxide emissions resulting from fossil-fueled electrical generation," passed the House of Representatives 69-26 and received Senate approval on a 40-6 nod.
Morris said the bill represents a major evolution. "Not more than three years ago, many members of the Legislature were reluctant to admit that CO2 even existed," he said. "Now we have mitigation measures in place that will ensure we are making our contribution to reduce global warming and giving the business community certainty for investment by having one clear standard."
In comments reported by the Tri-City Herald newspaper, Bill LaBorde of the Northwest Energy Coalition said it was "great the state is finally acknowledging global warming." State Sen. Pat Hale called it "a vote for the devil that's known versus the devil that's unknown."
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| Fossil-fueled Power Plant |
The bill stems from an Energy Facility Site Evaluation Council proposal to establish standards for CO2 mitigation from fossil-fueled power plants. "The EFSEC has been applying CO2 standards on an ad hoc basis. Applicants need standards so they know what is expected of them as they enter a project," according to a House Bill Report's summary of legislative testimony supporting HB 3141.
The bill report noted considerable debate and numerous concerns over specific issues, "including the price per ton for mitigation, sufficient credit for cogeneration, credit for mitigation [of] other greenhouse gases, the method for adjusting the rate, and the lack of an option for annual payments."
As passed by the Legislature, HB 3141 applies to new fossil-fired plants of 25 megawatts or greater, with new defined as applying for approval after July 1, 2004. It also affects existing plants that plan to increase CO2 emissions by 15 percent or more, according to the bill report.
These facilities must mitigate 20 percent of their CO2 emissions over 30 years through one of three options: pay a qualified independent entity; buy permanent carbon credits; or invest in their own mitigation ventures (including cogeneration). A 60-percent capacity factor is used in determining emissions, according to the bill report.
The going rate for payment to a qualified third party is $1.60 per metric ton of mitigated CO2, a price EFSEC can adjust periodically by as much as 50 percent. Direct mitigation investments need approval, and can't be required to cost more than $1.60 per ton.
Among the potential mitigations are "energy efficiency measures, clean and efficient transportation measures, qualified alternative energy resources, demand side management of electricity consumption, and carbon sequestration programs."
Also earning final legislative approval was Senate Bill 6146, "[r]elating to encouraging renewable energy and energy efficiency businesses in Washington."
This unanimously passed bill calls on the Washington Technology Center, through its Northwest Energy Technology Collaborative, to "develop and implement a strategic plan for public and private collaboration in renewable energy and energy efficiency business development." The plan is due to state elected officials by Jan. 1, 2005, and must include recommendations on state policy changes and legislative funding.
SB 6146 also directs state agencies to facilitate efficiency/renewables projects, promote supportive policies, encourage utility and customer investments, and assist in developing stronger markets for renewables and efficiency.
Solar Bills
Two solar-related bills mustered some legislative support, but not enough for passage.
SB 6132 would have provided tax breaks for solar manufacturers; it was especially targeted at plants locating in rural Ferry or Kittitas counties, according to Morton. It unanimously passed the Senate late in the session, but the House didn't act on it before adjournment. The bill's provisions also went into the Senate's proposed supplemental budget, but failed to make the final cut in House-Senate budget negotiations. Fiscal constraints came into play, legislative staffers told Con.WEB.
Meanwhile, SB 6131 would have offered production incentives for solar or wind power generated by individuals, businesses or local governments on their own property. Proposed incentive levels started at 20 cents per kilowatt-hour for solar or wind equipment made outside of Washington, and rose as high as 48 cents/KWh for solar PV inverters and modules manufactured in the state. This bill passed the Senate Natural Resources, Energy and Water Committee, but expired in the Ways and Means Committee.
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| Washington state capitol in Olympia (Courtesy of Washington Legislature Web site) |
Morton, the prime sponsor of SB 6132 and a leading co-sponsor of SB 6131, rued the demise of these bills, even in the context of a short legislative session and budget limitations.
