Avista delays wind farm

An economy in recession means less demand for electricity and less need for new renewables at this time, according to Avista Corp. (NYSE: AVA).

The Spokane, Wash.-based utility confirmed in late November 2008 that it will delay construction of a planned 50-megawatt (MW) wind farm five miles south of Reardan, Wash., that it purchased the rights to in May. Instead of starting construction on the $125 million project in 2009 as had been planned, the utility is pushing construction back to 2012 and now expects to bring it online in 2013.

Hugh Imhof, a spokesman for the investor-owned utility, notes that the company’s most recent Integrated Resource Plan was released in 2007 and forecast 2.3 percent annual demand growth. He says that he expects that number to drop, but the company is still revising its numbers.
 
“We estimate that with the economy as it is, we won’t have quite as much demand in the next two years,” Imhof says. “Other renewables will be suitable. We don’t need the power for the next two years.”

Instead of the Reardan wind farm, Avista says it plans to invest $48 million on a project to retrofit turbines on the utility's Noxon Rapids Dam on the Clark Fork River. When completed, the project would add about 28 MW to the utility’s portfolio, which can be counted toward Avista’s requirements under Washington’s renewable portfolio standard (RPS).

Imhof insists that the utility's recent decision is not the end of the road for wind power projects in Avista’s portfolio; rather, it's just a pause before the storm. Over the next 10 years, he says the utility plans to add about 300 MW of wind to its portfolio. The utility also plans try to press the Washington state legislature to modify the terms of the RPS so it can include all of its small hydro facilities and a biomass plant the company brought online in the mid 1980s. Currently, the RPS defines acceptable renewables as new projects that came online after 1999.