Integrating Southwest Power Pool Wind to Southeast Electricity ...

SBA. More details on these types of changes are given for individual scenario comparisons later.
Other aspects of interest include the fact that SBA imports increase significantly if hurdle rates
are removed. While this assumption is likely unrealistic, it does show that, for the prices and
plant mix assumed in the model, hurdle rate levels are impacting the flow of energy; removing
them entirely can be thought of as the extreme case. In reality, these may be needed to pay for
transmission and so additional wind, with its required additional transmission may actually
increase hurdle rates.
Figure 5-7: Average net flow by region
The changes in imports/exports between scenarios are obviously very dependent on relative
economics between regions. From hour to hour, the average net flow between any two BAs may
be in the opposite direction of the average values across the year. For example, there would
likely be periods when low wind power output from the wind plants in SPP, coupled with other
load and generation differences, would result in a change in the general flow of energy across the
footprint such that Entergy or SBA would be net exporters and SPP a net importer. The data
shown in Table 5-5 and Figure 5-7 only show average flows. Additionally, different assumptions
about plant mix in each region and relative fuel prices will change the flows. The specific flow
results shown here are dependent on the modeling assumptions utilized for our study. The
results do show, however, that different strategies to balance the intra-hour variability and
uncertainty inherent in wind power will cause changes in how energy is moved across the large
region.
Production Cost Summary
This section describes the differences between production costs for different cooperation
scenarios to provide an understanding of the magnitude of impact different balancing strategies
may have on costs. As with any production cost model for future year scenarios, the absolute
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