After time back at the drawing board, SWEPCO has crafted a new plan to add wind energy into its power mix.
About this time in 2017, the utility’s representatives were spreading the word about the Wind Catcher initiative. That $4.5 billion proposal was ultimately canceled in July 2018 after meeting resistance and being rejected by the Texas Public Utility Commission.
Still committed to diversifying its generation capacity through green means, wind and solar, SWEPCO took the feedback and crafted a new proposal, aiming to add 810 megawatts in wind energy by 2022.
“As we look out where our industry is going and what the expectations of our customers are, of our regulators, it’s very clear we’re going to have to reduce our carbon emissions,” says SWEPCO’s Brian Bond, vice president of external affairs. “Wind is more cost-effective at this point than solar. It’ll help reduce our carbon footprint, which is a full expectation of our communities that we live in as well as our regulators as they attempt to try to address climate change.”
The new venture includes three wind-farm sites in north-central Oklahoma: Traverse (to produce 999 megawatts with turbines near Weatherford, with completion set for 2021), Maverick (287 MW southwest of Enid, completion in 2021) and Sundance (199 MW, northwest of Cleo Springs) which should be ready in 2020. Of the total generation, about 55 percent will go via SWEPCO’s grid to Arkansas, Louisiana and Texas.
The total project cost is more than $1 billion, Bond said, about one-third of Wind Catcher’s price tag.
“We’ll seek to recover that through rates. We’re able to take advantage still of the production tax credits. Ultimately our customers will save our $2 billion over the life of the project.”
It’s part of the broader plan to diversify the utility’s energy, particularly toward wind and solar, which SWEPCO intends will represent one-third of its generation by 2040. The new proposal would put wind at 21 percent of the utlility’s energy mix.
“We’re going to keep our existing coal units and generating capacity. We’ll retain that, which is still delivering a lot of value to our customers,” Bond said, but it will represent 44 percent of SWEPCO’s generation by 2038, compared to 83 percent now. “We’re able to bring flowback benefits from those units to all our ratepayers.”
He’s hopeful communities will get behind the new effort: “Last time they didn’t believe that the benefits outweighed the cost.”
Kilgore was part of the combined effort resisting Wind Catcher, through CARD, Cities Advocating Reasonable Deregulation. Council members recently lent their support to the group’s upcoming efforts to analyze SWEPCO’s new wind project.
“It allows us to evaluate and come up with an opinion of whether or not this will be good or bad for the ratepayers in the region,” Kilgore City Manager Josh Selleck said. “Our goal is to ensure that when it comes down to the end result, that our ratepayers don’t end up bearing the cost of a guaranteed return to investors on the utility side,” a prominent concern about Wind Catcher.
“If it’s good for everybody, everybody should be guaranteed a return.”
According to Bond, SWEPCO’s customers will see a benefit, with no increase to their total bill.
“Their base rates will increase, but then the fuel costs will be zero dollars. On top of that, they’re getting the value of the production tax credits,” he said. “This project will deliver savings to the customers and will reduce and provide savings over the 30 year life of the project.
“There’s immediate savings from day one once the project goes into service.”
For more information, log on to SWEPCO.com/CleanEnergy.
“We’re going to hold some public meetings in our communities to give the citizens an opportunity to come learn about this project, ask questions,” Bond said. “I feel like the more informed that they are, the more they’ll be able to voice their support for the project.”
According to Bond, the project is based on the energy value that it brings versus capacity.
“Right now from a capacity standpoint, SWEPCO is in good shape,” he said. “We’re meeting our reserve requirements for the southwest power pool.
“It allows us to construct the project and reduce the bills for our customers while still reducing overall emissions. It’s more of an energy investment than it is for capacity sake.”
The wind projects will operate 45 percent of the time, adding capacity to SWEPCO’s overall portfolio.
“Our coal units continue to be the backbone right now of the capacity that we’re utilizing to serve our customers and customers throughout the southwest power pool,” Bond said. Hopefully, balancing emissions will lead to other benefits as well. For example, “European manufacturers won’t even consider locating where’s that not a good commitment to renewable. The folks that are in economic development understand the importance of SWEPCO trying to diversify and add renewables to its portfolio.”