Bonneville Power Administration operates a balancing act in the Pacific Northwest that sometimes makes it appear that 'if everyone's complaining, then we are getting it about right'. In her second report from the US, Janet Wood finds out how the company is building consensus in operation and planning for the system's future
THE Bonneville Power Administration (BPA), based in the US Pacific Northwest, is not a simple hydro utility able to operate its plants to sell power to the highest bidder. First, it is a non-profit government-owned corporation with specific responsibility to balance the needs of river users and the river itself. Second, as Bill Berry, team leader of the Schedule Planning Group, explains: ‘All our hydro stations are owned and operated by the US Army Corps of Engineers or the Bureau of Reclamation. BPA’s responsibility begins at the switchyard.’
BPA began by selling electricity from the Bonneville dam more than half a century ago; now it markets electricity generated at 31 federal dams on the Columbia river system, along with one nuclear plant. It provides around 45% of the electricity demand in the region, to some 135 public utilities, six investor-owned utilities and large industrial customers. It is required to be a self-funded agency and to provide electricity at cost to its customers.
Robyn MacKay, manager of operations planning, says: ‘After billions of dollars invested in a nuclear power project had to be written off, the northwest power planning council decided BPA would not acquire resources. That is up to the region. BPA’s role is to market the power from federal facilities, although we do have a renewables programme bringing on mainly wind and geothermal capacity.’
McKay explains how the Association’s priorities have changed over the years. ‘Thirty years ago the priorities were flood control and power production, along with navigation which is not a main water user,’ she says. ‘By the 1980s fisheries had become more important and we had to save water, change operating regimes and begin installing bypasses and other facilities. By the 1990s, the endangered species had been listed and we have new requirements, for example when to save water and when to spill it as a fish bypass.
‘The priorities of the dams have changed so that flood control and fishery is most important and power is almost a by-product, especially in summer,’ MacKay adds. ‘We have more and more restrictions, especially on power peaking. Now ramp rates are being diminished. The key is involving all those with an interest at an early stage, and seeking to build consensus.’
Although the system has so many dams, storage is limited. ‘Most of the capacity we use is run of river, Berry says. ‘Our storage capacity is at Grand Coulee, Hungry Horse, Dworshak, Albany Falls and Libby, but of those I would describe the storage at Albany as ‘political’ storage – it’s really for local residents.
‘Dworshak and Libby can prime plants lower down the river but both are preoccupied with fish flows, and Hungry Horse has very limited drainage. Grand Coulee is the biggest and most flexible, and it is used to meet requirements for flood control, recreation, fish migration and so on,’ he continues.
‘The system has one pumped storage facility. Grand Coulee has six pump generators up to Banks Lake, so water can be moved out of Grand Coulee the day before if a need is foreseen.’
How does Berry’s group convert all these requirements into day-to-day operation? ‘We have to move the river water so that the elevation is continuously maintained for navigation and other uses,’ he says. ‘Although we have flexibility within each seven-day period, there are limited opportunities to place power at the maximum value time. My group implements strategy to meet daily and weekly requirements: deciding what is the most economic way of moving that volume of water so we can sell at the highest price and avoid purchases. We have to convert daily and weekly goals into daily operation.’
There is no doubt that pressure on BPA’s system is increasing; demand is growing fast in the region, particularly in the Seattle area where internet companies with ‘server farms’ can have requirements up to 500MW. What is more, the region has an unbalanced supply system, with most load in the west and much of the power supply – from BPA and other suppliers – in the east.
For a hydro utility an added stress is hydrological uncertainty. In a normal dry year the company tries to prepare, Berry says: ‘How do we prepare for a dry year? We play it very conservatively, and take opportunities to store water if we can buy power inexpensively.
‘We try to foresee cold weather in the northwest, and hot weather in the southwest. Then we try to maximise our capacity and fill into the run-of-river projects. We can also buy in advance and capitalise on market uncertainty. But we are a big buyer – what we do affects the market.’
The weather in the southwest – California – is important because the two markets are intimately connected. Winter heating causes peak loads in the northwest, while summer air conditioning drives the peak in the southwest, so the two areas have traditionally been sources of peaking power for each other. This made the 2000-2001 period doubly difficult for BPA, when it had a year of record drought at the same time California was suffering a power crisis.
Robyn MacKay says the need to keep the lights on meant the system’s other priorities suffered. ‘If we need to violate the fish requirements we have to call a power emergency,’ she says, so that river level and spill requirements can be altered to meet the needs of power users. ‘This is usually for isolated events, for example if a transmission line goes down, but last year we were in a power emergency for most of the winter.’
