- Cowlitz PUD

Chapter 4: Supply-side resourcesIn recent years the capital costs for construction of new power plants haveincreased markedly. This is due to a number of factors, such as heightenedglobal demand, raw materials, and a weakening U.S. dollar. Demand fromemerging economies such as China and India have put a premium on steel,concrete, copper, and nickel. This has resulted in steep price increases for mosttypes of generating technology. According to Randy Zwirn, president of SiemensPower Generation Group, the cost of building a new coal plant has increased by30% since spring of 2006 3 . Christine Real de Azuza of the American WindEnergy Association stated that the cost of a new wind turbine increased by nearly75% from 2004 to 2006. The uncertainty around capital costs exerts a significantinfluence on the resource selections in this plan.Supply Side Resources Considered in the IRPCowlitz PUD analyzed a broad array of supply-side resource options in the IRP.Each technology has its own unique set of advantages and disadvantages, andtherefore, a unique impact on the District’s bottom line. The resourcesconsidered in the plan are not a complete list of all possible generation types.Rather, the IRP reflects technologies that are deemed to be realistic candidatesby the District’s IRP team.The District gathered resource cost data from a variety of sources. In general,the plan attempts to base its analysis on “regional consensus” data. This wasaccomplished by surveying and averaging the assumptions used by other utilitiesin the region for their IRPs. In circumstances where the District had access tomore specific resource cost data, that information was used instead.3 Wald, Matthew L., “Costs Surge for Building Power Plants”, The New York Times, July 10 th 200730