The Wind-Powered City

There are a pair of energy-related stories in the news here in Chicago today. First, duh City is planning on putting two wind turbines on top of the Daley Center:

Wind power is coming soon to the Windy City.

But don’t look for propellers mounted on poles. Chicago’s wind machines will be thrust up into the breeze on the shoulders of its buildings.

This spring, planners said Monday, two wind turbines will be mounted on the Daley Center, and eight more on a Helmut Jahn-designed building on the Near North Side.

Plans to place turbines on the Museum of Contemporary Art for its “Massive Change” exhibit, opening in September, are in the discussion stage.

The projects will provide answers about how practical and affordable wind power can be here, said Sadhu Johnston, the city’s environment commissioner. Some day, turbines could be on top of commercial and residential buildings all over Chicago, he said.

His department is putting together an “urban wind map” to see what areas of the city have the most potential.

The two turbines on the Daley Center will supply only a small portion of the building’s energy needs. Together they will produce enough power for four households.

“We’re monitoring the equipment,” Johnston said. “As soon as that’s done and the weather breaks, we’ll be up there.”

I didn’t know that any aldermen had a brother-in-law who owned a company that produced wind turbines. 😉

Actually, I think this is an interesting experiment and wind turbines placed on top of skyscrapers probably won’t run into the NIMBY issues that large wind farms frequently do. And it’s a lot more appropriate for Chicago than solar power would be (as anyone who’s ever walked in the Loop in wintertime will attest to).

In the other energy-related story of the day, the Illinois Commerce Commission has approved a power auction system for Commonwealth Edison:

The Illinois Commerce Commission today approved a controversial auction as the way consumers will get electricity in 2007. At the same time, the commission warned that electricity rates are bound to rise.

“Let’s be clear: electricity prices are going up,” said Commissioner Robert Lieberman.

However, Commonwealth Edison, which backed the auction, reiterated a pledge to limit rate increases for the first three years the auctions are held. The company says prices will be no higher during that time than they were in 1995.

The Citizens Utility Board, which opposed the auction along with Illinois Atty. Gen. Lisa Madigan, said it will take the decision to court in an effort to overturn it.

“It’s a terrible decision,” said David Kolata, executive director of CUB. “We are going to do everything we can to stop it.”

State law allows for appeals courts to overturn ICC decisions, although that is rare.

The issue of power procurement dates to the 1990s, when state legislators envisioned a competitive environment for electricity.

The theory was that if the state deregulated its electric utility industry, competitors would offer residential consumers bargains, just as deregulation of telephone service led to competition and lower phone bills.

While competition did arise for big commercial and industrial electricity customers, none appeared for residential customers. CUB and others said that was because no one could offer electricity cheaper than ComEd.

ComEd no longer owns generating capacity, although its corporate parent, Exelon, operates a large fleet of nuclear power plants which supply the state with much of its electricity. ComEd sold its coal-fired plants after the state began deregulating the electric industry.

To create what it terms a competitive market, ComEd last year proposed a kind of auction to buy electricity from bidders, including Exelon. Critics said the deal would enrich Exelon at consumers’ expense.

The utility proposed a reverse auction in which participants would offer progressively cheaper and smaller bids until the region’s requirements for power were met. It was expected that each bidder would offer energy from multiple sources such as coal, nuclear, natural gas and perhaps wind.

Such a method is used in New Jersey. The auction was scheduled for the coming September to determine electricity rates beginning in 2007.

Bidders would know one another’s offers, the auction would be conducted by an independent third party and representatives of the ICC would be on hand to monitor events.

As part of deregulation, residential electricity rates were reduced 20 percent and frozen nine years ago. ComEd and other utilities have warned for months that electricity prices would almost certainly jump sharply beginning next year.

The price of coal and natural gas has soared in the interim. On the other hand, Exelon has become highly efficient in operating its nuclear plants and the cost of electricity from that source has fallen sharply.

Gov. Rod Blagojevich, facing a potential consumer revolt in an election year, responded by threatening to fire any commissioner who voted for the auction.

ComEd then offered to cap residential electric rate increases to 8 percent in 2007, 7 percent the following year and 6 percent in 2009.

“We would keep rates at or below (what they were in) 1995 through 2009,” said ComEd spokeswoman Judy Rader. Critics had numerous concerns about the details of the auction.

For example, Exelon is not permitted to offer all of its cheap nuclear power in the auction.

That meant it could sell power to a third party, perhaps a Wall Street financial firm, which could mark up the price and bid in the auction. Consumers would pay more for electricity in this scenario.

The idea of the auction has been under study for months at the ICC.

I’m going to have to admit I don’t understand the intricacies of ComEd’s strategy. Chicagoans already pay more for electricity than most places in the country while the ComEd plants have among the lowest costs of production in the country. I’ve always suspected (without any particular proof) that ComEd spun its energy-generating component off so they could sell their cheap power at a profit to other areas of the country and simultaneously create artificial scarcity here in Illinois to justify their rates. Perhaps some clever person could explain it all to me.

But the bottom line looks to me as though we’re going to spend a lot more on electricity.

0 comments… add one

Leave a Comment