Minnesota Utility Sees Declining Returns in Coal Power Generation


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Great River Energy wind transition reflects a market shift as wind power and natural gas undercut coal at Coal Creek Station in North Dakota within MISO, boosting renewable energy integration and flexible, marginal-cost operations.

 

Key Points

A shift from coal to flexible wind and natural gas in MISO, lowering costs and improving reliability.

✅ Coal Creek output cut during high wind seasons

✅ MISO pricing shifts dispatch to wind and gas

✅ New 300 MW wind PPA with NextEra from 2019

 

Minnesota’s second biggest utility, Great River Energy, has begun to significantly ramp down the output of its largest coal plant as the market has shifted to wind power and natural gas production.

The generation and transmission utility’s Coal Creek Station, located 50 miles north of Bismarck, North Dakota, can produce 1,100 megawatts (MWs) of electricity. That makes it the largest power plant in North Dakota and by far the biggest in Great River Energy’s system.

Currently, though, the plant operates at less than a third of its full output in times of high wind production – spring and fall – as the cost of having it operate at full capacity costs the company money. Some days the plant produces less than 300 MW.

“In the old days we used to want to turn on our coal plants and leave them at full output and fill in with other resources,” according to Great River Energy vice president and chief generation officer Rick Lancaster.

“Things have reversed now. Wind power and natural gas are running at the top and coal is filling in when the wind is not blowing and demand is high – that’s when we have to ramp up our coal plant.”

Great River Energy – which provides electricity to 28 cooperatives serving 1.7 million customers – remains highly dependent on fossil fuel plants, primarily coal for baseline generation and natural gas for peaking plants. But wind has increasingly become an investment of choice.

The company announced this week that it will buy electricity starting in 2019 from NextEra Energy Resources LLC’s new 300 MW wind project slated for construction in south-central North Dakota.

Currently, the utility has 469 MW of production coming from wind farms in North Dakota, Minnesota and Iowa. Solar production is up to 3 MW collectively from many different sites. The company also has a waste-to-energy plant.

Great River Energy produces 17 percent of its energy from renewable energy and is on track to meet the state’s requirement to produce 25 percent of annual electric sales by 2025.

Therese LaCanne, corporate communications manager, said the utility also plans to close the coal-fired Stanton Station in North Dakota by May and end a long term contract with Dairyland Power Cooperative to purchase electricity from the coal-fired Genoa plant, similar to Alberta’s move to retire coal power by 2023.

Perhaps the biggest change in the market has come from wind power, a trend mirrored in German renewables as well. Midcontinent Independent System Operator, Inc. (MISO) has seen wind power increase from 1,000 MW in 2006 to 15,000 MW by the end of 2015, Lancaster said, and 2016’s additions will just add to the total.

Natural gas plants producing electricity continue to garner larger market share. The U.S. Energy Information Administration just reported coal production continues an eight year decline, falling 15 percent in 2016, even as a new U.S. coal plant has opened in a unique case.

The EIA summarized the market data: “Low natural gas prices, warmer-than-normal temperatures during the 2015-16 winter that reduced electricity demand, the retirements of some coal-fired generators, and lower international coal demand have contributed to declining U.S. coal production.”

Great River Energy has four peaking plants but those operate mainly in high demand times, especially in summer, he said. The fracking industry has definitely changed the equation and made natural gas, once prone to big swings in price, more competitive, Lancaster said.

Great River Energy produces power for the MISO market and then buys electricity from the agency’s power pool. That’s how the market has been structured for more than a decade.

The price of electricity during windier seasons such as fall and spring send a “price signal” to utilities that can make coal power production uneconomical, he said, and in Alberta the power price cap has come under scrutiny as generators switch to gas.

“We know what the variable cost of each of our plants is,” Lancaster said. MISO’s “locational marginal pricing” for electricity for the next day may lead to a curtailment in Coal Creek’s output because producing the power would be too costly, Lancaster said.

In winter the plants may run closer to capacity as some natural gas production shifts to heating. In summer, when the wind is weaker, the plants also run closer to capacity, said Lancaster, although solar has a growing ability to absorb some of that demand.

