Golden Valley starts green power program

GVEA would like to accept power from member-owned renewable sources; utility also developing wind power on its own

Stefan Milkowski

For Petroleum News

Golden Valley Electric Association is clearing the way for independent power producers in an effort to boost its share of energy coming from renewable sources and study how renewable energy projects will affect its electric grid.

The Fairbanks utility is seeking permission from the Regulatory Commission of Alaska for a new program allowing medium-sized energy producers to sell green power to GVEA.

The program, called the Experimental Renewable Resource Purchase Program, would apply to member-owned projects using wind, solar, geothermal, hydro or biomass energy and producing up to 2 megawatts of power. Energy producers would be paid for the electricity they contribute at GVEA’s avoided cost price, which is calculated quarterly, or at a fixed price agreed upon by both entities. The program will not increase electricity costs for any utility customers, according to GVEA spokeswoman Dianne Porter.

The program is limited to a combined 12 megawatts of power.

Golden Valley developed the program partly in response to efforts by Fairbanks-based Alaska Environmental Power LLC to develop up to 40 megawatts of wind power in the Interior. The company was formed in 2006 by Mike Craft of Fairbanks and two partners. It has purchased land in Delta Junction and near Healy and secured permits for the installation of 20 megawatts of wind power at each of the two sites, according to Craft. The company commissioned a 100-kilowatt turbine in September in Delta Junction and plans to install another 19 turbines of the same size next year, for a total of 2 megawatts.

Golden Valley agreed to buy power from Craft under the terms spelled out in its new program. Porter said the utility was “certainly amenable” to projects larger than 2 megawatts but had to make sure they wouldn’t harm Golden Valley’s system, especially in the case of wind, which produces power only when the wind is blowing.

“This is kind of an intermediate step to allow us to evaluate some of those issues while getting more wind involved,” Porter said.

Craft said he saw the agreement as something of a test and planned to push ahead with a 20-megawatt project once Golden Valley was willing to negotiate a power purchase agreement.

GVEA also pursuing wind

The utility received $28,000 from the Alaska Energy Authority in June to study interconnection issues for the Eva Creek project, and is seeking additional state funding now for final design, permitting, and construction, according to Porter.

Golden Valley’s board of directors approved a green power pledge in 2005 calling for 10 percent of the utility’s peak load to come from renewable resources by 2007 and 20 percent by 2014. GVEA met its goal in 2007 through its share in the Bradley Lake hydroelectric project and conservation measures.

Under the new program, power producers will be free to seek state and federal construction grants and federal production tax credits. Golden Valley will obtain the rights to any “environmental attributes” of the power, although Porter said she wasn’t aware of any plans to market those attributes.

John Davies, research director at the Cold Climate Housing Research Center and a member of GVEA’s Green Power Advisory Committee, said the committee supported the new program but would have liked the utility to offer a premium for green power.

“We would like to see GVEA incentivizing the shift to non-greenhouse gas producing power systems,” he said.

The utility already has a program for members producing small amounts of renewable energy. The Sustainable Natural Alternative Power, or SNAP, program subsidizes green power producers through voluntary contributions from members. Projects are limited to 25 kilowatts or less.

The RCA is accepting public comments on the new program through Oct. 23.