Rise of wind alters traditional view of baseload energy
Ten years ago, the Midwest energy market included 1,000 megawatts of wind generation. Today, there are 15,000 megawatts – and more development is expected.
As wind turbines have filled in the countryside, forecasting and control technologies have improved, transforming the once-disruptive technology into one of the market’s driving forces.
“In the past, we tended to think of our coal resources as baseload and every other resource being supplemental to that,” said Great River Energy President and CEO David Saggau. “I would suggest to you that wind is quickly becoming the new baseload. To be viable going forward, all other sources must be flexible enough to be supplemental to the wind.”
Great River Energy’s largest power plant, Coal Creek Station, has adapted to market forces through operational and engineering modifications. The plant is now able to significantly adjust its output in response to market signals – a rare and increasingly valuable trait for a large plant.
“Our ability to respond to variations in wind output will become a major determinant of our success in the energy market,” added Saggau.
Opportunities and challenges
Great River Energy recently announced plans for an additional 300 megawatts of cost-effective wind energy, which will bring its total renewable energy capacity to more than 1,000 megawatts in 2021, including 200 megawatts of hydropower. The purchase will put Great River Energy on track to meet Minnesota’s renewable energy standard requiring utilities to generate 25 percent of electricity from renewable resources by 2025.
The increase in wind energy has also prompted difficult decisions. Great River Energy will retire its Stanton Station power plant because it is no longer economical to operate in an energy market flush with fuel-free wind energy. The use of low-cost natural gas as a generation fuel also has reduced the economic viability of some coal plants.
“The predominance of wind power is especially pronounced in the northern region of the Midwest energy market,” said Great River Energy Vice President and Chief Market Officer Jon Brekke. “This is where the effects of wind power are felt the most and where the benefit of flexibility might be most readily shown.”
Great River Energy serves its members with a diverse power-supply portfolio, enabling the company to respond to changing market and weather conditions.