Generation RFPs from Portland Utility Draw Huge Response

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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Consultants for Portland General Electric Company (NYSE:POR) (Portland, Oregon) are working their way through an avalanche of responses to two recent requests for proposals (RFPs) that the utility issued for electric generation. One RFP was for renewable energy, while the other sought energy and capacity from more traditional forms of fossil-fueled generation. The company plans to select winning bids for both RFPs in the coming weeks and months. Given the amount of megawatts (MW) proposed compared to PGE's requests, the utility should be able to negotiate favorable terms with project developers. Names and bid details were not released.

In late November, Portland General Electric (PGE) announced it had received 64 bids representing 39 separate renewable generating projects. In total, about 4,450 MW of renewable projects were proposed. The utility had sought 100 MW. It wants the new renewable resources to become available over 2013-17.

"We're still early in the process, but we have seen a strong response" to both the RFP for renewable energy and an earlier RFP for energy and capacity," Steve Corson, a PGE spokesman, told Industrial Info in an interview.

"A growing percentage of the electricity we deliver to our customers comes from renewable resources," Jim Lobdell, PGE's vice president for power operations and resource strategy, said in an October statement announcing the renewable energy RFP. "This RFP will be an important step in meeting the state's renewable power goals and, together with our separate RFP for baseload and capacity resources, will help solidify our ability to continue providing reliable, affordable power to our customers for years to come."

The new renewable generation is needed to meet Oregon's renewable energy standard, which mandates that renewable energy account for 25% of a large utility's electricity supply by 2025. Right now, renewables reportedly account for about 11% of PGE's electricity portfolio. As an interim milestone, PGE is required to have 15% of its electricity come from renewables by 2015. New renewable generation contracted for through this RFP will help the utility meet the 15% interim requirement.

Wind projects accounted for the "substantial majority" of bids received, PGE said on November 26, but it also received proposals for geothermal, biomass, biogas, hydro and solar generators. The bids received include a mix of projects to be sold to PGE pursuant to asset purchase agreements and projects that would sell power to the utility under long-term power purchase agreements.

"We were interested in getting bids for all types of renewable generation, providing the technology was commercially available," Corson said. Each bid will be evaluated on its own merits, with no specific weighting for different types of renewable technology, he added.

The bids are being assessed by Accion Group Incorporated (Concord, New Hampshire), an independent evaluator selected by the Oregon Public Utility Commission to assure an objective and impartial process. One of the renewable projects was proposed by PGE.

Accion also is evaluating bids received under an earlier PGE RFP for capacity and energy. That request, too, was significantly over-subscribed. In that RFP, PGE requested proposals for:

• 300-500 MW of baseload resources
• 200 MW of year-round flexible and peaking resources
• 200 MW of bi-seasonal (winter and summer) peaking supply
• 150 MW of winter-only peaking supply

PGE said it received 32 bids representing 15 different generating projects for energy and capacity totaling:

• 5,826 MW of base-load generation
• 1,651 MW of flexible capacity resources
• 1,627 MW of seasonal peaking resources

In the RFP for capacity and energy, Corson said PGE did not specify fuel types, but did specify generating technologies. For the capacity portion of the earlier RFP, PGE sought:

• Simple-cycle combustion turbines (aero-derivatives only)
• Reciprocating engines
• Pumped-hydro storage
• Hydro-based generation with pond capability
• Compressed air energy storage with simple-cycle combustion turbines

For the energy portion of the earlier RFP, PGE specified new, high-efficiency natural gas combined-cycle generation, the spokesman said. The utility wants the flexible and peaking resources to be available in the 2013 to 2015 timeframe, and the base-load energy resources in the 2015 to 2017 timeframe.

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