"They offer us great opportunity to be able to supplement our electrical energy needs, and they open the door for a company to come into this state who actually would be manufacturing the solar panels," he told Con.WEB.
That would be RWE SCHOTT Solar, which Morton and others confirmed has eyed a solar manufacturing plant in the vicinity of Republic, in rural northeastern Washington's Ferry County. "For the company to seriously commit to putting in a facility here, they wanted both bills," one to help its own economics and the other to benefit potential solar customers, Morton said.
The firm reportedly discussed initial employment of 15 people, which for Ferry County would be the proportional equivalent of adding 7,000 jobs in populous King County, according to Morton.
RWE SCHOTT officials could not be reashed for comment.
A leading Washington solar proponent believes he and other supporters didn't make their case well enough to key legislators. "We failed to get the information they needed to make the best decision on behalf of the citizenry," said Mike Nelson, photovoltaic project manager at the Washington State University Energy Program. "Basically we could have presented the economics and jobs case more successfully," and better stressed the immediacy of the RWE SCHOTT opportunity.
He and Morton both pledged to pursue solar-related state legislation in 2005. "We're going to go for it again next year," said the senator, after determining "any weaknesses that need to be corrected and [how to] fortify the strengths."--Mark Ohrenschall (Lynn Francisco also contributed to this article)
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Ken Baker has long extolled the virtues of energy and resource efficiency. Now he's living it--or, rather, living in it.
The Idaho energy consultant and his family recently moved into their new Boise foothills home, which Baker designed as a green residence, using the U.S. Green Building Council's Leadership in Energy and Environmental Design (LEED) commercial standards as a guideline for green decisions.
It features energy-saving measures that combine to beat Idaho's residential energy code by nearly 30 percent, along with environmentally friendly building materials, natural landscaping and erosion controls.
The 2,250-square-foot home on 5.2 acres easily exceeds Energy Star residential standards. Baker, who also served as his own general contractor, figures his incremental cost for building green at slightly more than $2,000, mainly for energy features. He estimates a total house cost of $87 per square foot, less than the $95-$110 per square foot common for local custom homes. "I made out pretty well. By acting as my own general [contractor] I was able to build in the green measures and still realize significant equity in the home."
Baker brought to this project a long background in building and energy efficiency, and a desire to put ideas into his own built environment.
"These are things I've ... been thinking about since 1977," said Baker. "This was an opportunity for me to see how much of this whole green design I could implement into my building."
He highly recommends a green home--for such benefits as comfort, durability, resource efficiencies and good quality indoor air. He also suggests that people considering building green should hook up with knowledgeable and experienced professionals.
Baker shared his experiences at an Idaho Energy Conference session in November, and in a later interview with Con.WEB.
Going Green
Baker approached his family's new green home with extensive relevant experience. He earned a master's degree in architecture, designed and built energy-efficient homes in the 1980s, and served many years with the Idaho Department of Water Resources Energy Division. His current consulting work includes energy efficiency education and planning, and energy code training and coordination.
"If anyone understands energy efficiency, I should at least be one of those," he said.
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| (Courtesy of Ken Baker) |
For his home, Baker relied largely on LEED commercial criteria; LEED residential standards are under development, but not yet available. "I used the LEED 2.1 as a guideline to question my green decisions on the house," he said.
LEED's rating system for new commercial buildings covers six categories, totaling 69 possible points. Energy and atmosphere account for the highest percentage of potential points (17), followed by indoor environmental quality (15 points), sustainable sites (14 points), materials and resources (13 points), water efficiency (5 points) and innovation and design (also 5 points). Baker said he used the first five of those six categories.
Energy Features
Energy efficiencies can earn 39 percent of total LEED points, Baker noted, and his new home reflects much attention to limiting power use.
The Baker domicile exceeds Idaho's residential energy efficiency standard--the 2000 International Energy Conservation Code--by 29 percent. Energy-saving measures added about $2,000 to the home's cost.
