Wind Energy Weekly Vol 15, #703, 24 June 1996
The following is the electronic edition of WIND ENERGY WEEKLY,
Vol. 15, #703, 24 June 1996, published by the American Wind
Energy Association. The full text of the WEEKLY is available
in hardcopy form for $595/year and is recommended for those with
a serious commercial interest in wind (the electronic edition
contains only excerpts). A monthly hardcopy publication, the
WINDLETTER, more suitable for those interested in residential
wind systems is included with a $50/year individual membership in
the Association. AWEA's goal is to promote wind energy as a
clean and environmentally superior source of electricity. Anyone
sharing this goal is invited to become a member--please help!.
For more information on the Association, contact AWEA, 122 C
Street, NW, 4th Floor, Washington, DC 20001, USA, phone (202)
383-2500, fax (202) 383-2505, email firstname.lastname@example.org Or
visit our World Wide Web site at http://www.econet.org/awea.
New Hampshire woman is first to get direct access
Power exchange transmission proposal stirs dogfight
Utilities join to back federal utility deregulation
Renewables get support from public interest groups
FIRST CUSTOMER GETS POWER
IN RETAIL WHEELING PILOT
Victoria Baker, an aeronautical engineer living in Salem,
N.H., became the first person in the United States to receive
power from an energy supplier of her choice--Granite State Energy
(GSE)--June 17 in the country's only statewide pilot program
testing retail competition for the electric utility industry.
The New Hampshire pilot is the first in the nation to allow
randomly chosen residential and business customers, along with
those residing in six designated communities, to choose their
energy supplier. (In Illinois, a similar program for both
residents and businesses restricts pilot competition to five
Baker will pay 2.5 cents per kilowatt-hour for the next two
years. Billing will reflect the cost for supplying electricity
to her home (GSE's price) and the cost for delivering the
electricity (Granite State Electric's price).
"Granite State Energy learned that power flowed to Baker's
residence first, approximately five days before the other
utility currently servicing pilot participants began to send
power to their customers," noted GSE Manager Arthur Pearson, who
added that meter reader information confirmed Baker as the first
in the country to benefit from the unique pilot.
In addition, GSE announced that four companies, three
Newport municipal departments, and the town of Warren have signed
up with the power supplier.
COGENERATORS, GAS COMPANY
RAP TRANSMISSION PROPOSAL
Southern California Gas Co. (SoCal Gas), the nation's
largest natural gas distributor, and the Coalition for Comparable
Transmission (CCT) of which it is a member joined last week in
criticizing the proposals of California's major electric
utilities for a single transmission access fee for the Western
Power Exchange (WEPEX) (see WIND ENERGY WEEKLY #702, June 17,
Both SoCal Gas and the CCT filed comments with the Federal
Energy Regulatory Commission (FERC) June 14 which argued that a
two-tiered transmission fee structure that distinguishes between
local and regional transmission service would be more equitable.
Not coincidentally, a two-tiered fee would also have the effect
of making out-of-state power slightly more expensive.
CCT spokesman George Minter said in a news release that
"FERC is seeking to create a competitive market for electric
generation, which we support. But many generators in California
could be blocked out of the marketplace by a transmission pricing
scheme which favors long-distance transmission and out-of-state
power." Members of CCT besides SoCal Gas include several
cogeneration companies, among them AES Placerita, Harbor
Cogeneration, FPB Cogeneration, Watson Cogeneration, and Pacific
SoCal Gas said June 11 that an economic study of a
deregulated California electricity market indicates that electric
generation in the southern part of the state will be displaced by
power from other regions. Under one of three scenarios in the
study, the company said, it would lose approximately 5% of its
business due to the establishment of a statewide power pool, and
another 5% if a single transmission access fee is adopted. The
study also found that consumer savings from the power pool would
be only $15-30 million per year.
The study, "Simulating Electricity Restructuring in
California: Interactions With the Regional Market," was conducted
by the University of California Energy Institute, under contract
to the California Energy Commission.
The study "does not bode well for southland cities with
electric generating facilities or for Southern California Gas
Co.'s throughput to electric generating customers," SoCal Gas
said. The lost power would be replaced by out-of-area electric
imports, it said.
Lee Stewart, senior vice president of SoCal Gas, reiterated
his company's support for restructuring and retail access, but
added, "It's apparent that transmission pricing is a key factor
in the generation and dispatch of electricity, and should be
closely evaluated by [FERC]."
AWEA has previously endorsed a single transmission access
fee (sometimes referred to as "postage-stamp pricing") for
transmission within a regional power exchange. Wind energy
technology generally would benefit from such an approach, it is
thought, because wind plants are "location-sensitive" and must be
sited where wind resources exist, often at some distance from
urban load centers.
