Study says coal-wind system feasible, though highly dependent on conditions

POWER - 02/19/2004

A study released by Platts Research & Consulting finds that an integrated coal/wind generation system, while not yet commercially demonstrated, "is expected to be both operationally and environmentally feasible."

The study, commissioned by Great Northern Power Development L.P., also finds that the financial feasibility of such a system would "vary on a site-specific basis and will be dependent upon energy market prices, project hurdle rates, wind farm size, wind resource quality and policy support, and transmission access and economics." The report was prepared by Senior Associate Jack Ihle and Senior Consultant Brandon Owens.

"The viability of an integrated coal-wind project will be extremely sensitive to the amount of wind capacity," it says. "Without further study, it is not possible to determine either the maximum or optimal amount of wind-powered generation that can be integrated with a coal-fired power plant."

The report says GNPD has been exploring the possibility of developing a coal plant in the upper Great Plains located adjacent to a wind farm. The coal plant would ramp up or down to respond to wind farm output variations to ensure constant plant output. The study hypothesized a 500-MW coal plant with wind farms ranging from 1 to 100 MW.

With a coal plant ramp rate of 5-15 MW/minute and a 20-60 MW wind farm, the study finds, the combined system output would be as constant as a stand-alone coal plant, with wind providing about 2-5% of energy output. The analysis reports that sulfur dioxide and nitrogen oxide emissions from the plant, with required pollution control equipment, would decrease by 1% for every 13.6 MW of wind capacity.

On the other hand, the system internal rate of return declines by 1% for each 30 MW of additional wind farm capacity. "Even if it is technically feasible to co-dispatch at large wind farm sizes," the report says, "it is not financially feasible if the combined system rate of return is below the equity investor hurdle rate. At high levels of wind capacity, the IRR may erode to unacceptable levels.

"The viability of an integrated coal-wind project will be extremely sensitive to the amount of wind capacity," it says. "Without further study, it is not possible to determine either the maximum or optimal amount of wind-powered generation that can be integrated with a coal-fired power plant."

For more details, see pg 48 of the January/February 2004 issue of Power Magazine.