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Wind export law can cope with economy, observers say  

Credit:  By Art Hovey, Lincoln Journal Star, journalstar.com 27 December 2010 ~~

Invenergy, the first wind-power company to take advantage of Nebraska’s new wind export law, has been running into some economic headwinds recently in Virginia and other states.

In some cases, state regulators wrestling with recessionary concerns have been unwilling to give the go-ahead to proposals to sell wind power because of the impact on utility rates.

But Chicago-based Invenergy already has the go-ahead from the Nebraska Power Review Board for its $448 million Prairie Breeze project, which calls for as many as 133 wind turbines spread across 60 square miles of Boone and Antelope counties.

And wind energy advocates in Nebraska say state regulators aren’t likely to get in the way of future projects meant for export and for power purchases from areas of the country with bigger energy appetites.

Before passage of a 2010 law that allows for Certified Renewable Export Facilities, “there was only so much wind energy,” said Omaha attorney David Bracht, “because the power system here was really focused on just developing power for Nebraska.”

“LB1048 allows wind farms to be constructed specifically for the export market,” Bracht said. “What LB1048 did for wind is what we’ve always been able to do with cattle.”

Most of the state’s beef, he noted, is consumed elsewhere also.

Journal Star attempts to ask Invenergy officials about what’s been happening with their projects in other states produced only a sunny prepared statement about Prairie Breeze from Mark Jacobson, the company’s director of business development.

“We look forward to working with our host community and contributing to its economic development by providing jobs, tax revenue, and payments to landowners,” the statement said in part.

But Tim Geisert, Lincoln businessman and president of the Nebraska Energy Export Association, didn’t sound alarmed about the state’s wind export law turning into a dead end.

Geisert said the cost of generating wind power is becoming more competitive with coal and other more conventional sources. Furthermore, when the economy comes back, power users “will pay just a little bit more, because it’s green.”

That doesn’t mean he expects the Invenergy announcement to be followed quickly by other projects of similar scope.

“I don’t think anything is going to happen very soon,” he said. “When the economy is up and rolling, it requires more energy.”

While he waits for more signs of an economic rebound, Geisert would like to see some refinements in LB1048.

“I think the law takes us about seven miles on a 10-mile journey,” he said.

One example of what he thinks needs to happen to get the rest of the way is to eliminate a requirement that 10 percent of generated wind power be available for use within state borders.

Public power entities, including the Nebraska Public Power District, don’t need more electricity for the foreseeable future, he said. And potential customers for Nebraska wind generation aren’t going to like the uncertainty that goes with the 10 percent clause.

“At any point, they might be relegated down to 90 percent,” even though “they’re going to want a guarantee on the amount of kilowatts they’re going to purchase,” Geisert said.

On a brighter note, Bracht hailed recent passage of tax relief by federal lawmakers that included an extension of the timetable for tax credits for wind energy development.

His firm is working with a company on an Illinois project, for example, where the tax credit offer “does have a pretty dramatic impact on costs. The benefits to the project are fairly significant.”

Bracht also said it’s unlikely that Nebraskans involved with wind energy ever will travel “the rocky road that ethanol had to traverse,” because long-term purchase agreements are locked in as wind projects are built.

At that point, developers can estimate revenue potential “almost exactly.”

With ethanol, “it’s difficult to go out more than a few months and lock in prices, let alone 20 years,” Bracht said.

Source:  By Art Hovey, Lincoln Journal Star, journalstar.com 27 December 2010

This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

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