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The Coal-Wind Connection

Issue 1 and Volume 111.

Electrons from coal plants and wind farms will ride together on new transmission lines they both desperately need

By Steve Blankinship, Associate Editor

Suppose that as we expand our interstate highway system we decide to reserve entire lanes for the exclusive use of hybrid vehicles. The motive would be to encourage more efficient energy use and reduce pollution. There’s little doubt that some would applaud such a policy. But for a number of practical reasons, the idea would likely fail.

Now let’s apply the same idea to new electric transmission lines to handle new renewable and coal capacity. There is now more than 10,000 MW of wind capacity in the United States and 3,000 MW of additional wind is being added each year. That trend will likely continue. But most wind capacity lies hundreds of miles from load centers, meaning the wind industry faces constraints due to a lack of transmission capacity. The issue is further complicated because wind generation is intermittent. Older wind turbines located in less optimal sites operate at capacity factors as low as 20 percent. The newest turbines in more optimal locations can achieve 40 percent capacity factors.

Widespread agreement exists that new transmission capacity will be needed as more wind capacity is built. Transmission constraints are most critical in the Northwest and upper Midwest, where abundant wind resources span sparsely populated regions. Additional transmission is needed to deliver wind generation to population centers located primarily to the west and east, but also to the south and even to the north.

The Northwest and upper Midwest also hold major deposits of coal. Much of it is sent to coal plants located elsewhere; exports from these regions will likely grow as new coal-fired capacity is built. And while many wind proponents believe transmission should be built to accommodate wind exclusively, the reality is that transmission likely will be built and shared by new wind and new coal-fired capacity.

Epicenter

Wyoming may well be at the epicenter of the issue. The state historically has been a net power exporter, with about two-thirds of its generation sent to other states. In 2004 Wyoming’s legislature created the Wyoming Infrastructure Authority to diversify and grow the economy by developing electric transmission infrastructure. Steve Waddington, the authority’s executive director, says Wyoming like other states in the Rocky Mountains and Midwest has both low-cost coal and high-quality wind resources. “We want to see those resources play a role in meeting electricity needs around the west,” he says. “But there’s no transmission to make that happen.”

The state created the authority because utilities haven’t been building enough transmission. The authority formed a public/private partnership with Trans-Elect to develop the TOT3 transmission project between Colorado and Wyoming. Power developers have expressed interest representing up to 7,300 MW of new capacity, but Waddington believes TOT3 will eventually add about 1,000 MW of new coal and wind generation transmission capacity. Allocating capacity rights on the new line will be conducted through an open season this year.

The state also has a partnership with National Grid to develop power in southwest Wyoming focused on the Salt Lake City market in adjacent Utah. There’s also TransWest Express, a proposal to develop a DC line from Wyoming to Phoenix. In addition to regional utilities, a number of coal companies have shown interest in developing power plants. And dozens of land owners and entrepreneurs want to develop wind farms in Wyoming.


The 150 MW Elk River Wind Power Project in Kansas supplies power to the Empire District Electric Co. under a 20-year contract. Photo courtesy PPM.
Click here to enlarge image

“The more practical minded wind developers recognize that transmission is going to be needed if they’re going to be successful long term,” says Waddington. He said the opportunities for cherry picking good quality wind sites with access to transmission are diminishing. “Higher quality wind sites are in places that will require substantial transmission,” he said. Overall, Waddington believes even optimal wind capacity factors of around 40 percent will not be sufficient to finance major lines except in limited cases. He refers, for example, to a tie-line being developed between Alberta and Montana that is being financed exclusively as a wind development.

He adds that the first phase of TOT3 might have about 150 miles of 345 kV line built exclusively for wind development because capacity factors could be high enough. “I think there will be examples like that where transmission and wind can be put together on a green line,” Waddington said. “But for anything that’s long distance, there will have to be some thermal generation as an anchor.”

Transmission Trauma

Total transmission miles are projected to increase by less than 7 percent in the U.S. through 2015. Uncertainties caused by inconsistent, patchquilt deregulation have dampened incentives to build new transmission. Those who pushed deregulation expected regional transmission authorities and independent system operators to address issues related to central infrastructure planning and cost recovery. Such organizations have emerged in several regions, including the Midwest Independent System Operator (MISO), the PJM serving 14 states in the mid-Atlantic and surrounding regions and the California Independent System Operator (CAISO). Texas, with more installed wind capacity than any other state, has long enjoyed central planning advantages inherent to having its own grid – the Electric Reliability Council of Texas (ERCOT).

