Two weeks ago, Upstate New York Power Corp. told the state Public Service Commission it could not justify the additional cost of running transmission lines under Lake Ontario to Scriba, and suggested the lines should, instead, hit landfall in Hounsfield and run to the Coffeen Street substation of National Grid. The president of Upstate New York Power also suggested in his letter to the PSC that his company will try to sell its power to the Army to power Fort Drum.
Not to say I told you so, but in October 2010 I wrote that Upstate would not, in fact, ever seriously consider a lake-bottom transmission line and that it would continue its pursuit of a land line, either through Henderson and Ellisburg and Richland to a substation in the town of Mexico or to the Coffeen Street substation.
Back then, the New York Independent System Operator, the company responsible for regulating and coordinating the states power grid, had just released a report, Growing Wind Final Report of the 2010 NYISO Wind Generation Study, that suggested that the age and condition of Jefferson Countys connection to the grid was such that up to 15 percent of any wind power that was sent there would be bottled that is, unable to be transmitted. And since even offshore wind operations can only produce a little more than 35 percent of their nameplate, or maximum, power, bottling 15 percent of Galloos power would mean only 20 percent of its maximum generation could be sold.
Any businessman will tell you that if you can only sell 20 percent of what youre producing, youre in a dire situation.
As to the plan to sell the power to Fort Drum, which may or may not affect the generation bottleneck out of the Coffeen Street substation, well, good luck with that. Fort Drum is being wooed by ReEnergy Holdings, the company that bought the old cogeneration plant that used to provide Fort Drum with steam. Its plan is to create electricity by burning biofuels wood and wood byproducts and to sell that energy to the Army. Its close, its reliable and it can provide its nameplate power as long as there is wood and wood scraps to burn. Take a look around and revel in the presence of trees and brush.
Upstate Power, meanwhile, can offer Fort Drum power whenever the wind is blowing enough to produce it. Lets say there is a military or terrorist attack that knocks out power, but Fort Drum needs to have power to respond to the attack. Who they gonna call the company on their post that they can protect indefinitely and whose power can be generated from products on post, or the company that could provide power as long as the wind is blowing at a sufficient rate (and nobody bombs Galloo Island)? Who would you want them to call? Heres a tip: Rep. William L. Owens, a member of the Armed Forces Committee, wants them to call ReEnergy.
Meanwhile, all of the market forces that have been devastating the wind industry continue unabated. Natural gas, a major source of generating electrical power, has dropped to $2 per million British Thermal Units. Wind power begins to make real sense when natural gas sells up around $13.50 per million BTUs. Right now, the energy sources that compete with wind are at historic lows. And the growth of biofuel generators accelerates. For this, and many other reasons that include the problems of bottled power and intermittent sources, wind farms are finding it difficult, if not impossible, to gain power-purchase agreements for their generation, which means they have to sell it on the open market and take their price chances. Selling power on the open market is a brutal game subject to instantaneous fluctuations in price and geared toward peak-power production selling the power when demand is at the absolute highest. That is a trick that is very, very difficult for wind-power producers to pull off because they simply cannot order up some good winds whenever the price of power is highest.
The Galloo Island folks appear to be treading water as fast as they can. Meanwhile, time is running out on their subsidies, as a coalition of Democrats and Republicans in Congress are proving inordinately resistant to the lobbyists calling for a renewal to wind-power subsidies. The battle continues, but with the election coming closer, the likelihood subsidies will be extended appears to dwindle.
And without subsidies, wind power doesnt make sense even if the producers can throw it to the nearest connection to the grid.
Wind power could make sense someday; it may make sense right now in some places. But until it can find a niche in the power grid, and until it can be produced at a truly competitive price without being subsidized, it is a losing proposition. It isnt likely that Upstate New York Power Corp. is unaware of all this, and in reality, any appeal to Fort Drum may be its dying gasp.