Two projects aim to give Reliant big power boost

By MICHAEL DAVIS

August 25, 2000 Web posted at: 10:52 AM EDT (1452 GMT)

HOUSTON, Texas (The Houston Chronicle) -- Reliant Energy has struck a deal that will lead to the construction in West Texas of the world's largest wind power project, the Houston energy company said Thursday.

The company also announced that it will begin drawing methane from the state's landfills to use as fuel for power generation, a growing trend at landfills across the country.

Texas utilities such as Reliant are adding an increasing amount of generating capacity using renewable energy sources, such as wind. In part, this change is driven by the law passed last year to deregulate the state's electricity markets. Under the law (Senate Bill 7), Texas must add 2,000 megawatts of new generating capacity from renewable energy sources such as wind and solar power by Jan. 1, 2009.

"We need to be moving in this direction because of SB 7 but we also need to meet customer needs for that segment that wants green power," said Joe Bob Perkins, president of Reliant Energy's wholesale group. "SB 7 just greased the skids."

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Pat Wood, chairman of the Public Utility Commission of Texas, recently said Texas will easily achieve the requirements of the law, which opens Texas to competition and customer choice in 2002.

The two Reliant projects will add about 250 megawatts of new renewable power to the state -- the equivalent of a small power plant.

That's still tiny compared to the South Texas Project nuclear plant with 10 times the capacity.

While environmentalists have long pushed renewable power sources as a clean alterative to plants fired by fossil fuels, they've historically looked like an uneconomical option for electric companies.

But with natural gas prices up to record levels, that's changing, said Tom "Smitty" Smith with Public Citizen in Austin.

"With the recent runup in natural gas prices, wind power is now slightly cheaper," Smith said. "And as more turbines are added, the price of wind power will continue to plummet."

There are already requests filed with state regulators for access to the state's power grid from renewable energy projects totaling 2,600 megawatts, Smith said.

Electricity produced by the two Reliant projects will be sold into the state's power grid, to rural electric cooperatives, and to other retail energy providers after the state's energy markets are opened up. The company estimated they will generate enough power to serve 80,000 households.

Reliant estimates its wind power project will have the result of removing about 1,000 tons of nitrogen oxide emissions from the state's atmosphere because it will displace power that would have been generated using fossil fuels.

Reliant Energy, parent of Reliant Energy HL&P and Entex, said it will form a new company named Reliant Energy Renewables to handle the two new projects.

The wind power project, which will cost $120 million to build, will be the largest single installation of its kind in the world measured by generating capacity. It will be located on 3,141-foot King Mountain, near McCamey, in Upton County in West Texas, about 70 miles south of Odessa.

The wind power project will produce electricity from about 160 wind turbine generators, each capable of generating 1.3 megawatts.

Construction is scheduled to begin this fall.

Austin-based Cielo Wind Power and Renewable Energy Systems will develop, build and operate the King Mountain Wind Ranch under a contract with Reliant. The contract from Reliant Energy to buy the electricity from Cielo Wind Power and Renewable Energy Systems will ensure Cielo has the income needed to finance the project.

The project will expand HL&P's small amount of wind power sold already. The company currently obtains 22 megawatts of electricity from a wind generation project in Culberson County.

Reliant Energy's landfill gas-to-electricity project, which will extract methane gas that occurs naturally in landfills as organic materials rot, will produce 44 megawatts of power.

The methane will be collected from shallow wells that will be drilled into landfills. The gas will then enter a closed pipeline system connecting to reciprocating engines. The methane will fuel the engines, which, in turn, will generate electricity, said Jeff Ferguson, director of special projects for Reliant Energy wholesale group.

The methane gas-to-electricity generation project will involve 12 landfill sites in Texas owned by Houston-based Waste Management.

Plans call for Reliant Energy to begin purchasing electricity from both projects by the fourth quarter of next year.

Installation of the wells in the landfills will occur in the first quarter of next year.

Landfills included in the project are the Atascocita landfill at Humble and the Blue Bonnet landfill in Houston. Others are located at Alvin, Security, Conroe, New Braunfels, Hutto, Temple, Waco, Sherman, Kingston, and Fort Worth.

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