Insulation accounts for most of that incremental cost. Baker opted for R-24 insulation for exterior walls (code is R-17), R-44 for ceilings (R-38 is required) and R-30 under floors (R-19 is minimum). He thought about--but eventually decided against--spending an additional $2,000 for an inch of rigid foam on the home's exterior, which would have brought the home to 39 percent above code requirements.
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| (Courtesy of Ken Baker) |
Low-emissivity windows in the Baker home rate from 0.31 to 0.35 U-values, well below code standards of 0.45. They allow plenty of daylight inside but limited solar hear gain. These windows came at no cost premium.
"We were able to do a lot with windows and insulation," Baker said.
The Bakers' gas-fired furnace is rated at a high 92-percent efficiency, with a 10 Seasonal Energy Efficiency Ratio (SEER) for cooling. Hard ducts (not flexed) are sealed tight with mastic.
The home also sports a central air conditioner with 2 tons capacity--down from 5 tons recommended by an HVAC contractor. But Baker expects the AC won't crank on very often.
"My house is designed to be passively cooled," he explained. In addition to the insulation and window features, transom windows on the second floor can be opened to help warm air escape at night. Boise's average summertime high and low temperatures vary by 35 degrees, he noted.
Baker contemplated evaporative cooling, but chose the softer path for cooling. Passive solar heating offered another option, but that requires a thermal mass inside, and he wanted a more open floor plan.
He anticipates annual heating bills of $200 and very little for cooling. Estimated simple payback for the heating/cooling elements is two to five years, primarily for insulation and the gas furnace.
Also on the energy side, the Baker residence sports Energy Star-qualified appliances, along with compact fluorescent lamps, although he couldn't put dedicated CFL fixtures everywhere.
Baker said he didn't look at renewable energy sources.
Other Green Elements
"I knew energy efficiency; on that side I could take care of things pretty well," Baker said.
Green materials, however, proved more challenging.
Recycled carpet was readily and locally available, at $28 per square foot. Paints with no volatile organic compounds also were easily acquired.
But not linoleum. Baker liked the components of linseed oil and cork products, but discovered this linoleum came from Germany, adding substantially to embodied energy. Vinyl became his flooring choice for two bathrooms and a utility room.
He also wanted to find local slate for some flooring, but learned that tile is more environmentally benign. For hardwood flooring sections Baker went with American-grown maple, which is non-local, but also isn't imported from overseas. The maple flooring sports a water-based finish, as an indoor air quality benefit.
The exterior cedar siding comes from Idaho.
Outside the home, Baker is nurturing what he called "a fairly natural habitat," with rabbitbrush, sagebrush and other native plants, such as grasses and wildflowers. "Most of the site is just naturalized," he reported. That saved him $2,000 for sod.
Baker also crafted an erosion and sedimentation control plan, as required by LEED and for Boise city developments in the foothills and/or on parcels larger than 1 acre. During construction, as one example, driveway rocks kept vehicles from tracking mud off the property.
A perimeter drain encircles the entire house, to collect water.
This site work cost Baker $650 and delayed construction more than two months, which added $7,000 to the project cost. But, he noted, "There is a real reason for doing this" as a green building practice--to minimize runoff and erosion.
Advice for Others
Asked about advice for others contemplating a green home, Baker replied, "The first thing I'd say is, 'Do it. You're going to find it worth doing,'" for such benefits as better indoor air, more comfort, longer-lasting materials and energy bill savings. He also counseled people to "talk to someone who's knowledgeable, who's done this before."
He thinks energy-efficient aspects are more known and understandable than other green elements; demand for the likes of low VOC paints and recycled carpet "comes mostly from the clients."
Baker also thinks green is relative. "As much as I have done to make it green, I'm still not satisfied that it is," he said. "I still think we have a long way to go to truly make our houses green. And we haven't even begun to talk about the size of the house itself."
He acknowledged that when he sees a small dwelling, "I actually get a warm feeling in my stomach: 'That's more like it.'"--Mark Ohrenschall
Light-emitting diodes (LEDs) are steadily making inroads into niche and specialty lighting markets.
