This dispute before the American Arbitration Association involved a renewable energy power purchase agreement (PPA) between BP Wind Energy (BP) and Westar, an investor-owned utility, for electric energy generated by BP’s Flat Ridge wind farm in Kansas. Generation from the wind farm occasionally was curtailed by the Southwest Power Pool beginning in March 2009. The basic issue in the dispute was whether the parties’ PPA required Westar to pay BP damages associated with the series of curtailments. BP sought to recover the lost revenues and lost production tax credits, plus accumulated interest, for “lost power” not generated by the wind farm due to the curtailments.
Econ One was retained by counsel for Westar to respond to the expert report filed on behalf of BP and to calculate the damages, if any, should Westar be found liable. Jane Kidd submitted an expert report and testified at the arbitration hearing that BP’s damages claim was overstated because BP’s expert: (1) relied on an estimate of expected power output that exceeded the amount that would have been produced; and (2) failed to utilize a methodology that limited damages to power lost as a consequence of the curtailments. Ms. Kidd also provided an opinion of potential damages. The arbitration panel denied BP’s claims in their entirety and awarded no damages