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NESCAUM GHG Case Study
Exelon Corporation Wind Power Marketing
Section 1 – Executive Summary
In 2001, Exelon Corporation signed four twenty-year power purchase agreements for the
purchase of wind power in Pennsylvania making it the largest wind marketer east of the
Mississippi River. The wind power will be marketed by Exelon Power Team, Exelon’s
wholesale marketing operation.1 The four twenty-year power purchase agreements were
made with the following wind farms:
1.
2.
3.
4.
Somerset Wind Farm outside of Pittsburgh, PA;
Mill Run Wind Farm in Fayette, PA;
Moosic Mountain Wind Farm in Wayne County, PA and
Backbone Wind Farm in West Virginia.
Collectively, the four agreements bring Exelon Power Team’s zero emission wind
portfolio to 151.6 megawatts (MW). This capacity is projected to produce enough
electrical output to power over 58,000 average homes annually or the equivalent of
approximately 411,600 zero emission megawatt hours (MWhs) annually.2
The new Pennsylvania wind farms will feed clean electricity into a multi-state region that
includes Pennsylvania, New Jersey, Delaware, District of Columbia, Maryland, Ohio,
New York, and part of Virginia. The zero emission wind power from these four wind
farms avoid greenhouse gases (GHG) and criteria air pollutants associated with
generating electricity from the resources providing power to the regional Pennsylvania,
New Jersey Maryland (PJM) Power Pool.3
Based upon PJM Power Pool average emission rates, the approximately 411,600 MWhs
generated collectively from the four wind farms avoids approximately 246,000 tons of
CO2, 580 tons of NOx, 1,850 tons of SO2 and 14,000 pounds of mercury emissions
annually. The main areas of uncertainty with the quantification of the emission
reductions are the annual generation of the wind farms and the emission factors used. The
average PJM Power Pool emission rates were used instead of the marginal emission rates
due to data availability. For future project monitoring and reporting actual metered
generation data will be retrospectively evaluated and a more precise PJM Power Pool
emission factor most likely the marginal rate will be calculated based on actual dispatch.
The Exelon Power Team has contracted with Community Energy, Inc. to deliver the new
wind power to customers under the name “New Wind Energy” and also validate the sale
of New Wind Energy Certificates.4 New Wind Energy Certificates are sold in blocks of
1
See the Exelon Power Team web site for additional information at http://www.pwrteam.com/home.asp
An average home is assumed to use 600 kWh per month or approximately 7 MWhs annually. Electric
generation projections are based on an average capacity factor of 31%.
3
For comparison, the current average mix of resources supplying the PJM includes: Coal (47%), Nuclear
(37%), Oil (4%), Natural Gas (9%), Hydro-electric (1%), and Other (2%).
4
CEI was founded in the fall of 1999, with the backing of several environmental and industry leaders, to
develop and market clean, renewable electricity. The founders formed the Company to give electric
2
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100 kilowatt hours (kWh) that cost $2.50 each month, which is equivalent to 2.5 cents per
kWh. Customers choose the amount of wind energy they would like to purchase as part
of their ordinary electric supply. Any purchase of two blocks or more is certified by
Green-e, the non-profit organization which monitors green electricity products.
Exelon Corporation owns any and all of the environmental credits that currently exist or
that may exist under future regulatory schemes resulting from this project as agreed to in
the power purchase agreements with CEI. Other environmental impacts of wind energy
are concerns about siting, including bird mortality and visual and noise impacts. While
bird mortality, due primarily to collisions with turbine blades, is a concern, solutions are
being developed. While avian mortality can be minimized with careful site planning, it
will remain a factor in the growth of wind power capacity. Visual and noise impacts can
also make siting wind turbines difficult. Advancing turbine design is providing less noisy
turbines, but it is also producing taller, larger turbines that will be increasingly visible.
Section 2 - Strategy Summary
In 2001, Exelon’s Power Team signed four twenty-year power purchase agreements for
the purchase of wind power in Pennsylvania making it the largest wind marketer east of
the Mississippi River. The Exelon Power Team contracted with Community Energy, Inc.
to deliver new wind power to customers under the name “New Wind Energy” and also to
validate the sale of New Wind Energy Certificates. See details of the purchased power
contracts in Table 1 below.
