August 7-14, 2006

NB Power steps up wind power capacity program

In response to the New Brunswick government's electricity from renewable resources regulation, NB Power is increasing the rate at which it will acquire wind-power-generating capacity. In March 2006, as part of its Energy Action Plan, the province asked NB Power to move more quickly on installing 400 megawatts of wind power. The utility is in the final stage of seeking agreements from private developers to provide 200 megawatts (MW) of wind power in the next three years, accelerating its original wind-project implementation. After an intensive evaluation process, NB Power has selected ten companies to make their final wind proposals by August 28. The ten short-listed companies made 17 proposals under an earlier request for expressions of interest.

The 17 proposals were selected to ensure geographical dispersion of the wind sites and take full advantage of the high-wind areas across the province. One proposal would be located inland, with the others proposed for the Bay of Fundy (three proposals), Tantramar (four proposals), Miramichi Bay (two proposals) and Acadia/Chaleur (seven proposals).

This widespread distribution will increase the overall efficiency of wind generators by enabling NB Power to purchase energy from wind generators in areas experiencing high winds at times when wind in other areas of the province may be too low to generate any electricity. Evaluation of the final proposals will be based on pricing, schedule for development, yearly production and reliability of supply.

After the final proposals are submitted and reviewed, NB Power will finalize power-purchase agreements with the successful bidders. It is expected that this process will be completed in October, with the generation coming online before the end of 2009.

Wind developers will be responsible for the cost of establishing a connection to the transmission system. Wind projects located further from the transmission system will incur greater connection costs. This will increase the energy output costs associated with these projects and may influence the financial viability of some projects.

NB Power is expecting to pay more to have renewable energy available, but feels that wind energy will have negligible impact on rates. As the cost of conventional generation increases, any potential impact of renewable-generation costs on rates will decrease. The utility notes that because wind energy production is variable and dependent on wind speeds, it cannot be available for dispatch on demand and therefore requires backup generation facilities increase or decrease production quickly to meet the demand for electricity.

In addition to its wind initiatives, NB Power is supporting the Department of Energy's tidal power study and is exploring a full range of options to obtain incremental renewable energy to meet provincial targets. Other potential sources include biomass, small hydro, and electricity generated from landfill gas.

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