But the Valhalla for LEDs--highly efficient white lighting for general illumination--is still several years and a lot of research away, according to lighting market observers.
"The big apple is general illumination. Everyone is biting at the bit and going after it like hungry hounds. We're anxious. The problem is that the technology is not quite there," said Bill Ryan, Philips Lighting's LED group product manager and self-styled LED "guru." In the meantime, companies such as OSRAM SYLVANIA, Lumileds Lighting, Permlight Products and GELcore are touting their wares in niche lighting markets such as exit signs, traffic signals, roadway and airport lighting, motor vehicles, commercial signage and accenting.
"As we continue to improve the performance of both colored and white LEDs, there will be an increasing number of new applications that make economic sense," Scott Hearn, chief executive of GELcore, a joint venture of GE Lighting and EMCORE, said in response to written questions. For example, GELcore plans to introduce a white LED this year designed to replace incandescent lamps in illuminated street signs.
LEDs save considerable energy compared to incandescents, and last much longer. They also offer some functional advantages as a small, focused light source. However, widespread LED adoption faces an assortment of cost, technological, informational and even psychological hurdles.
LED Technology, Potential, Barriers
A light-emitting diode is a semiconductor that gives off light when a current is applied. The light chip is encased in a package that includes a heat sink, wire leads and a light reflector. LEDs produce different colors depending on the metals used to "dope" the semiconductor's crystalline base material.
The U.S. Department of Energy has taken notice of the energy savings potential of LED lighting. The department's solid-state lighting research program has allocated nearly $25 million to develop new materials and phosphors.
DOE estimates that aggressive investment in solid-state lighting research could save more than 600,000 average megawatts of lighting energy between 2005 and 2025, reducing energy bills by more than $128 billion.
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| (Courtesy of Lighting Design Lab) |
A Northwest Energy Efficiency Alliance 2003 market research report said LED lighting could replace an estimated 25 percent to 30 percent of incandescent lighting by 2025. LED lighting has significant cost-saving advantages over incandescent lighting, including efficiency and longer life. "In exit signs and traffic signals, for example, red LED systems demand only 10 to 15 percent of the input power that an incandescent light source system would require," the report said.
LEDs can last up to 100,000 hours, 100 times longer than a comparable incandescent lamp and five to 15 times longer than a fluorescent lamp, the Alliance report said.
Technological and information barriers stand in the way of more widespread use of LED lighting, according to the Alliance report, which lists problem areas such as costly fabrication methods and unfamiliarity with LEDs among lighting designers, installers and building code officials.
Traffic Signal Market
Traffic signals are a niche market in which LEDs are taking hold. GELcore's Hearn estimated the lights have a two-year payback after installation, and forecast LEDs will capture 40 percent of the U.S. traffic signal market by this year. Converting all 3 million U.S. traffic signals to LEDs would save 342 aMW annually, the Alliance report estimated.
Although LED traffic signal lights may initially cost 50 to 100 times as much as the $2 to $2.50 price tag for standard incandescents, LEDS use only 10 percent to 20 percent of the electricity of incandescents, and last five to 10 times as long.
Seattle City Light began installing red traffic signals in 1997 because "it was the first (LED) technology to mature," said John Roberts, a City Light energy management analyst. The utility began installing green LED signals two to three years later. Most red and green lights in the city of Seattle have been converted, he added.
"They were very quickly adopted because of the energy savings. They tend to be more reliable than incandescents, which have to be replaced about every nine months," Roberts said. Long life is a critical cost management issue for traffic signals. When a signal light goes out, Roberts noted, the city does not have the option of deferring replacement.
Within the city of Seattle, red LED traffic signals save 3.1 million kilowatt-hours per year and green signals save an additional 2.4 million KWh annually, Roberts estimated.
Through its revived Power Smart efficiency program, BC Hydro plans to help British Columbia municipalities switch traffic signals to LEDs at all 3,600 controlled intersections in the province. The conversion will save an estimated 6.8 aMW per year, according to Bev Van Ruyven, BC Hydro vice president for Power Smart.
