[Greenbuilding] [BULK] Wind power question

Thu Sep 13 22:40:44 EDT 2007

There are several vagaries and externalities that skew true pricing, costs,
etc. It's the nature of the electric system and markets. But some food for
thought: the mid-Atlantic's grid operator (PJM), has a rule that says if a
wind farm is generating then it must be given first access to the market
(nuclear plants enjoy the same rule b/c they can't cycle on and off). Coal
is usually the first choice for baseload, so this wind does displace some of
the worst polluter, meaning there is a tangible benefit to the grid and
airshed. Natural gas is generally a peak source--they are brought on during
higher demand--b/c these plants can be cranked easier and the NOX and SOX
markets move decision on which plants to efficiently crank. 

In the PJM, wind cost is usually at or near parity with coal and gas; but
the grid rules make it difficult for the utilities to separate green power
options to reflect lower prices. Further b/c demand for wind is nearly equal
to capacity, market prices "protect" a 1.5 - 2.5 cent premium--but that's
market supply and demand.

I don't know what rules other grid operators have to this regard.

Jason Holstine
Amicus Green Building Center
www.amicusgreen.com

-----Original Message-----
From: greenbuilding-bounces at listserv.repp.org
[mailto:greenbuilding-bounces at listserv.repp.org] On Behalf Of Lawrence Lile
Sent: Thursday, September 13, 2007 1:18 PM
To: requiredemail1; greenbuilding at listserv.repp.org
Subject: Re: [Greenbuilding] [BULK] Wind power question

Well, my utility has a similar programs, through them I can purchase
"renewable energy credits", which basically mean that the KWH I buy from
them are matched by wind power KWH's that go onto the grid.  

Of course there is no way to guarantee that the electrons you use come from
any power plant in particular. 

Yes, what we are accomplishing is several things:

1.  We encourage the dramatic growth in wind power with dollars instead of
just rah-rah. 

2. We tell the market that we are willing to pay extra for renewable energy

3. We can put our thumbs in our suspenders and say that our home is
producing much less carbon

4. We can help keep the planet from overheating. 

Now, your utility is, IMHO, gouging you.  The guys I buy power from charge
about 8c/KWH for conventional power on the low end of the block rate, and
1.5c/KWH more for 100% renewable power.  They are just starting up the
program, and I am slated to be on 100% renewable power October 1st.  Much
easier than hauling up all those solar cells to the roof, I'd say. 

You can circumvent the power company and purchase renewable energy credits
directly, if you want.  This works much like your utility's program, in that
you offset the KWH you use by buying wind power that nobody else is getting.
The wind power goes onto the grid, and then goes who-knows-where, but you
were the one that paid the wind company to put it there.  

One outfit I know something about, because my local utility uses their
program, is Green-E, which certifies other REC programs as being on the
up-and-up

http://www.green-e.org/

follow their links to find Green-E certified providers for individuals.

Lawrence Lile, PE, LEED AP
Project Solutions Engineering

-----Original Message-----
From: greenbuilding-bounces at listserv.repp.org
[mailto:greenbuilding-bounces at listserv.repp.org] On Behalf Of
requiredemail1
Sent: Thursday, September 13, 2007 11:13 AM
To: greenbuilding at listserv.repp.org
Subject: [BULK] [Greenbuilding] Wind power question
Importance: Low

This question might be slightly off topic for this list, but I'm pretty sure
that there are some like minded individuals out there who have thought about
this question.  

I just learned that I can buy "100% wind power" from one of the local
competitve energy suppliers for my residential energy usage.  The price is
13.86 cents per kWh for an 11-month term.  This cost is for energy
generation and transmission only.  The distribution costs from my local
electric company are extra.  This 13.85-cent price is about 45-50% more than
than per-kWh cost for generation and transmission that I currently pay
through my local electric company.  The total cost difference for me based
on about 4000-4200 khW annually is about $250-300.

I would switch providers and pay the extra cost if I thought that my choice
would affect, even in a miniscule, statistically-insignifcant way, the
amount of fossil fuel burned for power generation in the US.  Or put another
way, I would switch if I thought that my choice, along with 999,999 other
residential customers making the same choice, would make a difference.  

The competitive energy supplier says in their marketing materials that "Wind
energy is guaranteed to be placed on the grid in an amount equal to your
purchase size, thereby matching your power consumption with clean, renewable
wind energy generation."  

I understand that energy generated from all different sources in put into
the power grid "pool," and that when I purchase 100% wind energy, I'm just
ensuring that the amount of my purchase is placed into the "pool."  But I
guess my concern is that all I'm really doing is paying 50% more for energy
that's already in the pool.  I mean, the wind turbines that are supplying
the pool have already been built, probably based on projections about demand
for wind power from residential customers, but they're up an running
regardless of what me and my 999,999 friends actually do.  

Furthermore, I could be wrong about this point, but one would assume that
those existing turbines are currently supplying 100% of their capacity to
the pool because the majority of the costs to operate the turbine are fixed
costs (the cost of the wind-farm land and the turbines).  Thus, I would
assume that the turbine operator would run the turbines at full capacity
whether he's getting 4 cents or 7 cents per wholesale kWh.  Naturally, the
operator might not be able to turn a profit at 4 cents and, therefore, might
not operate indefinitely or might not invest in additional turbines in the
future.  

So maybe the best that I could say is that by paying 50% more for "100% wind
power," I'm making it more profitable to operate wind turbines, which might
mean that operators would invest in bringing online more wind turbines in
the future than they otherwise would.  In this way, my choice wouldn't
affect the balance of energy sources used today but might affect the balance
of sources used in the future.  

On the other hand, maybe I, and other residential energy customers, should
use our $250-300 per year in a way that has more direct effects on fossil
fuel emissions.  

Thoughts?   

Thanks.

Art. 

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