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A step at a time for transmission grid Utility executives explain moves toward making best use of the most efficient power generation by pooling their resources ALAN BAILEY Petroleum News
The question of how best to pool electrical power resources across the Alaska Railbelt power transmission grid has been a debate that has continued for a number years but now seems to be coming to a head. While utilities have seen significant success in helping each other through the sharing of power to cover fluctuating electricity loads, moves to go further by continuously sharing the least cost power generation and thus minimizing electricity bills now seem close to at least an initial step - two Anchorage utilities are on the verge of blending their power supply arrangements into a more integrated system.
There are six independent electric utilities in the Railbelt, five of which own and operate sections of the transmission grid, with the state of Alaska also owning a grid section. At the core of the transmission grid debate is concern that this balkanization of the grid operation and management inhibits the free flow of electrons across the grid and the optimum sharing of power through what is called “economic dispatch,” the minute-by-minute dispatch of the cheapest power.
During a Regulatory Commission of Alaska meeting on Aug. 24 executives from the utilities talked about their efforts. In June 2015, following an investigation into the merits or otherwise of unifying the Railbelt grid, the commission issued an opinion that unification would be to the benefit of Railbelt electricity consumers. The commission has been giving the utilities an opportunity for voluntary initiatives towards grid unification and has required regular progress reports on what the utilities are doing to that end.
Two issues Lee Thibert, CEO of Chugach Electric Association, told the commission that there are two key issues that need to be addressed to achieve economic dispatch: the development of an economic dispatch mechanism and the configuring of a transmission system that allows economic dispatch to happen.
Chugach Electric and Municipal Light & Power, the two Anchorage based electric utilities, are working together to establish procedures to jointly dispatch their power generation capabilities, thus implementing economic dispatch in the relatively integrated power grid in the Municipality of Anchorage. A key benefit of this arrangement is the synchronized operation of the utilities’ newest and most efficient combined-cycle, gas-fueled plants: the jointly owned Southcentral Power Project and ML&P’s soon-to-be-completed Plant 2A, Thibert said.
On the transmission grid side of the economic dispatch conundrum, a working group composed of the Railbelt utilities and the American Transmission Co., a Lower 48 transmission firm, are developing a proposal for the formation of a transmission company to operate the entire Railbelt grid. This proposal could go to the commission for approval around the end of this year.
Izzo: fuel consumption is key Tony Izzo, general manager of Matanuska Electric Association, told the commission that minimizing fuel consumption at power stations is the key to minimizing electricity costs. A move to full economic dispatch is critical to maximizing fuel savings, although Matanuska Electric has experienced significant success in participating in a voluntary “loose pool,” an arrangement under which different utilities share power on an as-required basis. Matanuska Electric traded back and forth nearly 75 million kilowatt hours of power in just the first six months of this year, Izzo said, adding that it is important that this type of voluntary pooling arrangement continues, to the benefit of the utilities involved.
However, Matanuska Electric has been in discussions with Chugach Electric and ML&P over expanding the embryonic Anchorage “tight pool” to include the Matanuska utility, to thus create a Southcentral economic dispatch system. Matanuska Electric operates a new generation plant at Eklutna, north of Anchorage, powered by an array of gas-fired internal combustion engines, with the option of switching individual engines in and out to match a varying load.
A combined ML&P, Chugach Electric and Matanuska Electric tight power pool, once formed, should be further expanded, as practical, and, together with a unified Railbelt power reliability organization, could provide an avenue for a transition into a unified system operator for the entire grid, Matanuska Electric thinks.
However, Izzo said that MEA still has questions over the formation of a transmission company for the grid. In particular, his utility wants to be sure that the benefits of having a company of this type actually outweigh the associated costs.
The tight pool process Jeff Warner, ML&P chief power dispatcher, and Mark Fouts, Chugach Electric executive manager of fuel and corporate planning, described to the commission the detailed process whereby power would be dispatched by the two utilities under the proposed new tight pooling arrangement for Anchorage, and how the utilities would settle payment for the power supplies. Warner said that the computer system which controls and monitors the utilities’ generators would automatically ensure the continuous use of the least-cost power generation, while settlement calculations would later apportion the power costs between the two utilities. The cost settlement calculations suggest potential cost savings of tens of millions of dollars per year, Fouts said.
Chugach Electric and ML&P are now in the process of showing the methodology to the other utilities, finding out what changes might be needed to meet the other utilities’ needs, Fouts explained.
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