By Andy Balaskovitz, Energy News Network
“The market dynamics have changed. This notion of running power plants all out, all year round no longer makes sense.” – Joseph Daniel, senior energy analyst at the Union of Concerned Scientists. Daniel also argues that coal plants should no longer be considered a “base load” resource.
Uneconomic coal plants have cost a Michigan utility’s customers tens of millions of dollars a year by running at times when cheaper resources are available, according to energy analysts. Three plants owned by DTE Energy in southeastern Michigan, in particular, lost $74 million in 2017, filings show in a rate case settled last year.
The practice is known as “self-scheduling” or “self-committing,” when utilities designate certain power plants to run regardless of the price grid operators are willing to pay for the electricity. Utility regulators in Minnesota and Missouri have opened dockets on the subject, while Wisconsin advocates are putting pressure on state regulators to examine the practice there. Continue reading here.
Photo Credit: Fermite1 / Wikimedia Commons: The Trenton power plant in Trenton, Michigan.
About Joseph Daniel
Joseph Daniel, senior energy analyst at the Union of Concerned Scientists, has been studying self-committing or self-scheduling generation in power markets for years. Daniel completed an analysis screening of every coal-fired power plant that operates in the Southwest Power Pool (Nebraska’s Regional Transmission Organization) and other RTOs. He describes the analysis in an interview included in the following article posted on the Union of Concerned Scientists’ blog:
The Billion-Dollar Coal Bailout Nobody Is Talking About: Self-Committing In Power Markets
Markets are supposed to ensure that all power plants are operated from lowest cost to most expensive. Self-committing allows expensive coal plants to cut in line, pushing out less expensive power generators such as wind, depriving those units from operating and generating revenue.
Previously Posted E&E Articles
Report: Kansas Utilities Run Coal Plants Year-Round Even Though It Costs Ratepayers Millions, KMUW, Wichita’s NPR Station
The way Westar Energy runs its coal plants in Kansas unnecessarily costs consumers millions of dollars a year through an obscure, if common, practice known as self-committing generation. The company essentially runs its coal plants year-round, even during the winter months when it’s not cost-effective. An analysis by the Union of Concerned Scientists, which advocates for reduced reliance on coal, says that’s been costing Westar customers $20 million a year in added fuel costs. But market operators including the Southwest Power Pool (SPP) — Westar buys and sells wholesale electricity through the organization — worry that the practice hurts the market. Regulators in Missouri, where Westar’s parent company Evergy is headquartered, have opened up an investigation to see if it’s unfairly costing consumers
At our state’s largest coal plant, the Gerald Gentleman Station, and all across Nebraska, renewable energy is becoming increasingly cost-effective. NPPD’s R-Project will “provide additional opportunities for development of renewable projects if desired at the local level.”
On-and-Off Wind and Solar Power Pushing Coal Plants to the Brink, Bloomberg
The Gentleman coal plant was once the linchpin of Nebraska’s electricity grid, its twin smokestacks visible for miles across the prairie. Now, the state’s biggest power source is routinely pushed aside to make room for more wind and solar energy.
NPPD Photo: The Gerald Gentleman Station, located just south of Sutherland, is Nebraska’s largest electricity generating plant. The station consists of two coal-fired generating units which were launched into service in 1979 and 1982 and which together have the generation capacity of 1,365 megawatts of power.
NPPD’s R-Project: Reducing transmission congestion and providing opportunities for additional renewable energy
NPPD’s R-Project is a 345,000-volt transmission line from NPPD’s Gerald Gentleman Station near Sutherland to NPPD’s existing substation east of Thedford. The new line will then proceed east and connect to a second substation to be sited in Holt County.
NPPD’s electric grid is an essential link to ensuring service for our customers. The R-Project will increase the reliability of the transmission system, relieve congestion on the existing system, and provide additional opportunities for development of renewable projects if desired at the local level.
Southwest Power Pool’s Role
NPPD is a member of the Southwest Power Pool, a regional transmission organization. The SPP conducted a study, also known as the Integrated Transmission Plan, to assess the needs of the entire transmission network with the SPP region over the next 10 years. The R-Project is one of numerous projects to come out of that study.
Follow R-Project’s Progress Here.
Additional Recommended Reading
Department of Energy awards funding for Phase II of carbon capture study for Gentleman Station, NPPD News Release
It will be beneficial for NPPD customer-owners to have access to data on the costs of fossil fuels and carbon capture versus renewables or renewables+storage.