But except for CAISO, no regional transmission organizations exist in the Western Electricity Coordinating Council (WECC) region. And it’s not likely those institutions will be created anytime soon, says Waddington, meaning no overarching organizer exists for transmission planning or market management as in other parts of the country.

Centralized planning that balances capacity with demand appears critical to developing transmission for wind. Bill Bojorquez, director of system planning for ERCOT, says tailoring transmission to wind and other renewables is easier in Texas because of single jurisdiction by one legislature and one utility commission within an independent grid.

Bojorquez, a former senior planner with Southern California Edison who also worked for CAISO, knows that a regional authority should assure that power is available when needed under all circumstances, and not depend on outside sources in emergencies. ERCOT’s status as a stand-alone grid has allowed planning that assures reliability while accommodating the country’s largest wind fleet, currently about 2,500 MW and expected to grow to 10,000 MW by 2025.

A CREZ-y Idea

One Texas innovation designed to further integrate wind with baseload fossil power resources is the creation of competitive renewable energy zones (CREZs). Under CREZ, zones will be identified having at least 1,000 MW of renewables. New transmission corridors will be set up linking the renewable energy zones to power markets in ERCOT. The zones will be determined based on optimal diversity, fuel savings, reliability and emission reductions.

Likely CREZs will be in wind-prone west Texas and between Corpus Christi and Galveston, where new wind capacity is proposed both inland and offshore. Additional transmission and enhancements would be needed to bring the wind power into densely populated load centers in central, north and east Texas. “The law does not discriminate on who can connect to the lines,” says Bojorquez. “There may be a push from stakeholders to exclude other technologies, but our market is not compatible with that.”

The Texas approach seems to appeal to the wind industry. Texas Governor Rick Perry has received a $10 billion investment guarantee from wind energy developers in exchange for the state’s assurance that necessary power transmission lines will be built.

Furthermore, Texas has specified wind energy goals in hard numbers, not percentages. “With a percentage, things can sometime get a little blurry,” says Bojorquez. “Is it hydro or biofuels or what? Transmission is a lumpy addition. It doesn’t come in percentages. It comes as total capability.”


Two of the 100 1.5 MW wind turbines that make up the Elk River Wind Power Project in Kansas. Photo courtesy PPM.
Click here to enlarge image

Bojorquez believes that regardless of how other parts of the U.S. grid are regulated, a planning authority with significant power must exist to conduct open regional planning with a mandate to do it.

Mike Jacobs, deputy policy director for the American Wind Energy Association (AWEA), notes that overlapping regulation hamstrings many regions that need to build transmission to accommodate wind. He sees no reason why CREZ can’t work elsewhere. Texas met its goal of adding 2,000 MW and “when they came back a second time they heard and understood they needed to build transmission” to meet renewable energy goals, he said. “They saw that transmission has to be a part of the law if the goals of the law are to be achieved.”

Exclusivity is Moot

Jacobs prefers not to consider who will use a transmission line so long as it’s built with wind in mind. A wind industry goal for the past 20 years has been to upgrade transmission from the Dakotas to Chicago. AWEA is promoting such a line as a “national interest” electricity corridor. That means each power plant along the line will build its own tie to the main line and the line will carry electrons from all sources, even if proponents say it was built because of wind. “You can’t stop other power from flowing on it,” he said.

Jacobs adds that having adequate capacity and spinning reserve is a question for utilities to address. “That’s a factor when you decide to build your next coal or nuclear plant. It is not an issue specific to wind.”

Furthermore, he believes wind’s lower capacity relative to coal or nuclear is a non-issue. He points to a transmission line serving New York City with an average capacity factor of 62 percent. He argues a 40 percent capacity wind farm is realistic in that context. “Integrating something that is variable has not proven to be a problem we can’t solve,” Jacobs said. “Utilities all over the world have found wind to be worthwhile. Ask the Europeans and they would say they built wind before they thought much about it.”

Another way to boost capacity, he says, is to consider building 20 percent more wind turbines than the farm’s nominal output. So if a wind farm nameplate is 120 MW, only 100 MW from that source is allowed on the transmission line. “Wind doesn’t need any fuel so if we have more generating units, we put more energy onto the line from those additional wind turbines.”

Timing and Synchronization

A complication to co-developing coal and wind capacity with common transmission is that it takes about three times longer to build transmission and coal-fired generation than it does to build a wind farm. Waddington acknowledges that the timeline for a coal plant and a transmission line are much more compatible than the timeline for wind.

