Creativity, Curtailment, and Conveyance: Innovations and C - PowerPoint Presentation

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Creativity, Curtailment, and Conveyance: Innovations and Challenges Facing Today’s U.S. Wind Industry

ByKimberly E. DiamondFeb. 22, 2016Symposium: The Growing Importance of Renewable Energy and Distributed Generation: Legal, Political, and Technological PerspectivesABA RADER Committee and Columbia Law School’s Environmental Law Society

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Drinker Biddle & Reath LLPSlide2

Innovations and Trends from AWEA Fall Symposium

2Dawn Over the Sandía Mountains by the Rio Grande - Photo courtesy of Kim DiamondDiamondSlide3

Where Will New Development Be?

3“Apple Tree Clip Art Black and Whitle,” image courtesy of: http://clubecandoca.com.br/images/apple-tree-clipart-black-and-white-i19.jpg

Low-Hanging Fruit – Gone!

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Wind Resources in the U.S.

4Best Wind Resource = Dark BlueMedium Wind Resource = Blue

Poor Wind Resource =

White

NREL Wind Energy Resource Atlas of the United States, Map 2-1: United States Annual Average Wind Power, located at

http

://

rredc.nrel.gov/wind/pubs/atlas/maps/chap2/2-01m.html

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Future Focus: The Southeast

Wind resources are not optimal in the South5NREL Wind Energy Resource Atlas of the United States, Map 3-34: Geographic map of the Southeast Region, located at http://rredc.nrel.gov/wind/pubs/atlas/maps/chap3/3-34m.html●

The National Renewable

Energy

Laboratory’s

(“

NREL’s”)

Wind

Energy Resource Atlas

ranks

wind power

availability:

•

Class

1

= Lowest

•

Class

7

= Highest.

●

NREL’s Southeast Region state maps indicate the wind generally blows at a Class 1 level throughout the following states: • Mississippi • Alabama • Georgia • Florida • South Carolina**(Exception: Class 2, 3, and 4 in very small upper NW corner)

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Wind Speed and Wind Power

Wind Speed – The rate at which wind flows past a point above the Earth’s surface. The higher the altitude, the faster the wind speed.Wind Power – The energy available in the wind, measured as a function of the cube (third power) of the wind speedExample: Wind speed of 10 mph =

10 x 10 x 10 = 1,000

Wind speed of 12.6 mph =

12.6 x 12.6 x 12.6 = 2,000

100

% difference in the available

wind power

Slight increase in wind speed =

Big change in power production

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Source: Iowa Energy Center, located at

http://www.iowaenergycenter.org/wind-energy-manual/wind-and-wind-power/wind-speed-and-power

/

Picture courtesy of: http://images.search.yahoo.com/images/view;_ylt=A0PDoX1FNBdRdxMAc4KJzbkF;_ylu=X3oDMTBlMTQ4cGxyBHNlYwNzcgRzbGsDaW1n?back=http%3A%2F%2Fimages.search.yahoo.com%2Fsearch%2Fimages%3Fp%3Dwind%2Bturbine%26n%3D30%26ei%3Dutf-8%26y%3DSearch%26fr%3Dyfp-t-701%26tab%3Dorganic%26ri%3D223&w=1050&h=697&imgurl=terrachoice.com%2Fwp-content%2Fuploads%2F2008%2F11%2Fwindpower.jpg&rurl=http%3A%2F%2Fterrachoice.com%2F2008%2F11%2F20%2Fnew-energy-for-ecologo-standard%2F&size=360.7+KB&name=TerraChoice+|+Share+|+Blog+|+New+Energy+for+EcoLogo+Standard&p=wind+turbine&oid=ce883b6f6b4549faef4c040cbad7546f&fr2=&fr=yfp-t-701&tt=TerraChoice%2B%257C%2BShare%2B%257C%2BBlog%2B%257C%2BNew%2BEnergy%2Bfor%2BEcoLogo%2BStandard&b=211&ni=190&no=223&ts=&tab=organic&sigr=122ujb5tp&sigb=13i45v8ce&sigi=11oibnj46&.

crumb=STmIqQe91xx

Wind Speed

2 MW

2.3 MW

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Interplay of Innovation, Technology, and Feasibility

Wind energy becomes feasible, depending on how high the turbine heightTall towers can be used to harness wind speeds in low wind speed areasThere is very high interest from AWEA and NREL in developing and deploying this technologyThe economics must work to offset the cost of the taller turbines7Photo courtesy of Wikimedia Commons, located at:

https://commons.wikimedia.org/wiki/File:Washington_Monument_-_Washington,_D.C..

jpg

Height = Approx. 3 MW Turbine

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Tower

Height

Turbine

Height Slide8

Tall Towers, Large Blades, and O&M Concerns

Blade sizes are growing faster than turbine sizesOperation and maintenance factors come into play Updates needed for project viability:CranesConstruction EquipmentSafety EquipmentConsider both items now:Operational ExpenseCapital ExpenseValue vs. Cost for each new turbineLevelized Cost of Energy is keyLong-term performance is key8

Picture

courtesy of Daily Kos, located at

http://www.dailykos.com/storyonly/2010/3/8/844165/-

Offshore-wind-farm-constructionmore-pictures

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Issues Arising with Bigger Turbine Sizes

Transportation Logistics – Innovations Needed55 – 60m bladesType of truck on roadRoute to take – need to avoid:Falling off curvesKnocking into buildings orother items near roadwayProject finance implicationsInstallation and Commissioning

Agreements

Transit Charges

Project Site Access

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Photo courtesy of : http

://blogs.kqed.org/climatewatch/2009/07/31/making-noise-over-wind/

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Evolution of On-Site Construction:

