Rural cooperatives add wind, cautiously
Rural electric co-operatives across the country are adding more wind power, but it is not always easy.
“These rural electric utilities sit on top of a gold mine — some of the best wind resources in the country,” said Jeff Anthony, the manager of utility programs at the American Wind Energy Association, in an e-mail message.
Brian Hobbs, an official with the Western Farmers Electric Cooperative in Oklahoma, said that wind now accounts for 11 to 12 percent of his generation mix (coal is another 45 to 47 percent, and natural gas about a third). But since the co-operative began adding wind power in 2003, prices have more than doubled.
“That certainly is a concern,” he said, noting that the co-operative will also keep a close eye on any additional operating costs incurred because of wind’s intermittency. He expects to wait until around 2012 to add more wind power; the co-op’s motivation for adding wind was largely to hedge against higher natural gas prices, which are currently in a slump.
As this recent article in High Country News notes, many electric co-operatives — which have origins in the New Deal’s rural electrification push — remain dependent on coal but have come under pressure from customers in affluent places, like Taos, New Mexico, to add more renewable energy and move away from coal.
Tri-State, a Western utility serving a number of rural co-operatives (and which, according to the article, gets 72 percent of its electricity from coal), just announced its first utility-scale wind investment, to be built in Colorado in partnership with Duke Energy.
Mr. Anthony notes that because rural co-operatives are non-profits, they have traditionally had trouble taking advantage of the “production tax credit” that has been a driving force for wind development in the United States (although there are ways to overcome this, he said, citing the White Creek wind project in the Pacific Northwest as an example).
Due to their small size, rural electric co-operatives are often effectively exempted from the renewable energy mandates that are in place in more than half the states, according to Mr. Anthony. (They also fall below the radar in the federal “renewable electricity standard” passed by the House last month.)
Even as they cautiously add wind power — the cheapest of the renewables — some co-operatives remain concerned about the climate change bill passed by the House last month.
As my colleague John Broder has reported, rural co-operatives were initially given none of the free allowances to pollute; but eventually they received some $400 million worth of the allowances, after lobbying from the National Rural Electric Cooperative Association, which holds some sway over farm-state lawmakers.
“We think that the House moved that bill a long ways toward being more fair in the way that it allocates emissions allowances,” said Mr. Hobbs, adding that he hopes for a better deal in the upcoming Senate version. The House bill, he estimated, could raise electricity prices for his customers by 20 to 30 percent.
By Kate Galbraith
7 July 2009
Tags: Wind power, Wind energy
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