PITTSFIELD, Ill. – Intrigued by the possibilities in Pike County, Trey Goede pitched the idea of developing a wind farm business plan to graduate students in his class at St. Louis University.
One student, mentored by Goede, tackled the plan which led to the development of Affinity Wind, a St. Louis-based wind energy development company.
The student earned a B on the plan. Pike County stands to gain a $250 million wind farm.
Goede, founder and CEO of Affinity Wind, provided an update on the Panther Creek Wind Farm Thursday night at a meeting of the Pike County Board’s agriculture committee.
“It is a very difficult business. Without the support of many stakeholders, we would not be here,” Goede said. “More than anything, I want to take this opportunity to say thank you to anyone in the room who helped us and has been supportive to get us to the point where we are. We could not be more excited.”
County officials welcomed the chance to hear from Goede and Ken Stock, Affinity’s chief operations officer.
“This gives us an opportunity to know where the project is,” County Board Chairman Andy Borrowman said. “We know they were doing a lot of work.”
Plans now in “late stage development” call for Phase One, 18 turbines producing 36 megawatts of electricity, to be in operation by October 2012. Phase Two, an additional 114 megawatts, should be online in December 2013.
“We can taste it,” Goede said. “We’re almost there.”
Goede outlined the project’s progress to date including:
º Securing the project site, 1,600 acres west of Pittsfield, through 30-year leases with two 10-year extensions with landowners. Talks continue with two additional landowners.
º A joint venture agreement with Chicago-based Suzlon Wind Energy Corp., the world’s fifth largest wind turbine manufacturer. Suzlon will provide the 2.0 megawatt turbines for the wind farm.
º Collecting extensive wind data through a tower in place since December 2009.
º Completing environmental studies which included tracking movement of the endangered Indiana bat and developing a habitat conservation plan.
º Seeking a county building permit.
º Working with Prairie Power on an interconnection agreement, connecting the project with the power grid, which should soon be finalized.
“We’ve gone through Wind Energy Development 101. The last thing is selling power,” Goede said.
Power purchase agreements, typically covering 20 years, act as a contract to sell power to a customer.
“Once we get the power sold, then we can put together the financing to pay for the $70M Phase One and balance of Phase Two. That is the last piece of the puzzle,” Goede said. “Our expectation, our goal, our plan is to have power sold or some transaction like that in place in the next three months, no later than the end of January.”
Power companies often are a likely buyer, but increasingly, so are companies looking for green energy sources.
“There are a couple of scenarios where we wouldn’t have a traditional power purchase agreement,” Goede said. “It could be a household Fortune 500 company that you interact with on a daily basis that has an interest in doing something where they would help us build the project. That wouldn’t involve a 20-year power purchase agreement, but it would be an investment by the company that believed in this project.”
Board members raised questions about ongoing maintenance costs – included in the business plan at $3,000 per year per turbine initially and increasing to $38,000 by Year 10 – as well as concerns about flicker shadows on neighboring homes and how this project has avoided, to date, the outcry in neighboring Adams County over a proposed wind farm.
Pike County’s required setbacks, including 1,500 feet from a property line, helped, Goede said, along with careful planning both to avoid flicker issues and potential landowner conflicts.
“We’ve got a couple easements with property owners that won’t have turbines, but maybe we’ll have transmission lines buried. We’ve got plans for someone that can’t host a turbine to get something as we get close to construction,” he said.
Flexibility in locating turbines within the Phase One site also reduced flicker concerns. Some of the wind industry’s first turbines were put up with little thought to flicker, but “in general, the industry has become more knowledgeable … The whole industry does a much better job,” Goede said.