March 15, 2007

Global Monitor (March 2007)

Winter storms ravage Nebraska grid

No state in the U.S. was slammed harder by this winter's weather than Nebraska. Storm after storm swept across the Cornhusker State, devastating the transmission system of Nebraska Public Power District (NPPD), reducing generation from NPPD's largest power plant (the 1,365-MW coal-fired Gerald Gentleman Station), and making line repair difficult and dangerous.

 

A huge ice storm at the end of December knocked out 824 miles of NPPD's 4,000-mile transmission and distribution grid. About 160 miles will have to be rebuilt from the ground up (Figure 1).

 

 

"The storm basically cut our statewide transmission system in half," said Ron Asche, CEO of NPPD. "That damage is visible to anyone driving past the downed power lines. What many don't realize is that we also had to reduce [generation] at our largest power plant. We have had to replace that power by running higher-cost plants and buying electricity on the spot market. This may add millions of dollars to our operating costs for 2007."

As temperatures rose after the ice storm and service restoration crews began to assess the damage and get power flowing again (Figure 2), Nebraska was struck by a windstorm with gusts topping 50 mph. Crews worked through the dangerous conditions to restore power as quickly as they could, and much—but not all—of the statewide power system was working again within about a week.

 

 

NPPD estimates it will pay $40 million for replacement power from the date of the storm through May of this year. The wholesale generation, transmission, and distribution utility guesses that another $140 million will be needed to repair the damage to its electrical system. NPPD's reconstruction manager, Barry Campbell, said, "In reality, we are building from the ground up in some places." He described the situation as "a larger-than-life jigsaw puzzle we need to put back together before summer."

On January 7, President Bush declared scores of Nebraska counties federal disaster areas, making public power distribution utilities in them, and NPPD, eligible for federal aid. NPPD said it expects to cover the transmission reconstruction costs not covered by the federal assistance by issuing long-term debt, over a 20- to 30-year period.

But the cost consequences of cutting generation at Gerald Gentleman Station, which supplies about half of NPPD's power, may require the utility to consider a rate increase. "The sooner we can start generating more power at Gerald Gentleman Station and transmitting it over the rebuilt lines, the better it will be for our customers," said Asche. "But no utility can rebuild more than 160 miles of transmission lines overnight, and it is too early to determine what impact [the rise in] our operational costs will have on us overall."

Images and video of the storm damage are posted on NPPD's web site (www.nppd.com).
 

Waste-fired plant coming to Arizona

A power project capable of converting forest or paper waste into as much as 24 MW of electricity is well under way in eastern Arizona.

The Snowflake White Mountain Power plant has been designed to burn woody waste material from any of three sources—thinning of surrounding National Forests, small trees burned in the 2002 Rodeo-Chediski wildfire (the largest in state history), and waste from nearby sawmills. It also will burn waste from a nearby paper mill that produces 250 tons of waste paper fibers daily and sends them to a nearby landfill. Soon, the paper waste will instead be sent through a series of presses to lower its moisture content and then to the power plant's boilers.

The plant is expected to be commissioned late this year, when it will begin supplying Salt River Project (SRP) and Arizona Public Service (APS) under long-term power-purchase agreements. The $53 million project is being developed by NZ Legacy LLC, a private company that began life in 1866 with a state charter to develop a railroad line. The Snowflake project, in the town of the same name, was the winning bidder in a 2004 SRP request for proposals for 10 MW of biomass power.

Scott Higginson, executive VP of NZ Legacy, told the Associated Press, "This project is about environmental protection and creating electricity in an environmentally safe and renewable fashion." According to Higginson, SRP has committed to buy 10 MW for 15 years, and 20 MW in each of the final five years of its 20-year contract. APS is buying 10 MW for 15 years.

NZ Legacy said that the plant will be powered by a Babcock & Wilcox bubbling fluidized-bed boiler (Figure 3) that has been specifically designed to accommodate the waste fuel specs. The developer explained that the plant's reuse of components (including conveyors and screw presses) from an idled paper facility in Houston will improve its economics.

 

 

Another economic plus, said NZ Legacy, is the new plant's ability to share the paper mill's 40-MW substation. Only 3 to 4 MW of its capacity are now being used, and the substation's interconnections, relays, and switches are all less than four years old. An interconnection with APS is already in place. Furthermore, natural gas is already available for start-up needs, and the paper mill has both a state-of-the-art control room and monitoring equipment and company-owned rail service and trucking contracts for fuel handling.

The Snowflake plant has caused some concern for environmentalists. The AP quoted a local Sierra Club officer as expressing doubts. "We certainly wouldn't want to see Arizona put all its eggs in the biomass basket," said Sandy Bahr. "I don't think that biomass plants are really a good energy solution per se because clearly there are still issues with emissions."
 

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