3 Midwest states, Manitoba to dovetail energy supply

Many Nebraskans and Dakotans may not know it, but their energy future is tied directly to Canada. Faced with a rapidly rising peak power demand in the summer, the states are looking north for new supplies of energy.

In the days of cheap fossil fuels, the answer to increased power demand would have been a new coal plant. But the rules of the game have changed, at least temporarily, for power companies in the agricultural Midwest.

The outlook through the next decade at least is for slower growth in overall power demand, but rapidly increasing peak demand in the summer months.

Coal is no longer cheap, making power production increasingly expensive. This , plus high construction costs, has utility officials wondering if it makes dollar sense to build a plant just to meet peak demand through the 1990s.

To solve their energy problems, Manitoba Hydro and the Nebraska Public Power District (NPPD) have teamed up for a seasonal exchange of power.

Capitalizing on seasonal differences in demand, a 630-mile transmission line will link Hoskins, Neb., with Winnipeg, Manitoba, by 1988.

Dubbed MANDAN (Manitoba, Dakotas, Nebraska), the joint venture will pool conventional power resources in the United States with abundant hydro power in Manitoba. When completed, the energy equivalent of 12 million barrels of crude oil will travel the MANDAN line each year.

''It's something we started thinking about in the mid-70s after the oil embargo, when the push was on for national energy efficiency and self-sufficiency,'' says Wayne Jacobsen, a spokesman for NPPD.

''We figured the concept was a good deal for everybody involved,'' he adds. ''It meshes our seasonal differences in demand well and makes greater use of water, which is a renewable source of power.''

Exchanging power on a seasonal basis isn't a new idea, but skyrocketing fossil-fuel costs have made it a reality. Officials at NPPD and Manitoba Hydro view ''seasonal diversity exchange'' as a tool to curb increasing electric rates by more efficient use of power production capacity.

Seasonal diversity is the key to seasonal exchange. Differences in climate between Nebraska and Manitoba mean basic differences in power demand. When seasonal peaks and low demand periods occur partly or completely opposite each other, seasonal diversity is established.

A high seasonal diversity has made Nebraska and Manitoba obvious candidates for an energy exchange team.

Manitoba has a surge in consumer demand for power during its frigid winter. Nebraska, on the other hand, has a power surplus during the same period. The benefits of an exchange are clear: Manitoba gets the power it needs fairly cheaply, and NPPD sells most of its winter surplus.

In summer the power demand situation is reversed. NPPD feels the heat as Nebraskans turn on air conditioners and operate irrigation pumps 24 hours a day. Demand sometimes outstrips generating capacity, making expensive purchases of peaking power from neighboring utilities necessary.

During longer daylight hours and the mild temperatures of the Manitoba summer , power demand is down.

The spring melt and runoff begins in April and high water continues through August. Taking advantage of Manitoba's water surplus means cheap rather than expensive peaking power. MANDAN would allow Nebraska, South Dakota, and parts of North Dakota to soak up excess Canadian power during the summer.

Seasonal flip-flopping of power would help smooth out the peaks and valleys in electricity demand. A winter-summer Manitoba-Nebraska exchange would, in utility jargon, ''streamline the system load factor.'' The plan would save money by using plants and equipment built for peak load in the off-peak seasons, also increasing off-peak revenues.

Despite economic slowdowns and resulting decreases in electricity use in other parts of the country, Nebraska's agricultrual economy is producing a 4.4 percent annual growth in peak demand.

In 1980, for example, NPPD generated about 50 percent of its total annual power capacity. This 50 percent surplus belies the reality of the annual summer power crunch. A year ago NPPD officials debated whether to build a new 650 -megawatt coal plant to supply power four months of the year.In 1980, for example, NPPD generated about 50 percent of its total annual power capacity. This 50 percent surplus belies the reality of the annual summer power crunch. Last February NPPD officials debated whether to build a new 650-megawatt coal plant to supply power four months of the year.

NPPD postponed plans to build the new coal-fired plant in favor of MANDAN. The transmission line won the decision for the following reasons:

* Steadily increasing coal costs (up 255 percent since 1973) compared poorly with cheaper water power.

* MANDAN will cost less to build ($686 million) than an equivalent-size coal-fired ($980 million) plant.

* Expanded markets for surplus power and other energy transactions will increase overall efficiency and revenue.

* Maintenance on the power line will be far cheaper than for either nuclear or coal plants.

* Manitoba Hydro can potentially triple its present power capacity to meet future demand in the US.

As MANDAN eases the peak demand burden, it will also mean expanded markets for NPPD and Manitoba Hydro in the Dakotas and Minnesota. Utilities serving North Dakota have the same winter power problem that Manitoba Hydro faces and have shown interest in tapping in to MANDAN for winter power.

''There are a great deal of east-west-running transmission lines that make MANDAN, as a major north-south line, look very good to us,'' says John MacFarlane of Otter Tail Power Company. ''The high-cost item for us is a new plant. If we can use MANDAN to trade power efficiently and draw on hydro power, there will be a curtailed need for plants in the near future.''

For Manitoba Hydro, the opportunity to bring its vast hydro resources to a thirsty US market is doubly important. Beside the benefits of seasonal diversity exchange, new markets for summer power may mean further development of untapped hydro resources.

''Efficient use of our summer surplus . . . will probably encourage further hydro projects along the Nelson River,'' says Dennis Woodford of Manitoba Hydro.

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