Dive Brief:
- Two American Electric Power (AEP) subsidiaries have requested regulatory authorization to purchase three wind power projects totaling 1,485 MW, now under development in Oklahoma.
- Public Service Co. of Oklahoma (PSO) and Southwestern Electric Power Co. (SWEPCO) want to spend $2 billion on the wind projects, to serve customers in Arkansas, Louisiana, Oklahoma and Texas. The subsidiaries made filings with regulators in multiple states on Monday.
- The projects are being developed by Invenergy and were selected following AEP's request for proposals. The utilities say the renewable energy will save customers approximately $3 billion, net of cost, over 30 years.
Dive Insight:
AEP will need approval from regulators in all four states where the new wind generation will serve customers, as well as sign-off from the Federal Energy Regulatory Commission. But to bolster its case, the company said it can scale the amount of generation acquired by PSO or SWEPCO, subject to commercial limitations, "to align with individual state resource needs as determined by the respective state commissions."
The trio of wind projects, all in Oklahoma, include a 999-MW facility being built north of Weatherford, a 287-MW facility being built southwest of Enid, and a 199-MW project being built south of Alva.
The smallest project is expected to be completed by the end of 2020, and the other two by the end of 2021. AEP said the projects would provide more than 5.7 million MWh annually.
"Purchasing these wind facilities is consistent with our strategy of investing in the energy resources of the future," AEP President, Chairman and CEO Nicholas Akins said in a statement. The company recently added 724 MW of wind and battery generation to its contracted competitive portfolio, and proposed adding more than 9,100 MW of new wind and solar generation and nearly 2,300 MW of new natural gas generation to its regulated power plant fleet by 2030.
As proposed, SWEPCO would own 810 MW of wind generation, approximately 55% of the projects, with PSO owning the remainder.
The coal-heavy utility's long-term strategy calls for more than a third of its energy deliveries to come from wind and solar, over the next 20 years. SWEPCO said it now serves customers with 469 MW of wind energy through power purchase agreements.
“Our long-range plan moves SWEPCO toward a cleaner energy future with more low-cost, renewable energy as part of our diverse energy mix,” utility President and COO Malcolm Smoak said in a statement.
SWEPCO sees coal-fueled generation dropping from 83% to 44% of the company’s resource mix, as wind energy increases from 9% to 26%, and solar is introduced and grows to 10%. Gas-fired generation will grow from 7% to 19% of the utility's energy mix.
Oklahoma wind power currently makes up approximately 20% of the energy PSO delivers to its customers. The company said its long-term plan shows customers "will benefit from additional wind energy beginning in 2022." The utility's plan also includes increased gas-fired and solar generation resources over the next ten years.
