Power Is Trading Below Zero in Middle America Amid Strong Winds
(Bloomberg) -- Strong and steady breezes are helping states in the central U.S. generate so much electricity from wind turbines that wholesale power prices have fallen below zero.
It’s a relatively new phenomenon in America’s spot power markets. When there’s an overabundance of solar or wind, grid operators send prices plunging to negative levels -- a signal to generators that they need to take supplies offline so they don’t overload transmission lines. On Friday, wind output surged to as much as 17,264 megawatts across the Southwest Power Pool -- a grid that stretches from North Dakota to Texas. That’s more than 60% of the region’s power.
Power prices fell below negative $10 a megawatt-hour for much of the region.
Negative electricity prices are becoming commonplace in parts of the U.S. including California and Texas as utilities bring online massive solar and wind farms that have no fuel costs. Texas, Iowa and Oklahoma are home to more wind power generation than any other states. Kansas, Minnesota and North Dakota are among the top ten wind-producing areas.
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