A post yesterday by Susan Kraemer on the Clean Technica blog highlighted a shocking statistic from Dr. F. David Doty on GreenTechMedia:

“Approximately 25 TWh (yes, 25 terawatt-hours) of wind energy was curtailed (idled) in the U.S. last year to keep the off-peak grid energy price from frequently going negative.  That is about equal to the energy in 700 million gallons of gasoline just being thrown away. Curtailed wind energy in the U.S. appears likely to exceed 40 TWh in 2011″

Essentially, curtailment describes a situation where a renewable project is producing energy, but the transmission owner will not allow that energy to go onto the electrical grid. Thus, unless there is some way to store the energy, the energy is wasted.  The impacts of curtailment rarely get media coverage because it is complicated and usually largely controlled by dense contract language within Power Purchase Agreements (“PPAs”) and Interconnection Agreements between the renewable developer and the transmission owner.  Nonetheless, the impacts are significant for project developers.

To give a sense of the amount of energy that we are talking about here, curtailing 25 TWh of energy is roughly equivalent to throwing away a full year of energy output from a 115 MW project that is running at full capacity, or a 300 MW wind farm running at a good normal capacity factor of around 40%.

One of Susan’s main points is that this curtailment can hinder the hugely important financing of renewable projects, and ultimately can cut into the project’s bottom line.  I couldn’t agree more with her analysis.  The potential impact of curtailment can be substantial for a renewable energy project.  Whether or not the project developer gets paid for curtailed energy depends on how the PPA is drafted, and often the developer gets stuck with the bill.  If you are a project developer, 25 TWh should definitely be a statistic that you keep in your mind when negotiating and drafting PPAs with utilities and transmission companies.