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Contact: Dick Watson, Power Planning Director
or John Harrison, spokesman, 800-452-5161
March 7, 2001
Drought will complicate fish and power decisions in 2001, Council
analysis shows
PORTLAND, Oregon -- Western electricity markets are headed for a
difficult summer and possibly a difficult winter, according to an analysis
by the Northwest Power Planning Council.
With 2001 shaping up as the second- or third-driest of the last 73
years, the Northwest will have far less hydropower than normal this
summer, the Council’s analysis shows. The Council’s staff discussed
the results today with the Council at a meeting in Portland.
In order to keep the lights on in the Northwest this winter, reservoirs
behind hydroelectric storage reservoirs in the Columbia River Basin have
been drafted deeper than limits established to protect endangered species
of salmon and steelhead. The 2000 Biological Opinion on Hydropower
Operations, a document issued by the National marine Fisheries Service on
behalf of threatened and endangered species of salmon and steelhead, sets
limits on reservoir drawdowns during winter months in order to have water
available for release in the spring and summer to help juvenile fish
migrate to the ocean. Drafting reservoirs deeper than the Biological
Opinion limits has no immediate effect on fish, but the current drafting
will reduce Columbia River flows by about 3 percent in the spring and as
much as 15 percent in the summer, the Council’s analysis indicates.
The Biological Opinion also calls for spilling water, and therefore
juvenile fish, over lower Columbia and Snake River dams this spring. While
spill is an effective means of moving fish past dams, it also takes water
away from hydropower generation -- water that might prove critical in this
dry year, according to the analysis. Reducing spill could help reservoirs
refill later in the year, and the additional power generation would mean
that Bonneville and its customer utilities would not have to purchase as
much power on the spot market, where prices are high. The Council’s
analysis suggests that reducing spill by 35 percent between April and
August would yield about 800 additional megawatts of electricity --
roughly enough for a city the size of Portland.
The Council’s analysis is the latest version of an ongoing effort to
assess the West Coast power crisis and recommend actions to ease its
effects on utilities and power consumers. The analysis is considered a
draft at the moment, but it will be finalized shortly. The Council’s
draft analysis includes the following recommendations for the region’s
energy policymakers:
- Continue to bring new thermal plants online.
The flip side of high prices is that they do encourage new
generating plants and demand-reduction efforts, which should lead to a
more diverse power supply over the long term. A total of 800 new
megawatts of thermal generation, mostly natural gas-fired, will come
online by this summer in the Northwest; 700 more is expected by next
winter, and there are plans for 2,500 more by 2003. According to the
analysis, the permitting and siting process has not been an impediment
to building new power plants, and considering the number of new plants
that are permitted and will be coming online in the near future, there
is no need to relax regulations to encourage more rapid development.
Continue to develop renewable resources.
Planned hydropower upgrades in the Northwest will yield 80 new
megawatts of capacity by 2003; two new Northwest wind power developments
will yield 325 megawatts of capacity, including 100 megawatts by the end
of this year.
Add temporary new thermal generation.
500 megawatts of temporary generation, typically clusters of
generators fired by natural gas or diesel, will come online this year in
the Northwest. Permits for these generators should be conditioned to
ensure that they meet criteria for environmental protection, air pollution
and noise, and that there is a time limit on their operation, after which
the plants could continue only if approved through normal siting
processes.
Continue to inform public about the problem.
The public needs to understand the problem is real and that efforts at
home will help ease the crisis.
Expand energy conservation efforts.
The Council recommends the following actions: 1) change incandescent
bulbs with compact fluorescents; 2) upgrade commercial lighting to improve
its efficiency; 3) “tune up” HVAC systems in commercial buildings to
improve efficiency; 4) replace industrial electric motors with more
efficient motors; 5) retire second refrigerators in homes (20 percent of
Northwest homes have two; old ones use twice as much electricity as “Energy
Star” models); 6) accelerate replacement of existing clothes washers (“Energy
Star” models use 35 percent less electricity and 35-45 percent less
water).
Pursue industrial/commercial demand reduction.
The Council recommends: 1) pursuing interruptible contracts, 2) new
contractual mechanisms between utilities and large customers to reduce
demand for power; and 3) short-term power buybacks from large customers.
Explore power pricing changes to reflect market prices and risk.
Regulatory agencies should adopt real-time pricing of power. Power is
more expensive when demand is high, in the early morning and early
evening, than other times of the day. Pricing could reflect these
differences. Most consumers don’t see real-time (marginal cost) prices.
If they did, they would have more incentive to reduce consumption and
invest in energy efficiency measures.
Explore new energy policies.
Price controls on wholesale power could help reduce costs, but
controls are controversial and should be short term, if imposed at all, so
they don’t stifle new investment in generation and conservation. In the
short term, regulatory agencies should consider expanding low-income
assistance programs and encouraging demand-reduction programs to minimize
the impact of high power prices on business and industry.
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