Once gusting upward, prices for wind power have calmed recently, and that price trend has caught the attention of Spokane-based Avista Corp. as it remains mindful of the state's renewable energy requirements.

In addition, however, the trend is causing a re-evaluation of some renewable resource projects in the Northwest.

Industry representatives say the price of wind-produced power has declined during the last few years because the market demand for electricity has dropped since the onset of the recession. The cost to construct a wind-turbine farm also has decreased due to that and various other market conditions, such as lower costs of materials and labor, they say.

Avista Utilities Vice President of Energy Resources Dick Storro says the utility company recently issued a request for proposals for renewable energy sources because prices for wind energy have dropped between 25 percent and 30 percent in the last year and a half.

Avista had issued a similar RFP in the fall of 2009, but Storro says the company decided not to pursue any of the proposals it received then due to the high cost of wind energy at that time, which was projected to be around $100 per megawatt-hour (MWh). That figure was for the base energy price and also included transmission and other related costs, he says. One megawatt is enough to power about 750 homes.

In its more recent request, issued in February, Avista said it would accept proposals of no more than $62 per MWh. That amount doesn't include additional transmission and integration costs that were included in the 2009 price. The delivery period for the contracts secured as a result of the RFP would be between 2012 and 2032, the document says.

Storro declines to disclose details about the responses Avista received to the RFP until it decides on how it wants to proceed, and that isn't expected to occur until later this spring or in early summer. He says, though, that only one proposal didn't involve wind power, and that one was from a solar energy producer.

A Washington initiative that was passed by voters in 2006, called the Energy Independence Act, requires utility companies in the state to acquire a percentage of their total energy load from renewable sources, or buy renewable energy credits to meet that overall percentage. The mandate says that by 2020, 15 percent of a utility's total power load must come from renewable energy sources. It also includes a gradual increase which requires that by 2012, 3 percent of utilities' loads must be from renewable sources, and in 2016 that requirement goes up to 9 percent.

Storro says that Avista already is on track to meet the 3 percent target for next year by purchasing renewable energy credits and by making upgrades to two of its dams, Noxon Rapids Dam, in Noxon, Mont., and Cabinet Gorge Dam, in Clark Fork, Idaho.

Additional hydroelectric power produced as a result of those upgrades is considered an acceptable renewable resource to meet the state's requirements, he says.

Any contracts that come out of Avista's February RFP will go toward meeting the 9 percent requirement due in 2016, he says.

Storro says that while Avista didn't sign a contract with any of the wind-energy developers that submitted bids in 2009, it's kept in contact with them. He says that's partly how Avista learned of the recent dip in prices for wind energy and wind turbines. A drop in prices for steel, concrete, and labor also has influenced the wind industry, he adds.

"All those things had softened, and for the most part that was a result of supply and demand," he says. "There wasn't a lot being built at the time, and my understanding is that one of the biggest factors is that turbine prices themselves have changed. That is what caused us to put out the RFP" in February.

Rachel Shimshak, executive director of Portland, Ore.-based Renewable Northwest Project, a nonprofit renewable energy advocacy group, agrees that a decline in the demand for electricity as a whole has caused prices for wind energy and other renewable resources to drop.

"When there's a dip in the economy like what we've experienced over the last couple years, people use less electricity and the demand goes down, so we have a lot of supply and not much demand," Shimshak says.

She adds that wind energy now is comparable in price to natural gas-produced power. She says that while the initial investment to construct a wind farm is much greater than building a natural-gas plant, the long-term cost to operate a wind facility is much less and is more predictable for utility companies and their customers. The reason, she says, is that wind essentially is free, but the cost of natural gas can fluctuate greatly depending on market conditions.

In Washington state, there currently are 19 commercial wind projects that are operating, and most of them are located in the Columbia River Gorge, Renewable Northwest Project's website says. It also shows that five new wind farms are under construction in the state.

The nearest wind farm to the Spokane-Coeur d'Alene area that's now being built is in Garfield County, in southeastern Washington. Puget Sound Energy is the developer of that project, called the Lower Snake River Wind Project, which will have an estimated generating capacity of 343 MW with a total of 149 wind turbines. The first group of wind turbines is expected to begin operating next year, PSE's website says.

In addition to those currently under construction, there also are about 10 wind energy projects across Washington that now are in the permitting process, Renewable Projects Northwest says. One of those is Avista's Twin Buttes Wind Project, to be located near Reardan, Wash., 24 miles west of Spokane.

Another is what's being called the Palouse Wind Project, to be located seven miles west of Oakesdale, Wash. The developer of that project is Boston-based First Wind LLC, which said last fall that it plans to erect about 50 turbines in wheat fields on a ridge about a mile east of U.S. 195. The project's capacity would be about 100 MW, and the developer said it hopes to begin construction late this year or early next year after it has secured a conditional-use permit from Whitman County.

Storro says Avista's Twin Buttes project still is being studied, and that at this time Avista hasn't set a construction start date. Avista has said the project would include between 25 and 35 wind turbines and have a generating capacity of 50 MW.

He adds that Avista has set up meteorological towers on two pieces of land north and south of the Reardan site to gather data on wind speeds, wind direction, and other weather-related data. The Twin Buttes project would be the first wind energy facility that Avista would own and operate, he says.

"We're still in the study mode with Reardan, and hopefully at some point we'll use that project to meet our need" for renewable energy requirements, Storro says.

Washington ranks fifth in the U.S. in overall power capacity from installed wind energy projects, according to American Wind Energy Association (AWEA) statistics. The state currently has about 2,100 MW of wind-produced energy on the grid, which is enough to power 575,000 homes. Close to 200 MW of wind-generation projects were completed last year, and an additional 595 MW are under construction at this time, the AWEA says.

To support the state's rapid growth in wind projects, Bonneville Power Administration, the Portland, Ore.-based nonprofit federal utility that operates a high-voltage transmission grid across Washington, Oregon, Idaho, and Montana, says it's exploring measures to deal with that increase in wind-produced energy to its system.

BPA spokesman Doug Johnson says, "Down the road, one of the challenges is building transmission for high-wind yield places where you can then send it to load centers and use it."

Recently, BPA surpassed 3,000 MW of wind-generated energy on its transmission grid, and the power provider expects to have between 5,000 and 6,000 MW connected to it by 2013, which is far ahead of past estimates, he says.

Johnson adds that BPA recently has received several requests for new energy transmission lines to connect new wind farms in Washington to its grid. Right now, he says, it's putting up a line near Walla Walla, Wash.

"We are in the process of reinforcing the transmission system to handle all kinds of energy," he says. "One of the challenges that the wind industry across the country is facing is that where most of the wind blows, there's not a lot of development."

Most of the wind farms in the Columbia Gorge—the BPA estimates about 2,100 turbines now are operating there—are connected to its transmission lines, which send the power generated there mainly to cities in Western Washington.