And while Jacobs hears talk about co-developing wind with coal, he notes that because it takes two years to build a wind project, a problem exists getting it lined up with the transmission line’s construction schedule. He believes that trying to coordinate coal and wind projects would only slow the benefits.

Then too, what has turned into the two-year on/off nature of production tax credit extensions poses another problem with timing.

“If you’re trying to build a wind farm and capture the production tax credits, you can’t let other issues drive your schedule,” he says. “More importantly, if you’re going to get benefits from the wind and it’s going to reduce your fuel costs, you can do that today and the justification of a coal plant as part of that is not related to wind. It’s related to your ambitions to build a coal plant.”

Although he has not seen any coherent plan on how to co-develop coal and wind generation with a common development of transmission, he has seen coal proposals that incorporate wind in the hopes of winning beauty points. For example, developers may announce 300 MW of wind and two or three coal plants. “They’re not going to link them geographically, just politically,” Jacobs said. “And we’re not buying that. That’s really abusing the benefits of wind.”

Jacobs says the wind industry is not trying to sell baseload power plants. “If someone wants to build a coal plant, we don’t have a particular fight with that. But if they say they can’t build any wind because they’re too busy building coal plants, or they can’t build wind until after they build coal, I’m not sure they’re on the same page as we are.”

There’s also the issue of how well coal generation can compliment wind and vice versa. “From an electrical engineering perspective, bringing coal plants next to wind projects has some good synergies,” says Bojorquez. “One of the biggest problems we’ll face is electrical stability because wind turbines might not be able to provide adequate volt amp reactive (VAR) support.” Wind technologies have solved the problem of providing steady state VAR flows and the ability to convert from DC to AC with capacitor banks that allow them to operate like a synchronous plant. “But that does not give us a good sense for dynamic support,” he said.

Large coal plants provide instant VAR support inertia that wind plants don’t. “So in combination it gives a better sense that you could build a long distance line to export power because there’s not a lot of load in west Texas,” he says. A coal plant could be an anchor allowing for the fluctuations of wind and offering grid stability support that wind alone cannot provide.

Pulverized coal plants, however, are not known for their cycling ability. If backed down to accommodate wind capacity, heat rates could suffer and environmental control equipment might not function optimally. Combustion turbine plants might prove a better compliment with their ability to cycle. That suggests the possibility of gasifying coal to produce syngas fed to combustion turbines.

If coal gasification technology emerges on a commercial scale, there would be a good opportunity for integrated gasification combined cycle (IGCC), which can cycle to firm up variable wind generation, says Waddington. He estimates that idea remains several years in the future because IGCC technology isn’t fully commercially available. “There’s some thinking that a gasification plant might some day firm up wind in a cost effective way,” he says, noting that Wyoming has seen interest from companies willing to launch an IGCC demonstration plant.

Several coal companies operating in Wyoming are considering the possibility of gasifying coal and putting it into the pipeline. That may help solve the problem posed by California’s decision to bar utilities from entering into long-term power contracts with sources that do not meet California’s greenhouse gas emission standards.

California Rules

Rob Hurless, energy advisor to Wyoming Governor Dave Freudenthal, said the California law does not threaten Wyoming’s plans to export more power, noting that lots of markets lie between Wyoming and California. Furthermore, he says, Wyoming would be happy to sell California natural gas. A natural gas pipeline already connects Wyoming and California, moving 1.7 billion cubic feet of natural gas daily into the state. Hurless says California is effectively locking itself into a gas-fired generation economy going forward.

“It has been understood for some time that California is moving toward a regulatory and now statutory scheme that will limit long-term power contracts to sources of generation that meet greenhouse gas emission guidelines,” says Waddington. “Our understanding is that coal-fired generation using gasification technology and carbon dioxide sequestration will meet these guidelines and be an acceptable source of power for California.”

He says Wyoming’s transmission efforts would allow its abundant, low-cost coal and wind resources to be developed and provide electricity to other rapidly growing areas in the west, such as Arizona, Utah and Colorado, where regulatory or statutory greenhouse gas emissions standards don’t exist.

Transmission additions are needed for a variety of reasons, Waddington, said, the largest of which may be what is becoming an over reliance in the west on natural gas-fired generation.

“Utilities are increasingly looking to states like Wyoming as a way to diversity their power supplies and get to some low-cost coal and high-quality wind,” Waddington said. “We need transmission to make that happen.”