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Utilities make power pooling progress
Alan Bailey Petroleum News
The Alaska Railbelt electricity utilities have been making significant progress towards the pooling of their power generation capacity, to reduce the cost of electricity for consumers, executives from the utilities told the Regulatory Commission of Alaska on Sept. 27. The idea is to make maximum use of the cheapest available power, regardless of who owns the power generation and transmission facilities.
Following a directive to RCA from the state Legislature to investigate the potential for unification of the Railbelt transmission grid, including the implementation of what is referred to as economic dispatch, the continuous pooling of the most efficient sources of electrical power, in June 2015 the commission issued an opinion that unification should proceed. Since then, the commission has been monitoring voluntary efforts by the utilities to move towards a more unified approach. The Sept. 27 RCA meeting was designed as a review of progress towards the economic dispatch paradigm.
20-year commitment In January the three Southcentral utilities, Chugach Electric Association, Municipal Light & Power and Matanuska Electric Association, signed a 20-year commitment to pool the operation of their generation and transmission assets. The agreement involved a one-year period for the development of the necessary processes and procedures. Progress has now been made, with the specification of procedures for the joint dispatch of power and the settlement of power sales, together with testing and refinement of these procedures, the utilities told the commission during the Sept. 27 meeting.
The two most efficient plants in Southcentral are the Southcentral Power Project, owned by Chugach Electric and ML&P, and Plant 2A, owned by ML&P. These are state-of-the-art, gas-fired, combined-cycle power generation systems.
Since August the SPP and Plant 2A have been loaded to a capacity factor above 90 percent, thus enabling high efficiency use of these systems, Jeff Warner from ML&P told the commissioners. The Southcentral utilities also use hydropower, in particular from the Bradley Lake hydropower system on the Kenai Peninsula. The concept is then to use MEA’s Eklutna Generation Station to handle peaking power supplies, dealing with peaks in power demand above the base power usage, Warner explained. The EGS’s bank of gas-fueled, reciprocating engines powering its generators makes this power plant especially suitable for following varying loads.
Other utilities involved In addition to the three Southcentral utilities, Golden Valley Electric Association, based in Fairbanks, and Homer Electric Association, on the Kenai Peninsula, have been involved in the development of the power pooling procedures. These utilities are interested in the possibility of joining the pool but have not yet decided to do so. For the time being, they will become subscribers to the pool, buying power from the pool as necessary, in conjunction with using their own power sources.
Henry Dale, a consultant for GVEA, told the commission that the Fairbanks utility has some issues that need to be resolved before the utility can commit to a 20-year power pooling agreement. In particular, there are complications relating to the potential incorporation of GVEA’s Eva Creek wind farm into the pool. And the pooling procedures developed thus far will not adequately address large power load swings associated with gold mines that GVEA serves, Dale said.
Larry Jorgensen, director of power, fuels and dispatch for Homer Electric Association, said that the fact that there is just a single transmission intertie between the Kenai Peninsula and the rest of the Railbelt transmission grid currently presents an obstacle to HEA joining the Southcentral power pool. HEA has sufficient power generation facilities on the peninsula to assure reliable power supplies in the event of the transmission line going down. But HEA would be interested in joining the pool if the transmission constraint is removed, Jorgensen said.
“HEA is very supportive of the power pooling effort and very involved in the whole process,” he said.
Moving ahead Mark Fouts, Chugach Electric’s executive manager of fuel and corporate planning, explained to the commissioners how the new Southcentral power pooling arrangements have been moving ahead. An operations committee has been overseeing the procedure development process, with three other committees dealing with power dispatch procedures, the process for settling power sales and the implementation of computer software for managing and operating the system.
The utilities tested new power dispatch procedures in July. Following subsequent refinement of the procedures, by September the utilities in the pool established a power sales settlement process. The next step is to establish a settlement process for the utilities that subscribe to the system rather than participate in the pool, Fouts said. The utilities are also in the process of selecting and preparing the required computer software and control systems for the joint power scheduling, dispatching and settlement arrangements. Ultimately, the utilities will file details of the pooling arrangements with the commission for approval, Fouts said.
Under the procedures, each day a central scheduling service will schedule for the next day the optimum use of generation and transmission assets, and the scheduling of the necessary fuel supplies. The scheduling will take into account the anticipated electricity load profile and the availability of the various assets. On the following day, each utility’s dispatch center will manage the use of the assets, using the centralized scheduling plan. The settlement of payments to the utilities for the use of their assets will then be conducted using a computer system.
A computer system will operate the power dispatch automatically, able to respond to changes much more quickly than a human operator. Then, in the settlement process, a utility that has produced more energy than it has used will be considered an energy seller, while a utility that produces less than it uses will be viewed as a buyer. The power cost savings will then be split between the buyers and sellers of the power.
Procedures will in addition settle the cost of regulating the power to cover short-term fluctuations in load, and to settle the cost of spinning reserves, the reserve power needed to assure the reliability of the power supplies.
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