US 'Tres Amigas' SuperStation to bolster renewable energy capacity with gas-fired power
Chris Hodrien
US 'Tres Amigas' SuperStation to bolster renewable energy capacity with gas-fired power
Source: Tres Amigas, LLC and Foundation Fuel, LLC
Tres Amigas, LLC
(Tres Amigas) and Foundation Fuel, LLC (Foundation Fuel) announced that they
have entered into an Agreement to jointly develop technical and operational
strategies to firm renewable energy sources by deploying clean,gas-fired
power as a back-up.
Coordinated via market-based dispatch through the Tres
Amigas SuperStation, the goal is to create firm and reliable renewable
power from intermittent solar
and wind resources. Most significantly, the new strategy will allow customers to
purchase a reliable portfolio of power with the largest possible component of
solar and wind power.
Economic dispatch of renewables, such as wind
and solar energy, is not easy to achieve without the capability to move power to
load centers. In order to do so, high-voltage power lines must be in place or
constructed, which have very high fixed costs. In order to achieve economies of
scale, the capacity factors of wind and solar generating facilities must be
increased. Strategic deployment of gas-fired capacity provides a solution.
Natural gas is now a relatively plentiful fuel source and this advantage,
combined with the inherent operating flexibility of gas-fired generation, makes
gas the fuel of choice to back up intermittent renewable generation. In fact,
the Permian Basin, located near the Tres Amigas SuperStation, is one of the
largest gas resources in the nation.
Under the terms of the
Agreement, Foundation Fuel will construct natural-gas-fired turbine generation
facilities, along with the pipeline, gas storage and electric transmission
facilities needed to connect the generation to natural gas supplies and to
deliver electric energy directly to the Tres Amigas SuperStation. Power will
then be dispatched via the SuperStation, which electrically will interconnect
all three U.S. power grids. Tres Amigas and Foundation Fuel will coordinate the
construction and integration of these new resources with the power dispatch
capabilities necessary to provide firm and spot-market opportunities for
renewable energy in all three of the U.S. interconnected electrical grids.
Further, the combined assets of both company’s projects will provide important
ancillary and balancing services to the transmission lines carrying power and
energy to a variety of different markets across the country.
Tres
Amigas and Foundation Fuel will also develop pro-forma contracts that will
streamline power transactions for renewable energy providers, power “firming”
entities, and customers. The goal is to enable utilities and other purchasers of
renewable power to contract directly from one source on a long-term basis for
the cleanest available firm power, while also greatly improving the economics of
such transactions. In connection with this, Tres Amigas has previously entered
into a Commercial Operations Agreement with Viridity Energy, Inc. under which
Viridity will design, build and operate the power trading platform for Tres
Amigas that will further enhance economic opportunities for both investors and
consumers of renewable energy. Tres Amigas and Foundation Fuel plan to
coordinate construction schedules such that the new capabilities are available
when the Tres Amigas SuperStation opens in
2014.