Operators of existing wind power plants in California would
conceivably also be damaged by low-cost out-of-state competition.
However, AWEA proposes to address the problem with the Renewables
Portfolio Standard (RPS), under which electricity suppliers would
be required to obtain a certain minimum percentage of their power
from renewable resources.
7 MAJOR UTILITIES CALL FOR
FEDERAL DEREGULATION NOW
Seven major investor-owned electric utilities said June 18
that they have formed the "Partnership for Customer Choice"
(PCC), which will push for federal legislation to enact full
retail access by the end of the year 2000.
Members of the coalition include Allegheny Power, Cinergy,
PacifiCorp, Pennsylvania Power & Light, UtiliCorp United,
Wisconsin Energy Corp., and Wisconsin Power & Light. The
coalition's "Statement of Common Principles" is as follows:
PUBLIC INTEREST GROUPS ISSUE
STATEMENT ON RESTRUCTURING
- "The right to choose an electric supplier must be extended
to all retail customers as expeditiously as possible. States
should be required to enact and implement their own laws and
regulations to ensure all customers have the power to choose
their electric supplier no later than the end of calendar
- "As customer choice must be guaranteed, so must customer
protections. States should retain authority to regulate
local distribution of electric energy including establishing
rates for distribution functions and ensuring reliability,
subject to a federal standard of nondiscriminatory open
access for all customers and power suppliers.
- "Transmission systems must be operated to enhance, rather
than impede, market efficiency. Recognizing the benefits of
regional coordination and larger geographic markets, the
companies support the development of independent system
operators or comparable mechanisms.
- "There are appropriate roles for federal and state
government in addressing the collection of costs that a
utility may not recover in competitive wholesale or retail
markets for electricity. Methods developed by governmental
bodies to ensure recovery of such costs must not be
implemented in a manner that unduly impedes the transition
A coalition of national and state public interest groups
called June 19 for making environmental and consumer protection
top priorities in any efforts to introduce competition in the
electric utility sector.
The coalition released POWER FOR THE PEOPLE, a blueprint
outlining what it called "a comprehensive set of policies
designed to protect consumers from higher bills, promote energy
efficiency and renewable energy programs, guarantee service for
low-income and rural customers and ensure that utilities do not
receive full recovery of costs associated with uneconomical
The document "represents a road map for moving towards a
competitive market that will benefit consumers and the
environment without bailing out utilities or abandoning strong
commitments to energy efficiency, renewable energy and low-income
consumers," said Matthew Freedman, Energy Policy Analyst for
Public Citizen's Critical Mass Energy Project.
Policies to develop cleaner energy sources are addressed in
the blueprint, which calls for all electricity sellers to support
a minimum portfolio of renewable energy resources at levels
higher than exist today. "States must make renewable energy
development a priority because of its substantial environmental
and long-term economic benefits. These benefits are likely to be
tossed aside if policymakers focus on short-term costs and ignore
the consequences of emissions from fossil and nuclear plants,"
said Wenona Hauter, Environmental Program Director for Citizen
Action. The move to competition has already frozen many utility
commitments to new renewable resource development and threatens
to result in the loss of existing solar, wind, biomass and
geothermal projects across the country.
POWER FOR THE PEOPLE also contains a number of other
strongly pro-renewables provisions, including:
Copies of POWER FOR THE PEOPLE can be obtained from Public
Citizen, phone (202) 833-3000, at a price of $20.
- A requirement that electricity from renewable energy sources
be dispatched on an "as-available" basis. Some current
plans for the operation of transmission systems would
require power plants to offer electricity for sale a day or
more in advance, which would create a serious obstacle for
intermittent resources like wind.
- A requirement that a "renewables project finance fund" be
established to make low-cost capital available for renewable
project developers: "This revolving fund could be
established through a state bond issue and would be
accessible to new renewable projects that sell at least 50%
of their electricity to consumers within the state."
Other issues covered in the blueprint include:
- A requirement that utilities legally separate their business
units and divest all generating plants. States are also
encouraged to take control of the transmission system and
operate it themselves or under the auspices of an
independent, non-profit agency.
- Creation of an independent energy agency to administer and
oversee energy efficiency, low-income, universal service and
research and development programs.
- Implementation of a system benefits charge and universal
service charge to support energy efficiency, research and
development, low-income, bill assistance and rural consumer
- A requirement that old fossil fuel plants meet the same
emissions standards applied to new plants in order to
compete in new electricity markets.