Southwestern Electric Power Company (SWEPCO), a subsidiary of American Electric Power (AEP), on Tuesday launched a request for proposals (RFP) for up to 1.2 GW of wind generation.
The utility wants to see the projects in operation by December 2021, so they can take advantage of at least 80% of the federal Production Tax Credit. Projects should be at least 100 MW and within the Southwest Power Pool's (SPP) territories of Arkansas, Louisiana, Texas or Oklahoma.
- The RFP comes after AEP cancelled in July what would have been the largest wind project in the country after the Public Utilities Council of Texas ruled the 2 GW project would not benefit ratepayers.
As the federal tax credit winds down, more utilities are likely to move forward with wind power projects to take as much advantage of the federal support as possible. Iowa regulators last month approved a 591 MW project from MidAmerican Energy, which will give the utility 6.6 GW of operating renewables in Iowa once it's completed in 2020.
SWEPCO is adding the generation in compliance with its integrated resource plan, which calls for "significant increases in renewable energy over the next 20 years," SWEPCO Communications Director Carey Sullivan told Utility Dive, adding that they're looking to find the most "efficient wind generation and the best prices" within the SPP territory.
Once the bids are evaluated, the utility will need approval from state regulators in Texas, Arkansas and Louisiana, as well the Federal Energy Regulatory Committee, but may continue to move forward with a project, even if one state rejects the proposal, according to Sullivan.
SWEPCO parent company AEP last February revealed a carbon reduction strategy that involves reducing emissions 60% below 2000 levels by 2030 and 80% by 2050, in part by adding more than 3 GW of solar and more than 5.2 GW of wind. Currently 8% of SWEPCO's generation comes from wind, with 90% evenly split between natural gas and coal-fired generation.
In November, AEP released its 2019-2023 capital investment plan, which will focus largely on improving transmission and distribution, but also includes $2.7 billion of new renewables generation.