Thanks to building codes, utility incentives, and education, LEDs dominate the new construction market for exit signs, according to a 2003 report from the American Council for an Energy-Efficient Economy.
LED exit signs use 10 percent to 20 percent of the energy consumed by incandescent exit signs, the Alliance report said.
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| (Courtesy of Lighting Design Lab) |
Still, LEDs are far from saturating the traffic signal and exit sign markets. The Northwest Power and Conservation Council's 2003 conservation supply curve estimated that 14 aMW of savings could be acquired through converting the region's traffic signals to LEDs, at a cost of 3 cents/KWh. For exit signs, the savings potential was estimated at 52 aMW, at a cost of 2.7 cents/KWh.
Emerging Markets
Emerging LED markets include airport runway and port guidance lighting, retail display illumination, commercial signage and holiday lights, the Alliance report said.
Converting incandescent guidance lighting to LEDs at the Northwest's 26 major airports, for example, could save about 1.5 aMW per year, the report estimated. So far, though, LEDs have barely penetrated the airport market; only 13 North American airports use them, none in the Pacific Northwest.
The Alliance has no immediate plans for market transformation programs for such niche lighting markets, said evaluation coordinator Phil Degens. "The savings are small. Even thinking about it is not cost-effective," he joked.
A few tiny inroads have been made in Northwest markets, beyond traffic signals and exit signs. One example is LED decorative lights at the Oregon Zoo
Automotive lighting represents a "big new market," Ryan said. Manufacturers of "high-end" sport utility vehicles are embedding LED turn signals into side mirrors, he said.
Designers of upscale and luxury vehicles "like the flexibility" LEDs offer for trying out new styling ideas. "You can mold LEDs into the body of the car as stop lights and turn signals. Fifty percent of the high-end European cars and 80 percent of the Japanese cars have LEDs in their dashboard lights. It's typical of what's happening with products that have very high design requirements," Ryan said.
Lumileds this year introduced an Audi concept car with LED headlights. "They are real impressive," Ryan said. "There is no problem with blinding people--like you have with those blue, halogen headlights--there is less spill, and more control over the beam. That is so representative of what LED lighting will do for the rest of the world," Ryan said.
White LED Market
White LED lighting products are entering the market, but cost, technical, and psychological barriers must be overcome, Ryan said. A white LED costs about 10 times as much as an incandescent light, he added.
White LEDs are produced by a variety of techniques--placing colored LEDs close together to create an impression of white light, diffusing light from closely spaced colored LEDs or using phosphors to approximate white light, the Alliance report explained. "The production of phosphor-based true white light LEDs is limited not only by the progress of the LED technology, but also of the progress of the phosphor technology," it said.
An example of a white LED product is the Luxeon, marketed by Lumileds. Company literature says the Luxeon can produce 20 lumens per watt, about four times less efficient than a fluorescent light. The Luxeon is available in a variety of modules for designers, including rings, lines and rectangular arrays.
Which gets to one of the market barriers to using white LEDs for general lighting. "Most LEDs are sold as components. Purchasers must procure and assemble compatible components to meet their system needs. This lack of integration is typical of the early stages in the introduction of new technology, but it does present a barrier to the lighting community," the Alliance report said.
One exception is a new GELCore accent lighting product, a strip that can be mounted beneath cabinets with screws or adhesives.
So why would a lighting specifier ask for white LED lighting that isn't as efficient as a fluorescent and for which some assembly may be required?
Said Hearn: "Unlike traditional light sources that produce light in 360 degrees (like incandescent), LEDs are directional light sources that place the light exactly where it's needed, improving efficiency and reducing wasted light. LEDs are also very small, compact devices compared to existing light sources. This functionality will allow lighting designers the ability to create new shapes and sizes of lighting fixtures that provide the best mix of form and function."
Potential Applications
Ryan looked out a few years at the potential for new design applications, in which lighting is more than just a passive source of illumination.
