Forecast: NW Energy prices likely to rise modestly January 24, 2010

Energy prices in 2009 reflected both good and bad news for consumers; the good news was that prices for natural gas and oil were much lower than the previous year; the bad news was that a severe recession was part of the reason for the lower prices.

Looking ahead to 2010, I expect a modest recovery of energy prices, the extent of which depends to a large degree on the economy. A robust recovery from the recession would put more upward pressure on energy prices. A sluggish recovery would moderate energy price increases.

Oil prices should increase moderately during 2010. They remain high by historical standards even during the recession. The outlook for oil prices, however, must always be conditioned on developments in the Middle East. Changes in world oil prices quickly find their way to the gasoline station and consumers’ pockets.

Natural gas prices fell by about 50 percent between 2008 and 2009. Many consumers have seen the effects of this reduction in their natural gas bills as distributors pass along cost reductions in rates. I expect moderate natural gas price increases this year.

However, a new development is at work in the U.S. natural gas market that could affect future prices. A couple of years ago, natural gas supplies were expected to decline for the U.S. and Canada. Yet, improved drilling and recovery technologies have unlocked natural gas supplies from shale and other non-conventional formations. The result was a substantial increase in natural gas supplies that, combined with the recession, contributed to the collapse of prices in 2009. While there are questions remaining about the future of these non-conventional supplies, they are likely to help contain price increases for years to come. Nevertheless, the higher cost of developing these supplies will prevent large decreases in natural gas prices in the long term.

Electricity prices for consumers are less volatile than oil and natural gas prices. They are regulated to a greater extent and more insulated from market fluctuations. This is especially true in the Pacific Northwest, where hydroelectricity supplies a large share of our electricity. Hydroelectricity cost does not change directly based on fuel prices.

Future costs of electricity are increasingly likely to be affected by policies addressing climate change concerns. It is important to understand that, nationwide, electricity generation accounts for 38 percent of carbon dioxide emissions.

Because of the large presence of hydroelectricity in the Pacific Northwest, the electric generation share of carbon dioxide emissions is only 23 percent. For example, electricity generation in Washington state produces only 20 percent of the carbon dioxide emissions per kilowatt-hour of the total U.S. electricity generation.

Nevertheless, efforts to reduce carbon dioxide emissions are likely to significantly affect the cost of electricity. Electric utilities in Washington are subject to renewable portfolio standards that require growing shares of electricity supplies to be renewable. Renewable electricity generation is more expensive than existing generation and new natural gas-fired electricity generation. Proposed cap-and-trade systems for greenhouse gases would raise the cost of existing carbon dioxide-emitting generation, especially existing coal plants that account for 85 percent of the carbon dioxide emissions from the Northwest power system. Even improved efficiency of electricity use can raise electricity rates, while at the same time reducing electric bills for homes and businesses that participate because less electricity is consumed.

Conservation vs. new power

Carbon emissions and electricity costs were issues that the Northwest Power and Conservation Council addressed in its new draft Sixth Power Plan for the Pacific Northwest. The resource strategy advocated in the plan is an aggressive pursuit of improved efficiency (conservation) in homes, businesses, and factories.

The council found that much of the region’s expected growth in electricity needs could be met with conservation at far lower cost and risk than building additional generation. In addition, renewable electricity generation acquired to meet renewable portfolio standards in the region will help reduce carbon emissions. The region should improve the operational procedures of the power system to better integrate variable generation sources such as wind, but also should look for other small-scale renewable opportunities in local communities. After renewable power requirements are met, natural gas-fired generation is the next best source, if necessary. In the long-term, other forms of generation, efficiency, energy storage, or operational changes should be considered, researched, and demonstrated, including smart-grid technologies.

Such an energy strategy requires that the region’s citizens and businesses, working with their local utilities, participate in securing their own energy futures. Low-cost supplies of energy can no longer be taken for granted. But energy that is available can be used far more efficiently, reducing the impact of rising costs and resulting in a more sustainable economy.