Great River might run a plant at minimal load to avoid having to turn it off during the night or to serve an area considered to be in a “load pocket,” Lancaster said. That’s utility speak for sections of the grid lacking transmission capacity.

The flexible approach has basically “redefined the mission of our plants” from producing as much energy as possible to nimbly responding to market demands, he added.

Coal could decrease even more once breakthroughs are made for wind and solar storage, he predicted. “The real key in our industry in the future is storage,” he said.

“That’s where there’s a gap. We don’t have good ways of storing electricity – batteries are inefficient, expensive and they tend to wear out. The industry needs a breakthrough in storage technology. Until we get that we’re continue to rely on coal and other fossil fuel plants to provide energy when we need it.”

Although Great River Energy has to comply with Minnesota’s renewable energy standard, and is on track to do so, Lancaster did not highlight greenhouse gas reduction as much of a driver. Yet the convergence of market forces has led to greener power.

The switch to wind “is driven by economics but will make complying with the Clean Power Plan easier,” he said. The Clean Power Plan’s status, however, remains unclear.

Matt Prorok, policy associate at the Great Plains Institute, explained that marginal costs include the price of running a plant in addition to fuel costs. Natural gas has been cheaper than coal for the last couple of years.

Despite that situation, Prorok said in the MISO market coal-based plants produce 45 percent of  the region’s power, followed by natural gas (22.5 percent), nuclear (16.5 percent) and wind (10.7 percent). Coal was nearly 60 percent just two years ago.

“There are projections for continued growth for wind power and natural gas, which will remain a low cost fuel for the foreseeable future,” Lancaster said. “It’s tough times for coal.”

 

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New York Just Greenlighted The Country’s Biggest Offshore Wind Farm Yet

New York Offshore Wind advances as South Fork Wind Farm by Deepwater Wind gains LIPA approval near Long Island, delivering 90-megawatt clean power with offshore turbines, supporting renewable energy goals, jobs, and climate action.

 

Key Points

New York Offshore Wind includes South Fork Wind Farm powering Long Island and advancing state renewable energy goals.

✅ LIPA approves 90 MW South Fork Wind Farm construction

✅ Deepwater Wind to build 15 offshore turbines near Montauk

✅ Supports NY 2030 renewable targets and coastal grid reliability

 

The company behind the first offshore wind farm in North America won approval Wednesday from New York state to build the country’s biggest seaward turbines yet, as U.S. offshore wind power is about to soar nationwide.

The Long Island Power Authority, a state-run utility company, gave Deepwater Wind the green light to begin construction on the South Fork Wind Farm, a 90-megawatt, 15-turbine development 30 miles southeast of Montauk, amid more South Shore turbine proposals from local planners.

“New York leads the nation in pioneering clean energy innovation, and this bold action marks the next step in our unprecedented commitment to offshore wind, as well as our ambitious long term energy goal of supplying half of all electricity from renewable sources by 2030,” New York Gov. Andrew Cuomo (D) said in a statement. “This project will not only provide a new, reliable source of clean energy, but will also create high-paying jobs, continue our efforts to combat climate change and help preserve our environment for current and future generations of New Yorkers.”

The move comes as the nascent U.S. offshore wind industry finally begins to gain steam. In November, Deepwater Wind completed construction on the Block Island Wind Farm, the five-turbine, 30-megawatt project that became the country’s first commercial wind farm located in the water. Last month, Statoil, Norway’s state-owned oil and gas giant, won a $42.5 million bid to lease 79,350 acres of federal waters located 14 miles off Long Island’s southwest coast, through a process overseen by BOEM officials and regulators. It’s unclear how many turbines would go up, but the company plans to build a wind farm producing at least 600 megawatts.

Winds off the coast of the U.S. are so reliably strong, turbines built offshore could generate 4,223 gigawatts of power ― four times the amount of electricity that’s currently produced from all sources in the country, according to a 2012 study by the National Renewable Energy Laboratory. Yet, even as the offshore wind industry boomed in Europe, tapping that resource has proved difficult, and questions remain about when the U.S. will reach 1 GW of offshore wind on the grid at scale. Wind turbines remain expensive. Electricity produced mostly by natural gas and coal continues to be cheap, relative to prices in other countries. Developers must navigate a Byzantine web of state and federal regulations before gaining approval to build turbines offshore.

