RCA rules in favor of GVEA in Delta Wind Farm case

FAIRBANKS – The Regulatory Commission of Alaska (RCA) has resolved all regulatory issues relating to Delta Wind Farm, Inc.’s (DWF’s) request to interconnect and sell energy from its proposed 13.5-megawatt wind generating facility in Delta Junction to Golden Valley Electric Association, Inc. (“GVEA”).

The RCA agreed that a power sales agreement with DWF would lead to higher electric bills. DWF had argued that GVEA should be forced to purchase power from its proposed wind farm under the Public Utility Regulatory Policies Act (“PURPA”).

Wind energy is variable and requires backup from power plants that burn fossil fuels. GVEA’s evaluation and modeling showed that putting more wind power into the grid would have significantly increased GVEA’s fuel and maintenance costs and would have jeopardized reliability.

“In the final analysis, the cost of integrating DWF’s proposed wind project far exceeded the benefits,” said Cory Borgeson, GVEA President & CEO. “Our members would have been economically disadvantaged as a result.”

The RCA’s report went further: “Unless DWF agrees to pay GVEA $0.16 per kWh to take DWF power (which we do not expect it to do), GVEA’s ratepayers will be subjected to higher costs if GVEA takes power from DWF”.

“We are pleased with the Commission’s ruling, particularly that GVEA acted in good faith in complying with the RCA’s regulations and the reasonableness of the modeling presented by the co-op in establishing the rate to be paid for energy from DWF’s proposed project,” Borgeson said. “The Commission’s ruling underscores the fact that under PURPA, a utility such as GVEA is not required to purchase energy from qualifying facilities if such purchases would adversely impact the co-op’s ratepayers”.

“We will continue to work with independent power producers to integrate more renewable power into our system – as long as we can keep our members’ costs low and maintain system reliability,” Borgeson said.

Among Railbelt co-ops, Golden Valley produces the highest percentage of renewable energy. GVEA is able to generate up to 20 percent of its peak load from renewable sources, including the Eva Creek Wind Farm (25 MW), Bradley Lake Hydro (20 MW) and 199 SNAP Renewable Energy Producers (1 MW).

To read the RCA’s Final Order in its entirety, click here.

Note:  This article was picked up by North American Windpower. To read that article, click here.

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