Terry Morlan, Columbian forecaster; The Columbian – http://www.columbian.com/news/2010/jan/24/energy-prices-likely-to-rise-modestly/

Avista wants two dams certified as low-impact January 20, 2010

Avista Corp. wants to certify its two Clark Fork River dams as “low-impact” hydro projects, a designation that would allow the utility to sell renewable energy credits from the dams.

About half of Avista’s electricity comes from the Cabinet Gorge and Noxon Rapids dams, which generate up to 803 megawatts of power. To certify the dams as low-impact, the utility has to demonstrate that they meet criteria in eight areas, including water quality, river flows and fish passage.

“For many knowledgeable consumers, hydropower raises questions,” according to the Low Impact Hydropower Institute, a Maine-based nonprofit that issues the certification.

While dams don’t generate greenhouse gases, they can affect the environment by flooding habitat, degrading water quality, blocking fish movement and altering natural river flows. Through the certification process, institute officials scrutinize dams, determining if negative effects have been minimized or offset.

If Avista gets the certification, it will be able to sell renewable energy credits from the dams on the Chicago Climate Exchange, said Anna Scarlett, a utility spokeswoman. The credits are sold to consumers who want to support environmentally friendly energy production.

Comments on Avista’s application will be accepted through Feb. 9. Visit lowimpacthydro.org for more information.

Spokesman Review – http://www.spokesman.com/stories/2010/jan/20/avista-wants-two-dams-certified-as-low-impact/

“Green jobs” likely in Idaho, perhaps driven by more hydro power, state agency says November 20, 2009

Renewable energy is one place the state could make job gains, said the Idaho Department of Commerce.

In 2008, the U.S. Energy Information Agency ranked Idaho seventh nationally in its renewable energy generating capacity, and an Idaho Department of Labor analysis found energy sector employers paying $2.6 billion to over 49,000 workers, 12 percent of total wages and 7.5 percent of total jobs.

A $1.25 million federal grant awarded earlier this week to the Department of Labor will be used to develop detailed information on the current and future potential of jobs in the state’s power and energy industry, and in particular jobs in the area of efficient and renewable energy, also known as “green jobs.”

The Energy Information Agency profile of Idaho identifies its vast hydropower resources — the sixth largest in the nation — as the source of nearly all the state’s renewable energy capacity. Wind and wood or wood waste accounted for less than 7 percent combined.

But researchers at the Idaho National Laboratory have identified 6,700 additional hydropower sites that could potentially produce another 2,100 megawatts of electricity. That would boost Idaho’s hydro capacity by another 22 percent.

Wind remains the most likely alternative resource for development. In 2004, the federal energy agency found no notable wind generation in Idaho. Idaho has 146 megawatts of wind power operating in Idaho according to the Idaho Strategic Energy Alliance Wind Task Force report.

Of that total, 64.5 megawatts, is being generated by the Wolverine Farm in southeastern Idaho”s Bingham County. Recent wind mapping indicates Idaho has about 18,000 megawatts of generation potential, the 13th highest in the United States. The southeastern part of the state has been identified as having several locations with nearby transmission lines that could support viable wind farms. Most developers require a wind classification of three or higher, and of the 75 sites in Idaho at that rating a third are in the southeast.

The natural hot springs in southeastern Idaho account for the Northwest’s first geothermal electric plant near Raft River. Operated by U.S. Geothermal Inc., it produces about 13 megawatts of electricity with a maximum capacity estimated at 110 megawatts.

Generating costs are relatively high, but technological improvements offer prospects of developing one or more of the other 24 geothermal sites in Idaho identified for the Governor‚s Geothermal Task Force in 2007.

Recently the Northwestern Band of the Shoshone Nation announced plans for a 100-megawatt geothermal plant near Preston.

Biomass — wood products, cellulosic feedstock and byproducts from grain crops — is being evaluated throughout the state to include gases containing carbon from decomposing landfill material. But timber and grain are the focus.

