The Facts About Replacing
by Steve Crow
In his March 20 commentary in The Oregonian, Steven Hawley gets his facts wrong about the Northwest Power and Conservation Council's Sixth Northwest Power Plan.
Hawley wrote that the output of "a few dams on the Snake River" could be replaced "without replacing the lost power with new generating plants." This he attributes to "the agency responsible for recommending power plans and fish-recovery measures to the BPA." That agency is the Northwest Power and Conservation Council, and it has never made such an assertion.
By law, the council develops a power plan that is implemented by the Bonneville Power Administration. The council revises the plan every five years, each time looking 20 years into the future. Our conclusion in the Sixth Northwest Power Plan (February 2010) is that 85 percent of the new demand for electricity over the next 20 years could be met with investments in improving energy-use efficiency. But this assumes that the four federal dams on the lower Snake River remain in place, continuing to provide clean, low-cost hydropower to the Northwest.
To replace the lost output of the four dams, our analysis indicates that regional output of existing power plants fired by natural gas and coal would have to increase, and that new natural gas-fired generation would be needed along with more energy efficiency. Carbon emissions would increase by 3 million tons per year, a 7.6 percent increase compared to current hydropower operations.
Finally, dam removal also would increase the cost of the power system, according to our analysis. Because the dams primarily serve BPA customers, they would bear the majority of the increased cost -- potentially a 24 to 29 percent increase in the rate BPA currently charges its utility customers.
The council's analysis of Snake River dam removal is in Chapter 10 of the Sixth Northwest Power plan, which is posted on the council's website at www.nwcouncil.org.
Myths and Facts about Lower Snake River Dam Removal Save Our Wild Salmon, Pamphlet, June 2009
Breaching Dam Myths by Ed Whitelaw, Oregon Quarterly, Autumn 2000
Transportation Impacts Of Dam Breaching by Aaron Ellis, Port of Portland, 2/23/00
Grain Transportation After Partial Removal by Dr. Edward Dickey, American Rivers, 9/99
Economic Impact of Restored Fishery by Don Reading, Economic Report, 7/99
Excerpt from: Chapter 10 of the Sixth Northwest Power plan
VALUE OF THE HYDROELECTRIC SYSTEM
The Pacific Northwest power system emits about half the carbon dioxide per kilowatt-hour of the nation or the rest of the western states. This is due to the large role played by the hydroelectric system of the region. To illustrate the value of the hydroelectric system, a scenario was run to examine the effects of removing the lower Snake River dams on power system costs and carbon emissions. The results of the scenario, however, could apply to other changes that reduce the capability of the hydroelectric system for any reason.
The lower Snake River dams provide 1,110 average megawatts of energy under average water conditions, about 5 percent of regional annual electric energy needs. In addition, the dams provide 3,500 megawatts of short-term capacity, a little more than 10 percent of the total hydroelectric system capacity, and as part of the Automated Generation Control (AGC) System, they provide system reserves to maintain the reliability of the power supply. They also provide reactive support for the stability of the transmission system.
The effects of removing the capability of the lower Snake River dams are mainly determined by the replacement resources that would be required for the power system to duplicate the energy, capacity, real-time load following, stability reserves and reactive support currently provided by the dams. To examine the effects on energy and capacity, the generating capability of the dams was removed from the carbon-risk scenario of the Sixth Power Plan. For this scenario, it was assumed that the power produced by the dams was removed in 2020 and the energy and capacity were replaced by other resources selected by the regional portfolio model. That is, given the reduced energy and capacity of the hydroelectric system a low-cost and low-risk portfolio of new and replacement resources is developed. The changes in cost, carbon emissions, risk, and average retail electricity rates are shown in Table 10-3. The effects analyzed include the replacement resources for the assumed loss to the power system of only the energy and capacity of the Snake River dams. No estimate was made of the cost of replacing the other services provided by the dams. There are many other implications and costs of dam removal including the cost of removing the dams, future operating cost and replacement savings, substitution of other transportation modes for barge transportation (including fish transportation), changes in irrigation sources, and other factors. These were addressed most completely in the Corps of Engineers EIS on the Lower Snake River Juvenile Salmon Migration Feasibility Study,3 and have not been included in this analysis.
Dam removal increases the carbon emissions, cost, and risk of the power system. The projected changes to the power system to accommodate the loss of hydroelectric capability are not a simple energy and capacity replacement. Small increases in conservation and renewable resources occur in this scenario, but the primary replacement of the dams is provided by changes in the construction of new gas-fired generating plants, changes in the operation of existing and new generating plants, and changes in net exports. Existing natural gas-fired and coal-fired generation is used more intensively. In addition, the region exports less energy and imports more. The combination of these changes makes up for the lost 1,100 average megawatts of energy. Table 10-4 summarizes the average replacement resources; however, the average hides a wide variation in responses depending on the future that is encountered.
Replacement of the lower Snake River dam energy and capacity results in increased carbon emissions of 3.0 million tons year, a 7.6 percent increase compared to emissions in the carbon- risk scenario. To place this number in context, it is an amount five times greater than the amount of carbon saved by renewable portfolio standards between the carbon-risk and the no-RPS scenarios. Increased carbon emissions result because without the dams the resource strategy includes more options of additional new gas-fired generation and builds the options more frequently. In addition, existing carbon-producing resources are dispatched more often. In total, Table 10-4 shows that 1,103 average megawatts would be required to replace the dams with 437 average megawatts coming from carbon-producing resources, not including increased imports that would also most likely come from carbon-producing resources
The changes in net present value system cost shown in Table 10-3, while appropriate for regional electricity planning comparisons, hide significant changes in costs and their allocation over time and among utilities and consumers in the region. Figure 10-18 shows the annual pattern of cost changes for the dam-removal scenario. Annual cost of the power system increases in 2020 by over $530 million and remains higher. Further, because the lower Snake River dams serve Bonneville public-utility customers, those utilities and their consumers would bear the cost increases. Using a rate-making rule of thumb that a $65 million to $80 million cost increase translates into a $1 per megawatt-hour increase in Bonneville rates, a $530 million increase in Bonneville costs would raise rates by between $6.60 and $8.15 per megawatt-hour. Based on Bonneville's priority firm rate of $28 per megawatt-hour, dam removal causes an increase of 24 percent to 29 percent.
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