Nuclear, Reactors, Retrofits & Upgrades

Was Curtailment Necessary?

Issue 9 and Volume 115.

  By Michael Goggin, Manager, Transmission Policy, American Wind Energy Association

In mid-May, the Bonneville Power Administration (BPA) implemented a policy that allowed it to curtail wind plants’ output at will, breaking the contracts that BPA had signed with those generators. Over the next month, BPA curtailed over 75,000 MWh of wind output. BPA claimed it had no other options to deal with the abnormally high output from its hydroelectric dams, driven by an unusually large La Niña spring water runoff.

However, a closer look at BPA’s own data undermines its claim that it had no other options, as it reveals there was more than enough spare capacity on BPA’s transmission ties to neighboring power systems to transport all of the curtailed wind energy to customers who could have used that zero-emissions energy.

During the hours that BPA curtailed wind between mid-May and mid-June 2011, there was an average spare capacity of over 3,350 MW on BPA’s interties with California and British Columbia. These ties were only 65 percent utilized on average during these hours, with 35 percent of the capacity available during the hours when wind was being curtailed. Wind curtailment averaged 600 MW in the hours it was curtailed, meaning the 3,350 MW of average spare transmission capacity exceeded the amount of wind curtailed by more than a factor of five.

As the chart indicates, the available tie capacity significantly exceeded the amount of wind that was being curtailed in all hours. At the lowest point, BPA could have exported all curtailed wind and still had at least 1,275 MW of spare capacity left on the interties.

BPA has insisted that it could not find off-system buyers to take the wind power that it was curtailing. However, the data also belies that claim. Data from the California Independent System Operator shows that power prices at a major import point in northern California were positive during the majority of hours when wind was being curtailed by BPA, indicating that this wind-generated electricity could have been sold at a profit.

During the hours when wind was being curtailed by BPA, locational marginal prices (LMPs) were as high as $9.50/MWh at the Round Mountain substation in Northern California. Multiplying the curtailed wind megawatt-hours in hours during which LMPs in Northern California were positive by the LMPs in those hours yields $111,000. This is value that theoretically could have been realized if BPA had sold the curtailed wind energy (though the actual amount would have been slightly less, since adding supply would drive the price down).

In short, it appears that BPA could have made a contractual arrangement to offload the wind power it curtailed at a price that was still above zero, and it probably could have sold all or nearly all of that energy if it allowed the price to go as low as -$13/MWh. Why BPA didn’t do so is still an open question.

While the wind curtailments appear to have largely subsided for this year, significant harm has already been done to wind generators. Wind generators have unexpectedly suffered millions of dollars in lost output and BPA’s decision that it can unilaterally break contracts with wind generators is likely to have a chilling effect on future wind development in the region.

There are longer-term solutions that will also help to alleviate situations when BPA has abnormally high hydroelectric or wind output, like building additional transmission and implementing grid operating reforms that move towards more coordinated power systems operations across the Western U.S., as would occur under the efficient dispatch toolkit being evaluated by WECC, the Western Electricity Coordinating Council. However, the data presented here indicates that solutions also exist that BPA could implement immediately, such as more fully utilizing its interties with neighboring regions.

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