Rocky Barker, Idaho Statesman – http://www.idahostatesman.com/business/story/981073.html

Packwood Lake Hydroelectric Facility to Get $800,000 Stimulus November 9, 2009

The Packwood Lake Hydroelectric Facility in the Gifford Pinchot National Forest will receive up to $800,000 in federal stimulus money to make upgrades and become more efficient, according to a release from the U.S. Department of Energy.

The money is part of $5.47 million in funding for upgrades to similar facilities across Washington, and is expected to spark construction at the Packwood Lake facility by August 2010.

The money will allow the facility’s owner, Energy Northwest, to purchase and install a Washington-made Pelton wheel turbine that will allow the facility to increase its generating capacity by as much as 6 percent, according to a release from U.S. Congressman Brian Baird.

The changes will increase the facility’s production capacity by 5,800 megawatt-hours each year.

Energy Northwest will be required to match each federal dollar spent on the project.

“This project will create jobs, and increase our supply of clean, renewable energy to help meet the needs of our growing population,” Baird said in a statement. “This upgrade has been in the works for some time, but because of the Recovery Act, we will be able to get the project to construction faster, which will stimulate our local economy, while improving our infrastructure for future generations at the same time.”

Nationwide, as much as $30 million is being allocated for hydropower upgrades by the Department of Energy and the American Recovery and Reinvestment Act.

According to the DOE, the selected projects will increase generation by an estimated 187,000 megawatts a year, or enough to meet the annual electric usage of more than 12,000 homes.

The Packwood Lake Hydroelectric Facility was built in 1964. It’s located about 20 miles south of Mount Rainier.

Power plant structures at the lake are limited to a small diversion and intake structure a short distance downstream from the outlet of Packwood Lake, according to Energy Northwest.

A five-mile underground pipeline carries the water down the mountain to the powerhouse near the town of Packwood.

The 1,800-foot drop in elevation generates significant pressure at the turbine.

The turbine generator is capable of generating up to 27.5 megawatts of electricity, according to Energy Northwest.

Michael Wagar, The Chronicle – http://www.chronline.com/articles/2009/11/05/news/doc4af31a1dd4e8f547688386.txt

Cushman Hydroelectric plant gets federal stimulus boost November 9, 2009

Tacoma Power will receive $4.7 million in stimulus fund money toward a new generation facility at its Cushman Hydroelectric Project.

The grant, announced Wednesday by U.S. Energy Secretary Steven Chu, will allow the city-owned utility to move forward on the $23.4 million project that will produce enough power for 1,700 homes.

“I believe we were selected for this grant because the new powerhouse we proposed will generate clean, renewable energy from water that we currently discharge from the dam into the Skokomish River,” said Pat McCarty, generation manager for the utility, in a news release. “It also will include a unique fish passage system that will help restore steelhead and salmon runs in the river.”

The project fits in with the utility’s commitment to restore flows and fish in the river as part of a settlement with the Skokomish Tribe.

The utility also received approval of Clean Renewable Energy Bonds that will allow low-cost financing of the project.

John Henrikson, The News Tribune - http://www.thenewstribune.com/southsound/story/942481.html

$230M goes to efficiency upgrades at Rainbow Dam in Mont. October 18, 2009

Against a backdrop of the Missouri River and a 99-year-old power house, PPL Montana broke ground Thursday on a $230 million project to expand the Rainbow hydroelectric plant near Great Falls.

“Thanks for coming — and lets break some ground here,” said Dan Walsh Jr. of general contractor Walsh Construction out of Chicago.

Several old turbines are being replaced with a single, more efficient turbine. A new power house will be constructed to house the turbine.

Pete Simonich, vice president and chief operating officer of PPL Montana, said electricity output would increase to 62 megawatts, enough to power 45,000 homes.

“We will increase by 70 percent the amount of clean, renewable power generated here at our Rainbow facility when this project is completed in 2012,” he said.

The project will create between 100 to 200 construction jobs, Simonich said.

A large crowd of local, state and federal officials turned out for the celebration. Excavation work is expected to begin this week, said PPL’s David Hoffman.

