Coal, Gas

Repowering Can Wait

Issue 1 and Volume 112.

Few incentives exist to repower aging wind farms.

By David Wagman, Managing Editor

California’s landscape at times offers what should be a wind power advocate’s dream. Row on row of orderly and densely packed turbines spin in the winds that blow through mountain passes. Some of the turbines have operated since the early 1980s when California was the country’s premier wind power host.

Repowering the nation’s oldest wind farms makes sense, at least until the economic and engneering challenges are fully weighed.
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But to some, California’s older wind farms deserve about as much reverence as a 1980s-vintage Yugo automobile: they’re inefficient and underpowered, to say nothing of their looks. Set atop lattice-work towers, the aging machines sometimes offer unintended final roosting places for birds.

“We would never build a project like that again,” said Mark L. Ahlstrom, CEO of WindLogics Inc., a St. Paul, Minn.-based company that helps analyze potential wind development sites. For one thing, siting wind turbines one behind the other depletes energy for the next turbine downwind, reducing the facility’s overall efficiency. For another, many of the turbines are too close to the ground by modern standards. The wind’s strength is considerably different and more consistent 80 meters off the ground, as opposed to 30 meters. Then, too, modern wind turbines spin more slowly and stand on towers that offer few opportunities for birds to land; factors which help soothe the politically sensitive avian mortality issue.

Little doubt exists that wind resources could be exploited more fully if wind turbines installed 25 years ago were replaced with 1.5 MW to 2 MW machines, spaced farther apart and built higher off the ground. But few incentives exist to repower older projects. Most operate under long-term power contracts that have yet to expire. And that points to something of a paradox: because the wind spins a turbine for free, wind farms are virtual cash machines once they are up and running. Repowering a site may more thoroughly tap the available wind resource, but it also requires a major upfront capital investment. So even though older projects stand amidst some high-quality wind, the resource’s full potential at some older projects may remain untapped for some time to come.

Death Watch

“From a public policy perspective, the best thing to do is wait for these machines to die,” said Rick O’Connell, a Walnut Creek, Calif., renewable energy consultant with Black and Veatch. For some machines that day of reckoning is already at hand. He said it’s possible to watch some older wind turbines literally fly apart on a windy day. “They will get to the point where the owner can’t make the project go, then they will start the repowering process,” he said.

Around 11,000 GW of wind capacity is currently installed nationwide. That represents about 0.3 percent of the nation’s wind generation potential, said John Dunlop, PE, technical services senior engineer with the American Wind Energy Association. A 1991 study done by the U.S. Department of Energy, which Dunlop said remains the “most comprehensive” study completed to date, reported that fully exploited wind energy could supply more than four times the country’s energy demand. “We’re only just barely scratching the surface,” he said.

It seems that with so many greenfield opportunities to exploit, few incentives exist to repower existing sites; even those with particularly good quality wind resources. That’s because repowering a wind power site can be almost as complex a process as building one from scratch. The turbines, tower foundations and underground collection systems all likely will need to be replaced, said Ryan Jacobson, Denver-based manager of wind energy projects for Black and Veatch. Even existing access roads may be inadequate to accommodate the larger machines being installed today.

Another important factor is whether or not sufficient transmission capacity exists for a repowered project. Boosting a wind farm’s capacity from 30 MW to 300 MW may be a moot point if an equal amount of transmission capacity is unavailable.

Repowering depends on incentives almost as much as greenfield development does. According to the California Wind Energy Association (CWEA), 245 MW were repowered prior to 1999, when a change in federal law took effect. That change denied production tax credits to repowered wind facilities under existing contracts unless project owners obtained from the purchasing utility a contract stating that the additional power from a repowered project would be priced at short-run avoided cost. The provision, known as the “California Fix,” slowed repowering for several years, in part because short-run avoided cost proved unattractive. As a result, between 1999 and 2003 repowering dropped to 23 MW, according to the CWEA.

But a 2003 change to California’s renewable portfolio standard offered utilities a new incentive to consider repowering. An initial 78 MW was repowered. Then in January 2007, Southern California Edison sought regulatory approval for four contracts with Caithness Corp. to allow 32 MW to 69 MW of repowered or expanded capacity in the Tehachapi-Mohave area. And last spring, PG&E sought regulatory approval to restructure six contracts with FPL Energy representing 287 MW in the Altamont Pass. Those restructured contracts were seen as likely to open the door for project repowering.

As a result, the CWEA estimated that some 340 MW—roughly 20 percent of the 1,600 MW operating in the 1990s—had been repowered as of March 2007.

More data and analysis will soon be released. According to a draft study being prepared by the Lawrence Berkeley National Laboratory for the California Energy Commission, about 1,320 MW of wind power was installed in California during the 1980s. Those aging turbines are inefficient compared to current technology. Repowering these turbines could result in a “moderate amount” of additional renewable energy delivered to the grid.

“Despite interest by the California Energy Commission and California Public Utilities Commission in encouraging this repowering, and efforts by the State’s investor owned utilities to contract with such projects, repowering activity has been somewhat slow,” a draft of the report said. “For a variety of reasons, aging wind turbines are simply not being replaced with state-of-the-art wind technology at a rapid pace.”

The report is intended to address a primary barrier to wind repowering: namely, the general lack of economic incentive to repower all but the most poorly functioning of the wind turbine fleet. In particular, it provides a “scoping-level” analysis to determine whether repowering wind facilities is, in general, economically attractive to wind project owners in California and assesses the conditions necessary to make turbine replacement economically desirable for wind project owners.

“Helpful” but No Gold Rush

In a March 19, 2007 memo to the California Energy Commission, SCE said that if all the identified capacity were to be repowered and resulted in a 25 percent to 35 percent increase in capacity, the result would be about 1,100 GWhr a year in increased wind generation. The company called such an increase “helpful” but said it would represent “less than two thirds of one annual procurement target for the three largest utilities for a single year.” The company said this additional amount of renewable energy “simply isn’t that large”, especially considering transmission constraints.

Repowering existing wind farms offers no “gold mine” according to a 2007 utility memo.
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The amount of energy available by repowering existing wind sites “does not represent a ‘gold mine’” that will help the state meet its renewable goals, the report said. “It is helpful, but not so significant that it warrants special attention.”

Pacific Gas and Electric said it had entered into agreements to repower 278 MW of 580 MW of “legacy” qualifying facility projects. The 38 MW Buena Vista energy project was repowered in 2006. The 18 MW Diablo Winds project was repowered in 2004. In addition, the company last year asked for regulatory approval to restructure another 222 MW of legacy power purchase agreements with FPL Group.

“Repowering is essentially a ‘brown field’ development,” PG&E said. “Projects involve new technology turbines operating with vastly different size and performance characteristics. Overhead electric lines are removed and converted to underground facilities. Interconnection equipment, metering and related agreements are upgraded to current standards.

“It’s huge; it’s dramatic,” said WindLogics’ Mark Ahlstrom of the scope of work involved in repowering projects. Siting decisions can be made more precise than was possible 20 years ago and can be based on much more accurate models depicting wind resources. A combination of pre-construction meteorological data and computer modeling helps to develop a 3-D picture of the wind resource where a particular turbine will operate.

“The number one thing is to understand the wind resource,” Ahlstrom said. Because energy from a wind turbine varies with the cube of the wind speed, errors that come about in measuring wind speed during the siting stages can result in extreme errors in predicting a project’s potential electricity production.

“We can simulate what the wind plant would have done had it been there 40 years,” he said. Based on those data, economic analyses can be performed, which help develop long-term revenue models. And perhaps help determine the economic viability of future wind farm repowering projects.