"Say you get the efficiency of white LED up to 100 lumens per watt in five years. What have you got that's different from your [compact fluorescent light] today? Why would you change? You could build a light that can be programmed to provide a variety of color temperatures. In the morning, if you want your space to be like a sunrise, you could preprogram it do that. As the day goes on, you can change the color temperature. That's compelling. This is going to be different lighting, lighting that plays a role that is beyond just illumination," he said.
But before going to market, Ryan said manufacturers must take time to understand how humans will react to unfamiliar lighting technologies. "There is an adaptive process people will have to go through," he said. For example, how will people react to unusual shapes, such as flat lighting fixtures? "I told management here that I want a lab where I can get people in here and see how they react to the light. They thought I was nuts. But you can't go to market without doing that," Ryan said.
For example, several years ago Philips marketed a medical lamp to treat juvenile jaundice, a common affliction in newborns. The lamp was a blue light with a narrow-banded phosphor that destroyed elevated levels of bilirubin, which is produced when the liver breaks down blood cells and gives infants' skin and eyes a yellowish tinge. "It worked great, except it made all the nurses nauseated," Ryan recalled.
Another technology that will offer lighting designers flexibility is organic LEDs, which are built on flexible base materials, such as plastics or metal foil, instead of crystalline materials.
Organic LEDs are on the market as displays in digital cameras, cellular phones, and car audio equipment, according to an article in the February edition of Scientific American. Larger displays that can be bent, rolled, spread on tabletops, hung on walls or even incorporated into clothing are still years away from market, the magazine reported.
Ryan said the flexibility of organic LEDs will enable designers to put "task lighting where you want it. For interior design, it has endless possibilities."
But first, a few technical bugs need to be addressed. Ryan said the plastic base material in organic LEDs is susceptible to water infiltration that can damage the product. "No one wants to buy a light that will decay and start looking like it has leprosy," he said.--Jim DiPeso
Everyone supports energy efficiency--at least rhetorically.
But when it comes to supporting efficiency with funding, other resources or government policies, the demand side often gets short-circuited.
A disconcerting example just occurred in Washington's 2004 state legislative session, with the last-minute omission of energy efficiency from proposed resource portfolio standards for utilities. An ensuing renewables-only voluntary target, with tax incentives, failed to survive the Olympia gauntlet.
Legislative consideration of this issue is a long, complex and continuing saga; see our January and February Con.WEB issues for detailed coverage.
Suffice to say here that, in crunch time, key legislators and many stakeholders coalesced around the idea that renewables deserve statewide acquisition rules--but not efficiency.
This was politically defensible, for a controversial topic before a closely divided Legislature in an election year.
However, abandoning the demand side in what would likely be the most significant state law for green energy would represent bad policy, in this writer's opinion. It would signal that saving energy matters less than producing it renewably, when both should be vital pieces of Washington's electricity future.
Portfolio Standards
Energy portfolio standards moved further in the Washington legislative process than ever before, gaining approval by the House Technology, Telecommunications and Energy Committee and the Appropriations Committee, but expiring before getting a full House vote.
The TTE-passed version of House Bill 2333 would have established minimum utility requirements for both renewables and efficiency: for renewables, 5 percent of retail load by 2010, 10 percent by 2015 and 15 percent by 2023; for efficiency, utilities would have had to meet 0.75 percent of annual retail load with conservation program savings by 2006, continuing annually through 2009 and growing to 0.85 percent from 2010 through 2012.
Although a number of exemptions were offered, such as for small and slow-growing utilities, state-mandated benchmarks did not sit well with some influential players, including the Washington PUD Association, a few other utilities, and some business and customer groups. Local control over resource decisions is a longstanding high priority for PUDs. Potentially higher costs (and potentially higher rates) also fueled some of the concerns over required efficiency/renewables acquisitions.
Supporters of portfolio standards focused their arguments on themes of economic development, rate stability compared to natural gas volatility, energy independence and environmental protection.