Great Falls Tribune - http://www.greatfallstribune.com/article/20091015/NEWS01/91015003/+230+million+Rainbow+Dam+project+breaks+ground

BPA hopes meter will help manage wind farm power September 17, 2009

Wind energy and hydropower have a see-saw-like relationship: When one goes up the other goes down. But the Bonneville Power Administration is hoping a small device that looks like a model rocket and weighs a few pounds can help ease the tricky synergy.

BPA on Wednesday installed an anemometer to help the power-marketing agency better forecast oncoming wind at the Horse Heaven substation just west of Paterson. The white device with a black propeller on its nose was attached to a bar extended outward about 6 feet off the top of the substation’s 70-foot communications tower.

The data it collects will be linked with 13 other anemometers scattered throughout the region to forecast approaching wind. If BPA has a tighter timeframe of when wind meets wind farms, it can be better prepared to handle the often-sudden influx of wind-generated energy.

Because wind is intermittent, it can be difficult for BPA to prepare for gusts that suddenly, and sometimes rapidly, send hundreds of megawatts of electricity onto the grid. In order to balance the flood of wind-generated electricity, BPA slows hydropower generation at dams.

That causes water to rise behind the dams, reducing the amount of power that can be generated. When the wind begins to wane, that water may have to be rapidly released to compensate for the drop in wind-generated energy.

It’s a balancing act that can be difficult to negotiate. “Basically, you have to spontaneously react to it,” said BPA spokeswoman Katie Pruder.

“We have to hold a large amount (of water) in reserve to be ready for the ups and downs.”

If BPA can better forecast and monitor wind, it should give operators and power schedulers more time to react to sudden surges and decreases of wind-generated electricity. That would allow BPA to store less water, which should result in more hydroelectricity production.

“If we hold less water in reserve, (more energy) can be sold on the open market, which can lower rates,” Pruder said.

John Lodahl, who climbed the 70-foot tower Wednesday and installed the anemometer, said the wind meters eventually will allow BPA to receive updates on wind conditions every two seconds, or nearly in real time. “It’s going to take (the data) and actually plot the wind,” he said.

It took Lodahl about an hour to install the meter on the communication tower, which sat inside the fenced-off substation, where between 115,000 and 230,000 volts of electricity surge through tall lines and a constantly humming transformer. He was helped by Max Holder. With Holder on the ground and Lodahl perched atop the tower, the pair used an antiquated technique to install 21st-century technology by working a pulley system to move bars, tools, clamps and the anemometer to the top of the tower.

Inside the substation’s lone building, Holder installed a data logger, which will relay the information gathered by the anemometer to a central BPA database. Pruder said BPA employees then will use the data to determine how much power will be needed for the next energy load and where that energy will come from. It’s during this process that BPA encounters large swings of unanticipated wind energy, which causes employees to scramble to adjust the hydropower system accordingly.

Pruder said the anemometers and the accompanying data logger system should be fully functional by September 2010. BPA currently has more than 2,200 megawatts of wind energy connected to its grid, although usually just a fraction of that is generated at any given time. On Aug. 6, more than 2,000 megawatts of wind energy pulsed through BPA’s grid, which set a record. Typically, wind energy is generated at about a third of its capacity.

An average megawatt can power about 700 homes annually in the Northwest.

DREW FOSTER; Tri-City Herald – http://www.thenewstribune.com/news/northwest/story/883144.html

BPA Putting Up Meters To Measure The Wind August 19, 2009

The Bonneville Power Administration wants to make better use of wind and water-energy sources. Starting Wednesday, the BPA is installing windmeters — called anemometers — to help do that. Barbara Leidl reports.

The anemometers look like little torpedoes with a tail-fan. They pick up the direction and speed of wind.

BPA spokesperson Katie Pruder says that by installing 14 of the meters in strategic locations, it will be easier to predict when wind energy is available. That in turn will make more efficient use of the hydro back up system.

