Missouri regulators have issued an order supporting a Liberty Utilities -Empire District plan to add 600MW of wind generation capacity, the largest such expansion by an electric power provider in the midwestern US state.
The Public Service Commission (PSC) determined that Empire had presented “credible and persuasive” evidence that adding the wind capacity would generate customer savings of $169m over 20 years and $295m over 30 years, relative to the utility’s present resource plan.
The Customer Savings Plan would also “significantly” reduce financial risk for Empire’s customers, the PSC commissioners found.
“It is the public policy of this state to diversify the energy supply through the support of renewable and alternative energy sources,” PSC said in a statement.
“Empire’s proposed acquisition of 600MW of additional wind generation assets is clearly aligned with the public policy of the commission and this state,” it added.
PSC granted Empire certain accounting and depreciation treatment related to its Customer Savings Plan.
PSC will schedule future proceedings once the utility identifies sites for wind farms, a contractor to build them and tax equity partners to help provide financing. The projects would be eligible for federal production tax credits, according to Empire.
“We are eager to continue working with commissioners as we move toward the successful completion of this initiative,” said David Swain, central region president, Liberty Utilities.
Empire earlier received bids from 10 developers – it did not name them -for projects on 18 sites within the Southwest Power Pool, which operates an electrical grid comprising all or parts of 13 states including a large swath of western Missouri.
It did not award final bids but concluded that “multiple” ones were “viable.”
To date, Liberty, based in Joplin, Missouri, has entered into power purchase agreements for wind and those will expire between 2025 and 2028.
Liberty executives said Empire’s expansion plan makes economic sense for customers. It will generate savings for them given the levelized cost of the future wind power will be significantly lower than the forecast price for other energy in the Southwest Power Pool.
Adding wind generation will also reduce financial risk for customers by mitigating impacts that rising fossil fuel and market prices have on retail electricity rates.
Liberty, an indirect subsidiary of Canada’s Algonquin Power & Utilities, acquired Empire District Electric in January 2017.
Algonquin later sought to win regulatory approvals for a proposed 800MW wind expansion by Empire coupled with closure of a 198MW coal-fired facility.
The plan ran into opposition from certain stakeholders, prompting Algonquin to opt for a “more modest investment” to underpin a 600MW expansion while keeping the coal plant in operation.
PSC support for Empire’s plan is a step forward for the wind industry in Missouri, where it has struggled to gain traction this decade.
On 1 April, Missouri ranked 21 st among states with 959MW installed capacity, despite having far greater wind resource than some of those that rank much higher such as Indiana, New York, Oregon and Washington.
While neighboring states have sometimes provided better incentives for wind development, Missouri has not been especially receptive to transmission projects either to import wind energy or expand domestic output.
Coal fueled 81% of Missouri’s electricity in 2017, a greater percentage than all but two of the nation’s 50 states. Eight of the 10 largest power plants utilize coal which is imported mainly from Wyoming by rail.