Despite his pledge to eliminate up to 75 percent of federal regulations, newly sworn-in President Donald Trump could complicate things for the industry. He filled his Cabinet with climate science deniers and fossil fuel executives explicitly bent on boosting the oil, gas and coal sectors by slashing environmental rules that favor zero-emissions energy sources. He has a history of battling the wind industry, describing land-based turbines as a death trap for eagles and restarting a yearslong feud over an offshore project underway that obstructs the view at his golf course in Scotland. 

Under Cuomo’s plan for New York to get half of its electricity from renewable sources by 2030, as New York investigates offshore wind sites, offshore wind provides 2,400 megawatts ― enough to power 1.25 million homes, according to state estimates. 

“It’s massive, how much energy is out there,” Catherine Bowes, senior manager for climate and energy at the National Wildlife Federation, told The Huffington Post on Wednesday. She added that her nonprofit planned to work with Deepwater Wind to ensure that migrating whales, fish and other sea creatures would not be hurt by the construction of the windmills. “It is a game-changing scale of the amount of clean energy out there right where we need it, right along the big coastal zone from Boston down to Washington, D.C.,” she said.

 

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Global Wind Energy To Shift Southward In Years To Come

Climate Change Effects on Global Wind Power include shifting wind resources, altered temperature gradients, and regional hotspots, with declines in Northern Hemisphere mid-latitudes and gains across the Southern Hemisphere and tropics, according to climate models.

 

Key Points

Shifting temperature gradients cut wind potential in the north and boost resources across southern and tropical regions.

✅ Northern mid-latitude winds weaken under high emissions

✅ Southern and tropical hotspots strengthen over oceans

✅ Planning must adapt as models show regional uncertainty

 

In the next century, wind resources may decrease in many regions of the Northern Hemisphere and could sharply increase in some hotspot regions down south, according to a study by University of Colorado Boulder researchers. The first-of-its-kind study predicting how global wind power may shift with climate change appears today in Nature Geoscience.

'There's been a lot of research looking at the potential climate impact of energy production transformations-like shifting away from fossil fuels toward renewables,' said lead author Kris Karnauskas, CIRES Fellow and Assistant Professor in Atmospheric and Oceanic Sciences (ATOC) at CU Boulder. 'But not as much focuses on the impact of climate change on energy production by weather-dependent renewables, like wind energy.'

Wind powers only about 3.7 percent of worldwide energy consumption today, but global wind power capacity is increasing rapidly-about 20 percent a year, and long-term analyses like the BNEF 2050 outlook point to major growth ahead. Karnauskas and colleagues Julie Lundquist and Lei Zhang, also in ATOC, wanted to better understand likely shifts in production, so they turned to an international set of climate model outputs to assess changes in wind energy resources across the globe. The team then used a 'power curve' from the wind energy industry to convert predictions of global winds, density and temperature into an estimate of wind energy production potential.

While not all of the climate models agreed on what the future will bring, substantial changes may be in store, especially a prominent asymmetry in wind power potential across the globe. If carbon dioxide emissions continue at high levels, wind power resources may decrease in the Northern Hemisphere's mid-latitudes, and increase in the Southern Hemisphere and tropics by 2100.

Strangely, the team also found that if emission levels are mitigated, dropping lower in coming decades, they see only a reduction of wind power in the north-it may not be countered with an increase of power in the south.

Renewable energy decision makers typically plan and install wind farms in areas with consistently strong winds today. For example, the prairies of the American Midwest-persistently windy today and in recent decades-are dotted with tens of thousands of turbines. While the new assessment finds wind power production in these regions over the next twenty years will be similar to that of today, it could drop by the end of the century.

By contrast, potential wind energy production in northeastern Australia could see dramatic increases.

