Georgia Power seeks approval for two wind contracts

The Georgia Power unit of Southern Co. (NYSE: SO) on Nov. 4 filed with the Georgia Public Service Commission for approval of two wind-based power purchase agreements (PPAs).

In an effort to continue the diversification of energy resources in its portfolio and to provide reliable cost-effective electric service to its customers, Georgia Power said it is seeking the certification of two PPAs, which represent an opportunity to diversify the company’s generation portfolio and add renewable resources that have energy and capacity value at a price below avoided energy cost projections.

The two PPAs are:

  • A 20-year deal with EDP Renewables North America LLC that will provide energy and capacity benefits from a 151-MW wind facility beginning on Jan. 1, 2016. The Blue Canyon II wind farm consists of 84 Vestas 1.8 MW wind turbines in Comanche and Caddo counties, Okla., and this PPA will terminate on Dec. 31, 2035.
  • A 20-year deal with EDP that will provide energy and capacity benefits from a 99-MW wind facility beginning on Jan. 1, 2016. The Blue Canyon VI wind farm consists of 55 Vestas 1.8 MW wind turbines in Caddo County, Okla., and this PPA will terminate on Dec. 31, 2035.

The company said it believes these resources represent an “extraordinary advantage,” as that term is used in a commission rule, and therefore would be exempt from the commission’s Request for Proposal (RFP) process.

“Because of the significant capacity benefit reflected in these PPAs, the Company is seeking Certification of these PPAs,” the filing said. “This is a long term power purchase for firm energy and capacity. While EDP is paid a single energy payment, a request for Certification is appropriate because the structure of the PPAs is designed to deliver both firm energy and capacity. These resources reinforce the Company’s commitment to provide safe, reliable and cost-effective electricity to its customers. The BCII and BCVI wind PPAs represent an additional opportunity to diversify the Company’s generation portfolio and add renewable resources that have energy and capacity benefits, at a price below the avoided energy cost projections contained within the 2013 Integrated Resource Plan (‘IRP’).”

Georgia Power said it has diligently pursued cost-effective opportunities to expand its renewable generation portfolio in a responsible manner. As a result, there are currently 796 MW of solar generation, 330 MW of biomass generation (including landfill methane gas), and 1,088 MW of hydro generation online or scheduled to serve customers by 2016. Along with the wind resources from the Blue Canyon wind farms, the company’s purchases from renewable generation will grow to almost 2.4 GW by 2016.

Georgia Power said it also continues to engage in the research and demonstration of renewable and emerging technologies as part of its renewable strategy to assess the benefits these technologies can provide to customers.

The PPAs are structured such that the company purchases firm delivered energy, capacity and environmental attributes from the BCII and BCVI wind facilities (or alternate resources as allowed under the PPAs) via two transmission wheels through the Southwest Power Pool (SPP) and the Entergy transmission balancing authorities. This firm delivered energy is below the avoided energy cost projections contained within the 2013 IRP and below the company’s avoided cost projections filed with the commission on Nov. 1, 2012.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.