Table 1: New Wind Farms in Pennsylvania Making Up Exelon’s Purchase Power Agreements
Size (MW)
Commercial
Operation Date
Wind Farm
Location
Moosic
Mountain
Wind Farm
Wayne County,
PA.
52
Spring 2002
Somerset
Wind Farm
Somerset, PA.
9
October 2001
Mill Run
Wind Farm
Fayette County,
PA.
15.6
October 2001
Backbone
Mountain
Wind Farm
West Virginia
75
December 2002
Annual Output
141,000 MWhrs or enough
electricity annually to supply
approximately
20,000 homes
25,000 MWhrs or enough
electricity annually to supply
approximately 3,400 homes
42,000 MWhrs or enough
electricity annually to supply
approximately 5,700 homes
203,000 MWhrs or enough
electricity annually to supply
approximately 29,000 homes
In displacing a kilowatt-hour (kWh) of electricity generated by fossil-fired units, wind
generation avoids emissions of carbon dioxide (CO2) and many other pollutants. The size
of these reductions depends on the type of generation displaced. What is displaced by
renewable generation depends on many factors, such as the regional generating mix and
the time of day and year. In general, emission reductions are greatest when renewable
customers the best green energy choice in the market - one that adds new renewable electricity to the grid
and delivers the market and public relations advantages of fuel-free, emission-free energy to the customer.
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generation displaces generation at a coal-fired unit, but even when renewables displace a
new gas-fired plant, CO2 reductions and potential criteria pollutant reductions are
substantial.
Section 3 - Source Identification/Location and Contact Name
Exelon Power Team
Purchase Power Contracts
Locations:
Moosic Mountain Wind Farm
Wayne County, PA.
Somerset Wind Farm
Somerset, PA.
Mill Run Wind Farm
Fayette County, PA.
Backbone Mountain
West Virginia
Contacts:
Thomas A. Sylvester
Exelon Power – Environmental Affairs
200 Exelon Way, KSA1-E
Kennett Square, PA 19348
Phone: 610-765-5885
Fax: 610-765-5561
thomas.sylvester@exeloncorp.com
Brent Alderfer
Community Energy, Inc.
150 Strafford Avenue, Suite 110
Wayne, PA 19087
Phone: 610-254-9784
http://www.NewWindEnergy.Com
Section 4 - Baseline Emissions Determination/Base Period Used
In this case study, average CO2, NOx, SO2 and mercury emission rates from the PJM
Power Pool from EPA’s EGRID Database (1998 data) are used as the baseline. The
average PJM Power Pool emission rates are as follows:
 CO2 1,199.053 lbs/MWh
 NOx 2.808 lbs/MWh
 SO2 9.007 lbs/MWh
 Hg
0.0356 lbs/MWh
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Section 5 - Demonstration of Surplus
This wind power marketing activity by Exelon is surplus to any governmental
requirements including the renewable portfolio standard in Pennsylvania.5 An RPS is a
market-based mechanism designed to create demand for renewable resources close to
commercialization. Under an RPS, all energy suppliers licensed in a state are required to
sell energy from renewable generators as a certain percentage of their total energy sales.
Nearly all of the states that have established plans to move to retail competition have
included in those plans a System Benefit Charge, an RPS or both.
Section 6 - Demonstration of Real
An emission reduction is real if it is a reduction in actual emissions, resulting from a
specific and identifiable action or undertaking, net leakage of emissions. A real reduction
in actual emissions will occur due to the wind power generation, as wind turbines emit no
air emissions in operation, so emission reductions are dependent on the emissions
associated with the energy displaced by the wind energy. In displacing a kilowatt-hour
(kWh) of electricity generated by fossil-fired units, wind generation avoids emissions of
carbon dioxide (CO2) and many other pollutants.
Section 7 - Quantification of Emission Reductions
The marketing and sale of the 411,600 MWhs annually from the four wind farms avoids
CO2 emissions that otherwise may be emitted by conventional sources on the grid. In
order to estimate the annual impacts of this quantity of zero emission power being sold
into the PJM grid, the baseline emission rates as noted above are multiplied by the total
annual estimated electric generation by the wind farms.6 See Table 2 below.
