20/20 sponsors: Utilities don't offer wind choice
The dirty little secret about wind power in Grand Forks is that even though the utilities say you can choose to buy it, you really can't. That's the charge made by supporters of Grand Forks' City 20/20 renewable energy initiative. They've been sa...
The dirty little secret about wind power in Grand Forks is that even though the utilities say you can choose to buy it, you really can't.
That's the charge made by supporters of Grand Forks' City 20/20 renewable energy initiative. They've been saying it for some time, but this week, they were more specific.
Nodak Electric, which offers the Infinity Wind Energy program, has sold all of the wind energy it has, said Dexter Perkins, a member of Citizens for Affordable Renewable Energy. And Xcel Energy, which is soon to offer the Windsource program, has priced it out of the market for most people, he said.
CARE is arguing that a vote for City 20/20 is a vote by consumers for the choice to buy wind energy. But utilities have brushed off this claim by saying that their customers already have that choice with Infinity or will soon have a choice with Windsource.
As it turns out, Perkins is right, though interviews with utility representatives suggest a more nuanced picture.
City 20/20 would require 20 percent of electricity sold in Grand Forks come from renewable sources, most likely wind, by 2020. The requirement rises to 30 percent in 2030.
Out of power?
Let's take the charge that even if a Nodak customer wanted to be a wind subscriber he wouldn't be able to do so because there isn't any more wind energy to buy.
Is it true? It sure is.
"We're not offering subscriptions because we don't have online generation," said Nodak president George Berg.
The cooperative buys wind energy from a 900-kilowatt Valley City, N.D., wind turbine owned by Minnkota Power Cooperative, of which Nodak is a member, and all of the electricity has been spoken for. (Another turbine of the same size in Petersburg, N.D., serves Grand Forks Air Force Base.)
But, Berg said, that's not the end of the Infinity program - just a pause.
Minnkota is looking into building a 60-megawatt wind farm - that's about 67 times more power than the Valley City turbine alone - and once the new turbines are up, Nodak customers can buy all of the wind energy they want. Either that, or Nodak could raise rates slightly for everyone.
Berg said there's a debate whether to spread the costs out to all customers, if the resulting rate hike is not excessive, or concentrate it among only subscribers.
Perkins said he applauds Minnkota's and Nodak's efforts, but it would only meet the goals of the initiative if there were widespread use of wind energy rather than a few subscribers.
As for the charge against Xcel's excessive wind energy charge, Perkins said that the utility is asking for a 5.3-cent per kilowatt-hour premium on top of the regular cost of electricity. That's a ludicrous rate given that the premium for the Infinity program was only 1.5 cents, a premium Minnkota has ceased to charge because wind power just doesn't cost that much anymore.
Is it true? It is.
But, as Xcel's senior regulatory consultant Dave Sederquist said, Windsource subscribers won't have to pay the 2- to 3-cent fuel surcharge that nonsubscribers pay. That reduces the premium to about 2.3 to 3.3 cents per kwh.
The main reason for the fuel surcharge is the unstable price of natural gas-generated electricity, which wind energy is gradually replacing as a supplemental source of electricity.
But why are Xcel's costs higher than Minnkota's?
Sederquist said older towers were built at a time when material costs such as steel were not as high as they are today. Xcel is pricing its wind power at a level needed to build new turbines in North Dakota, he said, and will bring down the premium if the cost proves less than expected.
Perkins said he couldn't dispute Xcel's numbers without more research, but believes they may be more costly than necessary. The present difference between wind energy and conventional energy on the market, he said, is only half a cent.