BPA proposal would allow continued wind discrimination – Northwest wind generators

Northwest wind generators in a Feb. 13 letter to U.S. Department of Energy Secretary Steven Chu called for the Bonneville Power Administration to comply with FERC’s order to revise its open access transmission tariff (OATT). 

The letter came in response to a proposal BPA released Feb. 7, according to which BPA would compensate wind generators for curtailment, according to a proposed methodology and formula for compensation. It would also submit to FERC a voluntary “reciprocity” transmission tariff, which it would be able to revoke at will without FERC approval, the wind generators said. 

“Not only would such a voluntary reciprocity filing contravene the FERC Order, and prejudge a crucial issue in the regional settlement discussions, it also would fail to address a root cause of the issues that led to the litigation – a lack of adequate oversight of BPA’s transmission system operations,” the wind generators said. 

FERC, in a December 2011 order granting relief to five complainants who argued BPA’s transmission policy was discriminatory, ordered BPA to file a revised OATT that treats wind energy on its system the same way it treats its own hydro generation. BPA in the spring of 2011 began curtailing wind energy in favor of hydropower, prompting Horizon Wind Energy, Invenergy Wind North America, PacifiCorp, NextEra Energy Resources and Iberdrola Renewables to file a complaint with FERC. These companies were signatories on the Feb. 13 letter to Secretary Chu. 

BPA on Jan. 6 requested rehearing of the FERC order, which FERC granted on Feb. 6. 

“BPA’s self-regulation of its transmission system has harmed customers,” the wind generators said in the letter. “It is essential that BPA comply with FERC’s December 7 Order by filing with the Commission an OATT that may only be modified in the future with FERC approval. Significantly, the Complainants acknowledge that BPA’s OATT can include variances from the Commission’s pro forma OATT that address unique regional situations, but an independent regulator – not Bonneville itself – needs to be the final arbiter of such BPA variance proposals.” 

According to the letter, BPA markets about 40% of the power generated in the Northwest and operates “more than three-quarters” of the region’s high-voltage transmission system, “including the largest transmission paths into California,” the letter signatories said. “It is essential for all consumers in the region that the transmission grid be operated in a nondiscriminatory manner.” 

Though BPA said its proposal reflected discussions it has held with Northwest wind interests, the letter suggested the proposal was premature and did not reflect settlement talks. 

Several of the companies who signed the letter are engaged directly in discussions with BPA, they said. “However, contrary to these settlement efforts, BPA … unilaterally published for public comment a proposed mechanism for addressing future situations when BPA has an excess supply of Federal hydro generation, including a methodology for allocating compensation costs associated with the curtailment of wind power generators.” 

The letter also refuted a claim that some congressional delegations have made that the order FERC issued in December suggested its authority superseded that of the BPA. Because BPA technically falls under the jurisdiction of the U.S. Department of Energy, FERC in its December order invoked section 211A of the Federal Power Act, saying BPA’s curtailment of wind energy in favor of hydroelectric power was discriminatory and preferential. 

“The Complainants never argued that Section 211A ‘overrides’ BPA’s other statutory obligations,” the wind companies said. “Rather, BPA’s responsibilities under Section 211A should be considered to the same extent as such obligations.”

Renewable Northwest Project, a nonprofit renewable energy advocate, on Feb. 13 said BPA’s proposal was “deficient,” and its focus too narrow. 

“Our opposition centers on the principle of non-discrimination and contractual sanctity, both of which are essential to ensure continued momentum for new renewables and related economic vitality in our region,” Rachel Shimshak, executive director, said in a statement. “Wind generators are willing to consider some cost allocation, but only if BPA fulfills the FERC request to file an enforceable tariff that will ensure non-discrimination.” 

About Rosy Lum 525 Articles
Rosy Lum, Analyst for TransmissionHub, has been covering the U.S. energy industry since 2007. She began her career in energy journalism at SNL Financial, for which she established a New York news desk. She covered topics ranging from energy finance and renewable policies and incentives, to master limited partnerships and ETFs. Thereafter, she honed her energy and utility focus at the Financial Times' dealReporter, where she covered and broke oil and gas and utility mergers and acquisitions.