The Whispering Willow Wind Farm in Franklin County, shown in an undated photo. CREDIT/ALLIANT ENERGY
By Dave DeWitte
Plans announced by Alliant Energy this summer to more than double the company’s wind energy production in Iowa will help keep customers’ energy costs low for decades to come, the company’s head of energy production says.
Alliant Energy stated in July that it plans to add 500 megawatts of wind energy to its generation portfolio over a five-year period. The utility hopes to get the roughly $1 billion investment approved by state regulators by the end of the year in order to secure a 100 percent renewable energy production tax credit. If the state review drags into 2017, the federal production tax credit declines to 80 percent.
The economics of the plan should play out well for Alliant customers, according to Terry Kouba, vice president of generation operations for Alliant. He said the increase in base electric rates that is expected to result from the $1 billion investment will be offset by a reduction in the fuel surcharge, a cost on customer bills that reflects the utility’s costs for coal, natural gas or other fuel.
“There is a zero fuel cost plus production tax credit benefit that will offset any increase in base rates over the life of the assets,” Mr. Kouba said.
The wind power investment also makes sense for Alliant because it is increasing its power production capacity using highly efficient combined-cycle natural gas generation facilities, including one it plans to open next year in Marshalltown. Unlike older plants that burn coal, the combined-cycle plants can quickly ramp production up or down to compensate for fluctuations in energy production as wind speed rises and falls.
Alliant plans to locate 200 of the 500 megawatts of new wind generation capacity at its Whispering Willow Wind Farm in Franklin County, roughly doubling the current production capacity at the location.
The company has commissioned a study to determine where to place the remaining 300 megawatts, but it won’t just be looking at wind resources. Mr. Kouba said access to the electric grid will also be an important siting factor, because a large investment to build transmission lines to bring the wind power onto the grid would weaken the economics of the project.
The Whispering Willow Wind Farm could end up becoming the site for even more than the 200 megawatts already planned. It has both good grid access and a good wind resources as measured by the capacity factor, which is a ratio of the actual output of a generation facility to its theoretical output if it could operate at full capacity all the time.
Improvements in wind turbine technology since Whispering Willow was dedicated in late 2009 will also boost the economics of the project, Mr. Kouba said. Wind turbines can now generate more watts of power with the same amount of wind.
Alliant Energy’s wind investment announcement was followed last month by the state regulatory approval of MidAmerican Energy’s Wind XI project. That $3.6-billion project is the largest yet for MidAmerican, and will add about 1,000 wind turbines on sites distributed around the state over a three-year period beginning in 2017.
Solar flaring up
Increasing the use of wind energy is part of Alliant’s strategy to lower its carbon dioxide emissions 40 percent from 2005-2030. The utility is also becoming more active in solar energy, with two Alliant-owned solar projects in Dubuque and a third awaiting completion at the Indian Creek Nature Center’s Amazing Space facility in Cedar Rapids. It will also work with customers who want to develop and own solar power systems.
“We’ll own some and our customers will own some,” Mr. Kouba said.
Mr. Kouba said Alliant sees the potential to maximize the value of the solar power generated in its service territory by using technology to operate and dispatch it as a virtual power plant. That would provide a means to generate a payment differential from MISO, the regional transmission system operator, for providing capacity that can be relied on at peak periods.
Currently, Alliant has 1,300-1,600 customers with solar power installed, generating a total of about 24 megawatts.
Alliant continues to convert coal-burning generating units at its power plants to natural gas as low prices have made gas, with its lower air emissions and no ash waste, more economical. By the year 2025, Mr. Kouba said Alliant expects to have only two coal-burning power plants on its Iowa generating system.