Efficiency-less Alternative
As the Feb. 17 House approval deadline neared for HB 2333, Rep. Jeff Morris offered an alternative proposal that would have eliminated requirements and instead set a statewide goal of 15 percent renewables to serve retail utility loads by 2023. Integrated resource planning requirements were added for larger utilities, even though investor-owned utilities already are obligated by state regulatory rules to prepare IRPs. Tax credits and deductions were dangled as incentives.
This package resembled a bunny buffet in a clear-cut--lots of carrots, not many sticks.
And, most disturbingly, the Morris proposal left out energy efficiency, except for its place in integrated resource planning.
No efficiency standards, no efficiency goals, no mention of efficiency as a legislative intent or a state objective.
Stakeholders told me efficiency was excluded to simplify the bill, to help its chance of passage through the barely-Democrat-controlled House and the slim-Republican-majority Senate. That's a legitimate political gambit. It's also true that 13 other states have enacted renewables-only portfolio standards, as of January.
Meanwhile, I certainly respect the differing opinions on efficiency/renewables standards, on all sides. This is an important public policy issue, and it deserves a vigorous debate. Even with their divergent views, stakeholders nearly reached consensus on the Morris plan before the buzzer. That indicates it has a future.
An Efficiency Future
But that future, in my opinion, needs to include an efficiency component.
Why? Energy efficiency has been and remains cost-effective, job-creating, economy-boosting, energy bill-reducing, environment-enhancing, reliability-bolstering and power supply-stretching, among other benefits.
Cost-effective conservation was codified in the 1980 Pacific Northwest Electric Power Planning and Conservation Act as the NUMBER ONE priority resource for regional planning.
And for evidence of conservation's resource value, check out these facts, as reported in November by conservation resources manager Tom Eckman of the Northwest Power and Conservation Council. Regional energy savings since 1980 total more than 2,600 average megawatts, from Bonneville Power Administration/utility programs, state energy codes and federal efficiency standards; conservation is responsible for about 10 percent of regional power needs; and conservation ranks as the fourth largest regional electricity source, behind hydropower, coal and natural gas.
Good stuff--yet there's much more to accomplish. The Council sees nearly 3,500 aMW of cost-effective energy efficiency potential regionwide by 2025--that's roughly equal to 10 or more natural gas plants.
This paean to efficiency is no slight against renewables. I very much support appropriate renewables in large and small applications, and see them as a vital and growing element of the energy future for our state, region, nation and indeed world.
I also believe that, with or without state intervention, renewables and efficiency will continue growing in Washington, as wise energy choices with many compelling advantages in many circumstances.
But if Washington state government deems fit to hasten this process with some kind of benchmark, it needs to address both the supply and demand sides.
One final thought: As Washingtonians ponder how to advance green energy, they ought to look south across the Columbia River.
Oregon has dedicated public-purposes funding for renewables and conservation, plus widely respected and successful programs for commercial and residential energy tax credits.
Although Washington has different energy/political realities and tax structures, these Oregonian approaches are examples of progressive ideas to support renewables and conservation. Washingtonians can (and should) think and act progressively, as well.--Mark Ohrenschall
This month's News Bytes section features a potpourri of items regarding energy codes, renewable energy and green power, utilities and lots of awards.
Energy Codes
Renewable Energy/Green Power
In renewable energy sales from green pricing programs, Portland General Electric ranked second in the country, at 21.5 average megawatts annually as of December 2003. PacifiCorp is fourth (15.1 aMW) and Puget Sound Energy is 10th (3.1 aMW). PGE is listed third in total customer participants (26,893) and PacifiCorp is fifth (23,351). For customer participation rate, Washington's Orcas Power & Light ranks tied for fifth nationwide (4.9 percent) and Oregon's Central Electric Cooperative is ninth (4.1 percent). And in price premiums charged for new customer-driven renewables, Washington's Clallam County PUD is listed third (0.7 cents kilowatt-hour), while Oregon's Emerald PUD is eighth (1.2 cents/KWh) and Eugene Water & Electric Board is tied for 10th (1.3 cents/KWh).
Utilities
Green Building
Federal
Awards
Miscellaneous
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