Drought stresses West Coast power grids

Sponsored by

Low lake levels and below-average water runoff in the Western U.S. is sapping the region's hydropower generation capacity, which could lead West Coast utilities to lean more heavily upon their coal- and gas-fired power plants.

At the same time, the California Independent System Operator asked its customers to conserve power February 7 due to a shortage of natural gas, which is being used to help warm customers during cold weather in the area.

Reduced water supply in the Pacific Northwest will impact the hydropower generation capacity in the area, according to a report from the U.S. Energy Information Administration, a branch of the Department of Energy.

The Northwest River Forecast Center released its first water supply projection of 2014 for the Pacific Northwest and indicated a below-normal runoff for a majority of the observation stations in the region compared to the 30-year average.

The region has the largest concentration of hydroelectric capacity in the country, and reduced generation not only affects the immediate area, but also neighboring regions, including California, that import hydropower from the Pacific Northwest, according to the EIA.

Some public power agencies in California could be financially pressured in 2014 by the drought's impact on hydropower production, according to Fitch Ratings.

While the financial impact is expected to be manageable, utilities with a greater reliance on hydroelectric generation may be forced to use more expensive power generation and purchased power to replace the potential shortfall in hydropower output for the third year in a row.

Eight of the 14 Fitch-rated public power issuers receive from 10 percent to 32 percent of their power supply from hydroelectric resources according to a Fitch report.

The fuel mix for in-state electricity generation in California has generally shifted away from lower cost hydropower toward natural gas-fired resources during below-average water years. In 2011 hydropower accounted for an above-average 21.3 percent of in-state electricity generation.

Washington, Oregon, Idaho and Montana host 35 percent of U.S. hydropower capacity, and the supply can have implications for the dispatch of other sources of generation and greatly influence regional wholesale power prices, according to the EIA.

“Absent an abundant supply of hydroelectric output, wholesale power prices may be increasingly determined by the cost of natural gas generation in the region,” according to the report.

In 2012 hydropower production decreased to just 13.8 percent under drier conditions. This corresponded with an increase in natural gas-fired generation, which rose from 45.4 percent in 2011 to 61.1 percent in 2012. Figures are not yet available for 2013; however, the contribution from hydropower is expected to remain relatively low based on observed water levels.

Public power utilities in California have experienced prolonged periods of dry water conditions before the current cycle and have undertaken measures to reduce their vulnerability. These include improved rate design, the broader use of automatic recovery mechanisms, the collection and use of rate stabilization funds, and more conservative budgeting.

Although sufficient time remains for water conditions to return to more normal levels in 2014, which has occurred in about half of water years that experienced dry first quarters according to California Department of Water Resources, the state is currently experiencing record low water conditions, with almost one-third of the water year (Oct. 1-Sept. 30) passed.

Sponsored by
CURRENT ARTICLES

Utilities not marketing service offerings effectively to Gen Y customers

05/21/2015

According to the study, Gen Y is inclined to take control of their energy usage    

Siemens to service at Brooklyn Navy Yard cogeneration power plant

05/21/2015

The agreement also includes the plant’s SPPA-T3000 control system, SGEN6-1000A generators and SST-800 steam turbines

Pepco Energy wins energy efficiency contract with U.S. Army Corps of Engineers

05/21/2015 The IDIQ has $1.5 billion in capacity for task orders under a base ordering period of five years with one additional five-...

ON DEMAND WEBCASTS

Solar + Storage: Capturing Opportunities and Overcoming Challenges

The convergence of solar and energy storage applications is under way. The combined application o...

Storage Enters the Global Stage: What’s the value proposition for your region?

For electricity storage, the events of the last two years have shown that the skepticism around t...

Beyond Integration: Three Dynamics Reshaping Renewables and the Grid

In a unique industry research initiative, DNV GL gathered views from over 1,600 energy sector par...

Engaging the Small and Mid-sized Business (SMB) Marketplace

This session will outline how Duke Energy leveraged Voice of Customer insights, previous experien...

When Grid Optimization is Not Enough: Making Cents of Disruptive Change.

Electric utilities today face unprecedented volatility and business challenges. To stay competiti...

INDUSTRY STOCKS

EL&P BUYER'S GUIDE PRODUCTS

Nuclear Horizontal Modular Storage (NUHOMS®)

AREVA TN’s NRC-licensed NUHOMS® system ensures the highest safety and lowest dose performance. With no tipping, tripping and sliding, you have the...

Cavitation Peening

AREVA developed its innovative solution for asset management, significantly extending the life of reactor components. Cavitation Peening is a perma...

Decontamination & Decommissioning

Decommissioning strategy development, cost estimates, plant modifications; system and building decontamination; RV segmentation; large component re...

AREVA’s Stearns Roger® Services

AREVA can assess, upgrade or replace Manipulator Cranes, Spent Fuel Bridges and Fuel Transfer Systems to ensure total reliability and optimal perfo...

POWERGRID PRODUCT LISTINGS

EtherMate® Industrial Ethernet - IO Modules

LioN-M ProfiNet device with 16 digital I/O channels, channels can be used universally as inputs or outputs, M12 socket, ro...

Low-Smoke Zero Halogen Premise Distribution Cable

AFL’s Low-Smoke Zero Halogen (LSZH) distribution cable offers all of the benefits of a traditional 900 µm based optical ca...

OFL280 FlexTester - Handheld OTDR

AFL's OFL280 FlexTester offers an unmatched combination of fiber test functions, ease-of-use, portability, and value.

TRM® 2.0 - Test Results Manager PC Analysis and Reporting

Test Results Manager 2.0 (TRM® 2.0) is an all-in-one analysis, viewer and reporting tool designed for use with NOYES fiber...

FEATURED ENERGY JOBS

View more Job Listings >>

POWERGRID International

March 2015
Volume 20, Issue 3
1503PG-cover

ELECTRIC LIGHT & POWER

January 2015
Volume 93, Issue 1
1501elp-cover