Great River Energy (GRE), a Minnesota-based generation and transmission electric cooperative, has issued a request for proposals (RFP) for a total of 120 megawatts (MW) of renewable energy resources. At least 20 MW and up to 120 MW may come from Community-Based Energy Development (C-BED) proposals if the cost of the C-BED projects are not more than 10 percent above the cost of non C-BED projects.
The term “C-BED” stems from legislation passed earlier in the year that requires the Minnesota Public Utilities to approve new tariffs for renewable energy projects meeting certain locational and ownership criteria. In general these projects will be eligible for higher payments during the initial 10 years of a 20-year power purchase agreement [for more see this previous story in Democratic Energy].
GRE’s RFP outlines their commitment to support C-BED projects saying, “Of this 120 MW, 100 MW is nominally intended to be from a large project and 20 MW reserved for qualified CBED project(s). A competitive large project may be CBED as well. However, GRE will not accept any small C-BED proposals with an evaluated price greater than 110 percent of the lowest evaluated price large project.”
Great River has encouraged creative pricing proposals but at a minimum, all bids must offer a flat/levelized price. Projects eligible for a C-BED type pricing structure should indicate their price in terms of net present value (NPV) while using GRE’s discount rate of 5.25 percent.
Also of note in the RFP is that GRE expresses an interest in possibly taking an ownership interest in a wind energy project. Citing the recently enacted Clean Renewable Energy Bonds program in the Federal energy bill, GRE will “evaluate partial ownership as well as turnkey proposals.”
Responses to the RFP are due Friday, December 9, 2005. A nonbinding Notice of Intent to Respond is due on Friday, November 11, 2005
Great River Energy announced its intent back in July 2005 to meet the non-binding requirements of the 10 percent Minnesota Renewable Energy Objective (REO) by 2015. To meet the goal will require the mostly coal-based utility to acquire about 500 MW of renewable energy resources. GRE expects to regularly issue similar RFPs in the coming years in order to meet the REO.