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Friday, July 09, 2010

Envirnment - "Hoosier consumers are likely to pay bulk of $16B for lines to transport wind power"

So reports Ted Evanoff in the Indianapolis Star today. The lengthy story begins:

The rural Midwest is booming with wind turbines these days -- but guess who's going to pay the $16 billion it will cost to move all that clean electricity to the cities that need it?

Officials are trying to figure out how much wind developers should pay to build the transmission lines to get their energy to market. But because other regions have shifted the entire cost to utility rate payers, the Midwest officials likely will feel pressure to do the same.

If they don't, industry analysts say, it could hurt the development of green energy in the region.

The Midwest -- with its heavy reliance on coal-fired power plants -- can ill-afford that, as federal regulations clamp down on carbon emissions.

Over the next few years, the development of wind energy could cost Indiana households more than $40 million per year, adding at least $2 per month on average to the typical bill for the state's 1.5 million homes.

The new cash would help pay for about $16 billion worth of new transmission lines that wind developers say are needed. The lines would move wind energy into the electric grid -- the interlaced power lines that tie utilities into a massive network.

Paying for the new lines raises an issue of fairness because households in, say, Indianapolis could subsidize electricity made by North Dakota wind turbines and used in cities such as Milwaukee, Chicago or Fort Wayne, experts say.

That could happen because the electric grid that covers Indiana is monitored by a Carmel-based nonprofit organization whose territory includes a wide swath from Ohio to the Dakotas.

More from the story:
"Within 25 years, we expect wind will be 16 percent" of our power, said John Bear, president of the Midwest Independent Transmission System Operator.

Bear's group, known as Midwest ISO or MISO, is largely funded by utilities. It is scheduled to present its transmission cost allocation plan to the federal regulators Thursday. The regulatory commission will rule on the plan in determining transmission cost allocation for the 13 states in MISO's district.

Wind farm operators had feared MISO would stick to its long-held proposal of having power generators pay for 20 percent of the cost for building the transmission lines from the wind farms to the grid. Consumers, including homes and businesses, in the 13 states would have paid 80 percent.

Last month, however, MISO changed course. It tentatively proposed consumers handle the full 100 percent.

Posted by Marcia Oddi on July 9, 2010 12:20 PM
Posted to Environment