Product Liability Concerns and Risk AllocationSplit blades mean potential for Increased RisksOn-site assembly = Increased opportunities for injuriesProduct liability concernsManufacturing defectsOn-site blade assembly

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Picture courtesy of H&Askham Group

http

://handajointing.co.uk/haskham-win-borkum-west-ii/

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Curtailment: A Wind Industry Issue Confronting Multiple Regions

Curtailment = Forced reduction in a power plant’s energy outputImpacts wind farms and solar farms when there’sOversupply of energy flooding the transmission gridInability to balance effectively Renewable energy being integrated into the grid with Other generation resources More system congestion = More chance for curtailment 11

Photo courtesy of MEIL

http://www.meil.in/power.html

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Regional Examples of Curtailment:

Pacific NorthwestLocation/Region: Pacific NorthwestCase:NRU v. FERC (9th Circuit)Curtailment Caused By:Substantial increase in wind generationAnticipated high water levels in the Columbia River BasinExpected excess hydropower, resulting in an “oversupply event” Amount Curtailed and Duration:5.4% of wind generation between May 18 –June 18, 2011Result:FERC’s rulings are upheldTo foster an “open access” policy, a power regulator under FERC’s jurisdiction must provide transmission services that are “not duly discriminatory or preferential”

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http://www.tripadvisor.com/Attraction_Review-g51795-d288086-Reviews-Bonneville_Lock_Dam-Cascade_Locks_Oregon.html#photos

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Regional Examples of Curtailment:Texas -

ERCOTLocation/Region:Texas – Electric Reliability Council of Texas (ERCOT)Curtailment Caused By:Completion of Transmission Lines in Texas’s Competitive Renewable Energy Zone (CREZ) not coming on line quickly enough to accommodate new wind farmsGrid congestion - Too much wind energy simultaneously coming onlineAmount Curtailed and Duration:Approx. 8% wind in 2008, 2010, and 2011Approx. 17% wind in 2009Result:“Downward Dispatch” not as problematic, due to CREZ transmission lines’ completion in 2014.

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https://images.search.yahoo.com/yhs/search;_ylt=A0LEV7llHslWNREAkU8nnIlQ?p=ercot&fr=yhs-mozilla-001&fr2=piv-web&hspart=mozilla&hsimp=yhs-001

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Regional Examples of Curtailment:

MidwestLocation/Region: MidwestCase:Benton County Wind Farm LLC v. Duke Energy Indiana, Inc. (7th Circuit)Curtailment Caused By:MISO, the regional electric grid operator, changing its rules for purchasing energy in 2013MISO issuing curtailment orders requiring decreased wind farm outputAmount Curtailed:41% of wind generation after MISO rules changedResult:

Remains to be seen

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http://www.rabbihausman.com/2011/05/parashat-emor-uneven-scales-of-justice.html

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Huge Transmission Issue

Lack of sufficient transmission is the biggest long-term barrier for wind energy development.Wind is the renewable energy source with the highest cost of grid integration, relative to other renewables options.15

Photo courtesy of Borderless News and Views, http

://borderlessnewsandviews.com/2013/04/money

/

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If You Build It, Transmission May Not Come

People get excited and start building more wind farms than they should (e.g., without grid connections)Field of Dreams philosophy is inapplicableTo be operational, a project must be able to have transmission/ “plug” into the gridIt doesn’t matter how fast the wind industry is growing or how inexpensive wind power is if a project does not have grid access16

Photo courtesy of Wikipedia

https://

en.wikipedia.org/wiki/File:A_plug.jpg

No grid connection = Bad Investment

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Transmission Build in the South

Project received FERC regulatory approval in May 2014HVDC (high voltage direct current) cable transmission tie between ERCOT in Texas and southeastern states (LA, MS, and AL)Estimated Completion Date: 2019Example: SouthernCross Transmission Line(Pattern Energy Group LP)17

The SouthernCross transmission line will use HVDC to deliver Texas wind energy from ERCOT to users in

Louisiana,

Mississippi, and Alabama.

Photo courtesy of Windpower Engineering & Development

http

://www.windpowerengineering.com/construction/texas-hvdc-line-to-reach-louisiana-and-mississippi/

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Need to Bridge the Gap Between Today’s and Tomorrow’s Energy Mix

Creative solutions are neededNeed to think about how to use existing infrastructure to our advantage, while also building new power lines18https://images.search.yahoo.com/yhs/search;_ylt=A0LEVj2ICspWIkQAWionnIlQ?p=bridge&fr=yhs-mozilla-003&fr2=piv-web&hspart=mozilla&hsimp=yhs-003DiamondToday

TomorrowSlide19

In Summary

Innovations in engineering and technological breakthroughs will move the wind industry forward in the Southeast and elsewhereThe economics need to work for projects with taller towers and larger blades to be feasibleCurtailment and transmission continue to be major obstacles for the wind industry, issues about which the general public should be more awareMore clean energy transmission lines are needed, along with public support and expedited permitting for these projectsWind must be viewed as an industry that will serve as a bridge between our current energy mix and our country’s future energy mix vision19DiamondSlide20

Law Student Opportunities

Across the Wind IndustryTechnological Innovations - Patents, Product Liability LitigationConstruction – Project Finance (contract negotiation), Commercial LitigationPermits – Energy Regulatory, Environmental PermittingGrass Roots Advocacy – Find ways to make your voice heard today, through existing organizations and through your own independent efforts

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Thank You21

Picture courtesy of: http://www.123rf.com/photo_8612055_diamond-jewel-isolated-on-light-blue-background-beautiful-sparkling-diamond-on-a-light-reflective-su.html

(212) 248-3199

Kimberly.Diamond@dbr.com