Table 2: CO2 Emissions Avoided
Wind Farm
Somerset
Moosic Mountain
Mill Run
Backbone Mountain
Total
MW
MWHs/Year
CO2 Emissions
Avoided (tons)
9
24,440
14,653
52
141,211
84,660
15.6
42,363
25,398
75
203,670
122,106
151.6
411,685
246,816
Key assumptions used in this quantification include the annual generation of electricity
by the wind farms and the emission rates used to determine the avoid emissions.
5
For PECO West Penn, and PP&L, 20% of residential consumers served by competitive default provider:
2% in 2001, rising 0.5%/year; For GPU, 0.2% in 2001 for 20% of customers, 40% of customers in 2002,
60% in 2003, 80% in 2004 and thereafter.
6
Based on natural gas combined cycle CO2 emission rate of 800 lbs/MWh and a NOx emission rate of 1.5
lbs/MWh as identified in STAPPA/ALAPCO, Reducing Greenhouse Gases and Air Pollution – A Menu of
Harmonized Options, October 1999.
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Section 8 - Data Integrity and Uncertainty
The collective annual generation of electricity by the wind farms is assumed to total
approximately 411,600 MWhs. This is based upon an average capacity factor of 31% at
all four of the wind farms. This capacity factor is typical for a wind farm located in these
areas. This assumption has a medium degree of certainty. Annual monitoring of electric
generation will be the determining factor for calculations to identify avoided emissions.
For the purposes of this case study, the 31% capacity factor is the best available.
Regarding the emission rates used to determine the avoided emissions associated with the
operation of the wind farms, the combined cycle natural gas fired facility data obtained
from STAPPA/ALAPCO documentation is the best available at the time and therefore
has a high degree of certainty.
The straightforward calculation of CO2 emissions avoidance is as follows:
411,600 MWhs X 1,199.053 lbs CO2/MWh = 493,632,086 lbs/2000 = 246,816 tons of
CO2 avoided.
Overall, this case study has a medium degree of certainty with regards to the avoidance of
CO2 emissions. The ultimate size of avoided emissions depends on the type of generation
displaced. What is displaced by renewable generation depends on many factors, such as
the regional generating mix and the time of day and year.
Section 9 - Emission Reduction Credits Created
Total estimated avoided emissions equal approximately 246,816 tons per year (tpy).
Section 10 - Ownership
Exelon Corporation owns any and all of the environmental credits that currently exist or
that may exist under future regulatory schemes resulting from this project as agreed to in
the power purchase agreements with Community Energy Inc. On a related note, the
Exelon Power Team has not only contracted with Community Energy, Inc. to deliver the
new wind power to customers but also validates the sale of New Wind Energy
Certificates. Customers choose the amount of wind energy they would like to purchase
as part of their ordinary electric supply. Any purchase of two blocks or more is certified
by Green-e, the non-profit organization which monitors green electricity products.
Section 11 - Other Environmental Impacts
The wind power also avoids approximately 580 tons of NOx, 1,850 tons of SO2 and
14,000 pounds of mercury emissions annually. Additional potential environmental
impacts worth noting here are concerns about bird mortality and visual and noise impacts.
The interaction of wind turbines and avian populations has been studied fairly
extensively, and while bird mortality, due primarily to collisions with turbine blades, is a
concern, solutions are being developed. First and foremost, avian impacts are now
considered in plant siting, and sites in or near migratory pathways or dense bird
populations are considered much less attractive than others. Other factors that influence
avian impacts are the composition of local species, the accompanying land use and
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turbine design, location and orientation. However, while avian mortality can be
minimized with careful site planning, it will remain a factor in the growth of wind power
capacity.7 Advancing turbine design is providing less noisy turbines, but it is also
producing taller, larger turbines that will be increasingly visible. Local concerns over
these issues will make some promising sites less attractive. In particular, it will continue
to be challenging to locate sites near transmission infrastructure, but removed from avian
populations and from public view and potential opposition.
Section 12 - Registration Statement and Signature
As a representative of Exelon Corporation presenting this case study I have personally
examined the case study and believe it to be true and accurately represent the activities of
Exelon Corporation.
Tom Sylvester
7
E.W. Colson, Avian Interactions with Wind Energy Facilities: A Summary (a paper presented at the American Wind
Energy Association’s Windpower 1995 Conference on March 26, 1995).
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