When South Dakotans harvest the nation's fourth-best wind power (1,030 billion kWh each year) using small, community, and large wind turbines, we can increase generating capacity additions. This satisfies, in the context of EIA’s modeling framework, one aspect of changes in electricity prices we can influence. EIA identified a fall in prices likely due to
First and most important, both the rise and fall in electricity prices correspond closely with projected fuel costs.
Second, generating capacity additions underlying EIA's forecast are not dramatic in the near term, as EIA projects about 50 GW of additions over the period through 2014, well below NERC’s forecast of 86 GW. Thus, therate base for generation is not growing at a significant pace in the near term under EIA's projections.
Price volatility is expected in commodity markets and electricity markets are particularly volatile because, unlike most other commodities, electricitycannot be stored and its short-run demand is highly price inelastic.
This makes electricity prices particularly sensitive to sudden changes in market conditions, such as the loss of a large generating plant or largetransmission line, or large shocks in input costs.
The primary advantages of renewables are low, stable operating costs and the environmental benefits of little or no air and water emissions. However, renewable technologies generally are more costly to build (on an installed $/kW basis), although construction times for wind and solar are typically shorter than for fossil-based generation capacity.
While some biomass and geothermal operate as baseload capacity {constant minimum available power}, wind and solar have lower capacity factors {rated power output} and their power output is intermittent because they are based on variable resources. Renewable resources also vary quite substantially in their geographic distribution.
Wind capacity has been growing at about 20 percent per year recently, which has largely been a result of renewable requirements established at the state level and the periodic renewal of the production tax credit allowed for renewables, there also has been increased demand from customers of “green” electricity at a premium rate offered by utilities.
The need for additional utility generation and transmission will be mitigated to some extent by increased development of small, onsite customer generation. Such generation is typically known as distributed generation (DG). Examples of DG include microturbines, biomass-based generators, small wind turbines, solar thermal electric devices, and backup generators at office buildings, industries, and hospitals.
In contrast to large, central-station power plants, distributed power systems typically range from less than a kilowatt to tens of megawatts in size. Energy Information Administration (EIA) projects that 5.5 GW of DG, or slightly less than two percent of all new generating capacity, will be installed over the next 25 years. {On-site small, community, and large wind turbines}
In addition to reducing the need for generation investment, optimally sited DG can reduce the need for transmission and distribution investment while resolving some system constraints and reducing line losses.
Section 1251 of EPAct 2005 encourages the development of small, onsite generation by requiring states to consider if utilities should make net metering services available upon request to any customer.
EPAct 2005 Amends the Public Utility Regulatory Policies Act of 1978 (PURPA) to require each electric utility to make available upon request net metering and time-based (smart) metering service, including credits for consumers with large loads who enter into pre-established peak load reduction agreements that reduce a utility's planned capacity obligations.
(Sec. 1253) Declares that no electric utility shall be required to enter into a new contract or obligation to purchase electric energy from a qualifying cogeneration facility or a qualifying small power production facility (qualifying facility) if FERC finds that the qualifying facility has nondiscriminatory access to certain specified relationships.
(Sec. 1254) Requires each electric utility to make available, upon customer request, interconnection service to any electric consumer it serves (under which an onsite generating facility on the consumer's premises is connected to local distribution facilities).
Concludes with Part 2 on Friday.
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A handful of South Dakota wind-
7 PM Jun 07, NNW at 28 mph, light rain
2 PM Jun 07, SW at 28 mph, thunder in the vicinity
9 AM Jun 07, WSW at 9 mph
3 AM Jun 07, SW at 30 mph
8 PM Jun 06, S at 25 mph.
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'Til next time. Best Wind.
