Bonneville Power Administration Institutes Lower Wind Integration Rate

Posted by NAW Staff on July 22, 2009 No Comments
Categories : FYI

Bonneville Power Administration (BPA), a not-for-profit federal electric utility that markets more than one-third of the electricity consumed in the Pacific Northwest, has announced numerous rate changes that are expected to take effect Oct. 1.

BPA has instituted a wind integration rate of $1.29/kWh per month – a reduction from the initial rate proposal of $2.72/kWh per month. This is due primarily to actions taken by wind generators to reduce their use of BPA generation for reliability when wind power ramps up or down unexpectedly.

‘There's been an explosion of wind power on the BPA system, especially since 2005,’ says BPA Administrator Steve Wright. ‘We're proud of this accomplishment, but it has led to operational challenges, including risks to reliability and substantial costs. The wind integration rate, which has been reduced due to collaboration with the wind power industry, will help address those issues and put us in a position to bring more wind on board than would have been possible just a year ago.’

BPA's aggressive approach to integrating wind is one of the reasons the agency continues to have the largest ratio of wind relative to load of any transmission provider in the U.S.

The new rates will remain in place until October 2011. How the rates will affect retail rates will vary according to utility, due to a number of variables, such as what portion of a utility's power or transmission is purchased from BPA.

In addition, rates for customers that buy power and transmission will increase by an average by 6%. Transmission rates will stay the same. Power rates will increase by an average of 7%. This is the first power rate increase since 2002, and it is driven by both rising costs and decreasing surplus revenues.

BPA's relatively new rate for wind integration services has been reduced substantially from the initial proposal due primarily to efforts from the wind power industry to improve its operational practices.

The new rates cover fiscal year 2010-2011. Under the rates, the average priority firm rate for wholesale power is $28.77/MWh. That compares to the previous rate of $26.90/MWh.

SOURCE: Bonneville Power Administration

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