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One report meets Minnesota utility’s state, Federal requirements

Moorhead residents turned out to celebrate the commissioning of Zephyr, the first of the city's two wind turbines. Under Minnesota law, a utility can invest up to five percent of its mandated load management budget in renewable energy. (Photo courtesy of Moorhead Public Service)

Integrated resource planning by any other name is still a useful tool for forecasting energy demands, so in 2000, Western revised its IRP guidelines to give customers like Moorhead, Minn., Public Service the option of submitting its biannual, state-required Conservation Improvement Plan in lieu of an IRP.

Since 1991, the Minnesota Public Utilities Commission has required investor-owned electric utilities to spend 1.5 percent of gross operating revenues on conservation, energy efficiency and load management. The rule included publicly owned utilities, too. “We take the CIP very seriously because the measures are good not only for customers and the environment but for business, too,” said Moorhead Energy Services Coordinator Kevin Bengtson.

Focus on conservation a valid approach to wise use
Under updated IRP guidelines, the CIP qualifies as a minimum investment report. Western customers required by state, tribal or Federal law to invest a mandated minimum in demand side management may substitute the MIR for an IRP. “The MIR/CIP option for Moorhead does an excellent job of dealing with the conservation issues of resource planning,” said John Pankratz, Western’s Upper Great Plains Energy Services manager.

The most current version of the CIP stipulates that utilities spend 65 percent of the funding pool on load management. That figure will drop to 50 percent in 2005, noted Bengtson, because, “Utilities should be doing load management anyway.”

Moorhead addresses this requirement with a dual-fuel, space heating program. Customers who install electric heating systems can receive a rebate for adding a backup system to use during peak generating hours.

The rest of the funding is earmarked for direct impact energy efficiency—programs that show energy savings. A popular lighting replacement program has been very successful for helping the utility to meet this requirement. Customers receive rebates to offset the cost of replacing conventional light bulbs with CFLs and phasing out T12 fluorescent fixtures with electromagnetic ballasts in favor of T8 lights with electronic ballasts.

Installing LED lighting in place of incandescent bulbs in exit signs is a big source of energy savings, too, said Bengtson. “If you replace a 30-watt incandescent bulb with LED technology, consumption drops to two to three watts, and those things are on 24-7,” he noted.

CIP line item boosts wind program funding
Renewable energy is a line item in the CIP’s load management portion. A utility can invest up to five percent of those funds on renewable technology. Moorhead Public Service used that provision to help add wind power to its portfolio. “Our CIP budget helped us to cover the marketing and operating costs of the wind turbines, such as maintenance and insurance,” explained Bengtson.

The wildly successful “Capture the Wind” program launched in 1999 with “Zephyr,” the first of two 750-kW turbines, 425 subscribers and a waiting list. The second turbine, named “Freedom” by program members, went online in December 2001.

Moorhead substitutes wind generation for coal power, which makes up about 35 percent of its mix. Combining the cost of the wind with its Western hydropower rate, the utility is able to offer members a non-polluting product for an additional 0.5 cents per kilowatt. The low cost is undoubtedly a part of “Capture the Wind’s” customer appeal. The National Renewable Energy Laboratory ranks the green power program’s customer participation rate as the third highest in the country.

That may be putting the cart before the horse, observed Bengtson, since customer demand was one of the driving forces behind the decision to develop wind. “A lot of our customers come from farms with windmills driving water pumps. They knew we had the local wind resource and they wanted to use it,” he explained. “We’re also a very family-oriented community and people feel strongly about protecting the environment for their kids.”

Planning requirements encourage program evaluation
The state requires utilities to prepare a CIP every two years, while Western only requires an IRP every five years. Bengtson believes that the frequent exercise helps keep Moorhead’s conservation and renewable energy programs on track. “We would be doing these programs anyway, but we probably wouldn’t be looking at the results in as much depth without the CIP,” he admitted.

Whether it is called an IRP, an MIR or a CIP, mandated planning makes utilities follow through on in-depth evaluation, which improves future as well as current programs. “If we see, for instance, that our load is 55 percent commercial and 45 percent residential, maybe we need to adjust our conservation spending to reflect that,” he said. “It helps us make sure that we are using our customers’ money wisely.”

And since planning is the key to efficient use of resources—money, energy, electricity—Western supports it by any name.