Katie Pruder: “Accurate forecasting means you have to hold less water behind the dams in reserve to back up wind power, and that’s water that can be used to help meet the growing demands of electricity, that’s water that can be used to help enhance fish runs.”

The BPA has invested $200,000 in the new technology.  The system will be fully operational by September of next year.

BY BARBARA LEIDL, OPB News - http://news.opb.org/article/5658-bpa-putting-meters-measure-wind/

Hydropower: It’s Renewable, But Is It Green? May 11, 2009

A federal judge in Portland is considering how the hydroelectric dams on the Columbia iRver interact with salmon.

At the same time, environmentalists continue to push the Obama Administration to remove several of the hydroelectric dams on the Columbia River.

And that leads us to the next installment in our energy series, The Switch.

Hydroelectric power has long been part of the Northwest’s fabled history. In fact, Woody Guthrie wrote a whole album about building the Columbia River dams.

But in our clean energy future, is hydropower really “green” enough?

Ethan Lindsey explores the issue.
Hydro power and the Northwest. They’re nearly synonymous, even for people who’ve never heard Guthrie’s “Roll on Columbia.”

In fact, when Fran Halpin graduated from college in Massachusetts, it just made sense to move West and work on one of the country’s biggest renewable energy projects.

Fran Halpin: “I came here and got a job with Bonneville, and I said, this is like my dream job. I get to do engineering and I get to be environmentally conscious, and work with fish survival and renewable energy and conservation. Being an engineer, I am not that much of a braggard. People have to pry this stuff out of me. It is a job I am very proud to be doing and happy to be doing. I’ve loved it ever since I came out here.”

Halpin works in the Portland offices of the Bonneville Power Administration.

Today, he heads up a team that watches the water flow of the Columbia River system and markets power accordingly.

Through Halpin’s eyes, the hydroelectric power generated along the Columbia is one of the best answers we’ve got to our energy questions.

His office sits next to a trading floor and monitoring room – both of which feature banks and banks of computer screens.

Fran Halpin: “I have a couple of displays here that I can show you if you want. Ok, so this is about midnight here. So we’re at 1500 megawatts or 1700 megawatts at Grand Coulee. And then it’s dropping off between midnight and 1 o’clock. Turning off the Late Show, electric heaters are turning off. And then, early risers start getting up, so you start seeing the load picking up, people are coming into schools or offices, so the load does come way up.”

The Bonneville Power Administration sells and markets electric power generated from the federally-owned energy projects in the Northwest – that includes wind and nuclear power, as well as BPA’s bedrock business: hydroelectric dams.

On a tour of the Bonneville Dam, the sheer scale of the engineering is breathtaking.

The dams are operated by federal agencies, notably the Army Corps of Engineers.

Dams make up the biggest piece of the Northwest’s hydroelectric pie.

They’re a reliable source of base load power. That and their ability to respond to increased demands at peak times are key selling points of hydro.

Longtime Oregonians remember when hydro constituted more than 90 percent of the state’s power a few decades ago.

Inside the dam, next to the energy turbines, it’s hard to believe that hydro’s share of the regional power mix has now been cut in half.

Population and energy growth has been coupled with a push to sell cheaper power to California.

So now, Oregon gets just 42-percent of its energy from hydroelectric power.

Still, hydro is one of the cheapest – if not the cheapest – power source we’ve got.

The Bonneville Power Administration says its average price per kilowatt-hour over the past year was 2.73 cents.

The only rival is coal – but hydro supporters like to point out the dams don’t pump any pollution into the sky.

And on top of all that, it’s renewable.

Steve Wright: “Well, hydro is clearly renewable. I don’t think there’s any question about that. The fact of the matter is, it’s the cycle of water that we are able to take advantage of.

Steve Wright is the Administrator of the Bonneville Power Administration.

He says it’s also sustainable, and in his mind, green.

Steve Wright: “I believe the fundamental value of the electric power system in the Northwest resides in that river. This is a huge river, and it sits on the side of a very steep hill. And that’s a unique opportunity. Hydro power is the best renewable resource because it is the lowest cost and most reliable renewable resource. And I think that’s why so many people in the Northwest feel connected to the Columbia.”