As with any hydro utility, keeping plants operating at their peak capacity is a continuing commitment.
‘The dams on the BPA system average 45 years old, and the 31 stations have 202 rotating shafts. The newest is Bonneville 2, built in 1984,’ says James Clune, but he notes that the company has a particular challenge in uprating and refurbishing the plants. Remember, he says, ‘BPA doesn’t own any of the dams on the system. They are owned by the Bureau and Corps organisations which are funded by government appropriations.’
‘BPA was created in the 1930s, initially to dispose of power from Bonneville dam,’ Clune says. ‘For 60 years, as the system was developed, the Corps and the Bureau received their operating and capital budgets direct from the government, and the treasury would bill BPA. So we didn’t co-ordinate well on asset management because both sets of organisations had different goals. For 60 years we never talked to each other about programme goals.
‘Now to manage the relationship we have negotiated four agreements – on the dams and the hydroelectric capacity with each of the organisations [the Bureau and the Corps] – and the programme is directly funded by BPA, so there is much better alignment.’
Clune is now project manager with the Federal Columbia River Power System (FCRPS), in which the Bureau, Corps and BPA, (along with Energy Northwest, which operates the system’s nuclear plant) work together to develop programmes for managing the system’s physical assets. The Corps and the Bureau ‘still operate the dams and execute the programmes but now we have to talk to each other about budgeting so there is a healthy discussion about what should be done,’ says Clune. ‘In 1998-9 we did the first system-wide component assessment to identify our long term needs. At issue was the reliability of the system. We were beginning to see performance declining and we needed to direct the right resources to make it perform as we wanted.’
The group used five performance indicators:
• Cost of power.
• Material condition.
• Environmental stewardship.
• Safety These were then split into 13 quantifiable performance measures that could be gauged against industry benchmarks. Once the areas of declining performance were identified, ‘We started to ramp up the funding to address these issues,’ Clune says. When comparisons were made, one issue stood out (see diagram above). The forced outage rate, at about 6%, was above the industry average.
There were several reasons for this and Clune describes how they are being addressed. ‘On the electrical side we had generator winding problems that were not getting enough funding from appropriations to be addressed. We don’t have a system-wide programme for dealing with these – we are doing it incrementally. It will be a continuing issue for us. As they have a lifetime of 30-40 years we will be replacing five to seven annually. Our old rotating exciters required high maintenance and we have a replacement programme under way for those. We should be through the entire system in around five years.’
On the hydromechanical side, Clune says they have had some blade failures but for runners, changes will improve efficiency, rather than reliability. ‘We are replacing some of them to increase efficiency, for example at Grand Coulee where 18 units will be replaced over the next ten years,’ he says.
For BPA, the programme is a huge investment. ‘The reliability and efficiency programme will cost around US$1B over 12-13 years,’ according to Clune. ‘Our direct funding for the programme was US$73M in 2000, compared to previous appropriations of US$20-30M, so you can see how we are ramping up the programme.’
The investment is required to meet the programme’s key aims: to restore system reliability to industry standard or better; and to improve FCRPS revenues by US$50M annually.
Investments also had to be made in the group’s own capability. ‘The group had to make a big effort to build its own capacity to deliver this much programme in a year. Most of the work is done by contractors but for us it is about driving the process, so for example we have staffed up at Bonneville, including special executors for the Corps and Bureau specialised in staffing and contracting,’ Clune said.
The group is considering opportunities to uprate in some places. ‘On uprating we don’t have a system-wide comprehensive programme but we want to develop an integrated ten-year plan that will be annually updated. We do already have elements of the plan in place,’ Clune says.
The largest project being planned is modernisation of the McNary dam and hydro station. ‘This is probably a US$20M project,’ Clune says. ‘It is a hydraulic bottleneck. It is 50 years old or so and runs at a high capacity factor. We want to improve the reliability and increase capacity and efficiency. We expect to carry out turbine runner replacements and generator rewinds, and replace the excitation systems, governors and auxiliaries.
Now that funding flows directly between BPA and the plant operators the Association can even consider plant operation. ‘Improving O&M is a delicate matter as it is the Corps and Bureau’s responsibility,’ Clune says, ‘but we can discuss processes, and practices, and talk about benchmarking and performance management.’
With all the new investment and extensive upgrading plans, Clune is adamant that the most important change has been the one that has set up FCRPS. For the first time all the organisations involved are working together to develop a sound future for the system.