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Plunging Wind Into the Grid

The California ISO's intermittent resource program addresses a key market barrier to wind power: how to schedule wind energy in forward markets.
Fortnightly Magazine - June 15 2003

also a major concern of the wind power industry, Smith notes.

Caldwell says there is a major mismatch between the needs and characteristics of the wind power industry and the procedures currently employed in transmission planning. "The small project size and quick development time of wind farms are not easily accommodated in today's transmission investment planning decision-making process." In addition, he says, the remote location and low capacity factor of wind farms translate into a higher transmission investment per unit of power output.

The key barrier to bringing significant new wind power capacity online in California during the 2001 energy crisis was the lack of transmission capacity from the Tehachapi area. The availability of transmission access is the single most important barrier to wind power development, not only in California, but throughout the country. California's power market reflects this reality. When the Union of Concerned Scientists modeled what types of renewable resources would come online in California if the state doubled its renewable energy purchases by 2010, they assumed interconnection costs for wind power were four times the cost associated with a natural gas power plant. The range of interconnection costs for wind power facilities to the transmission grid starts at $13/kW but can be as high as $825/kW.

A 1998 Lawrence Livermore Laboratory study that examined 36 California sites found that most of the large wind resource areas in California have interconnection costs under $50/kW. According to this study, the best existing wind site in California is San Gorgonio, which has the potential for 309 MW and is only 1.3 kilometers from a transmission line. The interconnection cost was estimated at $22.8/kW or $469,000. An additional $3.5 million would be required to lay lines within the wind power project to hook up to the transmission grid. The highest interconnection cost identified in the study was a 12-MW potential project at Boulder Park. The interconnection cost was projected to be $825/kW or $6.7 million to extend the interconnection line 50 kilometers and another $160,000 to lay lines within the project.

Since the RPS law could add 2,000 to 3,000 MW to existing 1,800 MW of wind power capacity in California, the California ISO also will be taking a closer look at renewables and the transmission infrastructure needed to foster their development.

Wind is the fastest growing power source globally. Approximately 4,500 MW of wind power is currently operating nationwide. The AWEA has set a goal of 100,00 MW by 2020. Last year was another record year for the wind industry. Though the U.S. market grew by only 10 percent due to the uncertain status of the federal wind energy production tax credit, a record 6,868 MW was installed worldwide. That figure represents a 28 percent increase in global wind power capacity. Extending the federal production tax credit is gaining broad bipartisan support as wind power moves into the mainstream of power generation options.

As wind generation increases throughout the country and the world, the California ISO Participating Intermittent Resources Program is likely to serve as a model for resolving market barriers for