But Wright, as well as anyone, knows and acknowledges the environmental costs of the dams.

They damaged the nearby habitat, forever changed cultures, and killed lots and lots of fish.

And to Brett Swift at the conservation group American Rivers, a label like “green” or “sustainable” or “renewable” just doesn’t fit.

Brett Swift: “Dams absolutely have an adverse impact on the environment. The important question is ‘what is the role of hydropower in the future of our energy mix. And how we label it doesn’t necessarily inform that.”

Swift says American Rivers knows that hydropower will be a part of the region’s future energy reliance – but says that doesn’t mean we should start building new dams or dismiss getting rid of old, inefficient ones.

One model for future hydro is small-scale, low impact dams.

Jerry Bryan stands next to a small hydroelectric project in the Farmers Irrigation District outside Hood River

The entire facility is about the size of a 7-11.

Jerry Bryan: “You are looking right now at the control panels for both of those generators. I still think that I am staring at engineering technology from the 40s and 50s.”

Unlike a traditional dam, this project allows fish to swim by unimpeded and yet provides local irrigators with the water they need to grow their crops.

Many in the state say little hydro projects like this could serve as models for low-impact, small scale power generation in the future, but Bryan is reluctant to take any praise.

Jerry Bryan: “If I am going to stand here and say a project I am working on is a model for everyone, I am justly accused of affected arrogance. So I am not willing to say that, but what I am willing to generalize is that if people sit down, then wonderful models emerge.”

Bryan says his project isn’t perfect. Every energy source has drawbacks.

And that’s the crux of the hydro debate, says Angus Duncan, with the non-profit Bonneville Environmental Foundation.

Angus Duncan: “There’s a tendency to exalt some sources of energy, and demonize others. And for better or worse, hydro has been demonized in the Northwest. Right now, a far greater threat to salmon runs generally, is global warming. That is a bigger threat than the hydroelectric system.”

Duncan says inefficient and destructive dams are being torn out around the region right now. And that should continue.

But he says if we tear out the big dams,we’ll need to replace that energy with something else.

And until hydro power can be replaced by something other than coal, it’s “green” enough for most.

BY ETHAN LINDSEY, OBP News - http://news.opb.org/article/4953-hydropower-its-renewable-it-green/

Developer pitches unique $1 billion hydropower project in Idaho March 5, 2009

A hydropower developer wants to build a $1 billion, 1,100-megawatt project, in part on federal land, in south-central Idaho.

Symbiotics LLC has filed a request with the U.S. Federal Energy Regulatory Commission for a permit to study building the project several miles west of Salmon Falls Creek Reservoir near Rogerson.

Symbiotics, a multistate company that has offices in Rigby and Boise, wants to build two reservoirs storing 20,000 acre-feet of water behind two 200-foot-tall earthen dams. The project would include a nearly one-mile shaft with 10 turbines buried underneath the site.

Justin Barker, a spokesman with Symbiotics, said the system would be “like a giant battery,” running water between the two reservoirs.

The commission is taking public comments on what is now called the proposed Corral Creek South Pumped Storage Project.

The water pump would itself need to be powered, possibly by wind or solar power.

Barker said the project could cost up to $1 billion. The three-year study, he said, could cost as much as $15 million.

The project includes 1,400 acres belonging to the Bureau of Land Management, and faces some challenges. The Idaho Department of Fish and Game has maps that show sage-grouse breeding sites that could be affected. Sage grouse are being considered for federal protection under the Endangered Species Act.

Finding water to fill the reservoirs could also be difficult. Salmon Falls Reservoir has been low for much of the last decade.

“That’s one of the biggest issues, is whether we can negotiate with the water-rights holders within the region,” Barker said.

Also, a 185-wind farm is planned for the hills west of the proposed hydroproject. However, the two power-producing facilities could end up complementing each other if they are built.

–The Associated Press