Potential global wind power in coming years. Top images represent next 40 years, bottom images represent next 80 years. Left images represent lower emissions, right images represent higher emissions scenario. Red areas are wind power hotspots, blue areas are reductions. White areas are uncertain. Image: Kris Karnauskas/CIRES

There were different reasons for the Northern decline and the Southern increase in wind power potential in the high-emissions scenario, Karnauskas and his co-authors found in their analysis of modeling results. In the Northern Hemisphere, warmer temperatures at the North Pole weaken the temperature difference between this cold region and the warm equator. A smaller temperature gradient means slower winds in the northern mid-latitudes.

'These decreases in North America occur primarily during the winter season, when those temperature gradients should be strong and drive strong winds,' said Associate Professor Lundquist, who is also a RASEI Fellow. In addition to North America, the team identified possible wind power reductions in Japan, Mongolia and the Mediterranean by the end of the century. This may be bad news for the Japanese, who are rapidly accelerating their wind power development, with growth despite COVID-19 observed in recent years.

In the Southern Hemisphere, where there is more ocean than land, a different kind of gradient increases: land warms faster than the surrounding, much-larger oceans. That intensified gradient increases the winds. Hotspots for likely wind power increases include: Brazil, West Africa, where hydropower support could complement wind growth, South Africa and Australia.

'Europe is a big question mark,' added Karnauskas. 'We have no idea what we'll see there. That's almost scary, given that Europe is producing a lot of wind energy already, with offshore wind market poised to become a $1 trillion business in the coming decades.' The trend in this region (and in others, like the southeastern United States) is just too uncertain: some models forecast wind power increase, and others, a decrease.

In a warming world, harnessing more wind power in coming decades could be critical for countries trying to meet emission reduction standards set by the Paris Climate Agreement, even as Africa may not go green this decade, highlighting regional challenges. The team's results may help inform decision-makers across the globe determining where to deploy this technology.

'The climate models are too uncertain about what will happen in highly productive wind energy regions, like Europe, the Central United States, and Inner Mongolia,' said Lundquist. 'We need to use different tools to try to forecast the future-this global study gives us a roadmap for where we should focus next with higher-resolution tools.'

 

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Electricity production from Irish windfarms hits all-time high

Ireland Wind Power Exports drive record renewable electricity, with onshore and offshore wind capacity surging, SEAI report finds, cutting fossil fuel imports and CO2 emissions and boosted by Corrib gas field and windier conditions.

 

Key Points

Electricity exports enabled by record onshore and offshore wind in Ireland, reducing fossil fuel imports.

✅ Wind capacity rose to 2,827 MW, boosting electricity generation

✅ Renewables met 27% of gross electricity consumption in 2016

✅ CO2 cuts of 3.1 Mt and lower fossil fuel import spend

 

Ireland became an exporter of electricity last year on the back of record production from onshore and offshore windfarms, in line with a record year for renewables globally in 2016, and this year’s production could be even higher, a new report shows.

And the country’s spending on imported fossil fuels fell by €1.2 billion last year following the opening of the often-controversial Corrib gas field off the Mayo coast.

A report from Sustainable Energy Authority of Ireland (SEAI), due to be published on Tuesday, highlights major changes in where Ireland’s energy comes from, as renewables surpassed fossil fuels in Europe for the first time, and how it is now being consumed.

Ireland produced its largest amount of renewable electricity ever last year, reflecting leadership in integrating renewables onto the grid, on the back of the introduction of an additional 400 megawatts of power from wind turbines.

This brought the total capacity of Ireland’s wind turbines, on land and at sea, to 2,827 megawatts, amid rising European wind investments across the region, according to the SEAI’s annual Energy in Ireland Report. It includes analysis going back to 1990.

Most of the turbines that entered service last year did so towards the end of last year, so this year’s figures should be higher again, the report says. In addition, the more windy conditions seen this year will also boost production.

Renewable electricity generation accounted for more than 27 per cent of gross electricity consumption in 2016, with over one-third green within four years expected nationally, while the use of renewables in electricity generation reduced CO2 emissions by 3.1 million tonnes and avoided €192 million of fossil fuel imports.

 

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