December 7, 2011
Pennsylvania

Bethlehem wind energy deal falls through

By Lynn Olanoff | The Express-Times, www.lehighvalleylive.com 7 December 2011

A deal approved in April to partner with two companies to study the wind energy production capabilities of the city’s watershed lands it owns in Carbon County has fallen through, said Stephen Repasch, executive director of the Bethlehem Authority, which oversees the property.

Citizens Energy Corp. pulled out of the deal in August and the second company, Delsea Energy, could not find a willing partner to fulfill the contract, Repasch said.

Since the contract was signed, the profit margin from wind energy has declined with the rise of natural gas production, Repasch said. Delsea could not find a partner willing to accept the payment terms that were approved in April, which would give the authority between $200,000 and $400,000 a year based on the land’s wind energy production capabilities, Repasch said.

“The wind energy market has gone down since we started on this path because of the low cost of natural gas,” he said.

While the Bethlehem Authority will likely not get near the $400,000 a year mark, its wind energy consultants still believe it’s still a worthy project that should generate more interest, Repasch said. The authority still should be able to make between $200,000 and $300,000 a year from a wind energy contract, he said.

“The professionals have told us it’s a very developable project,” he said.

The authority will again seek bids from interested wind energy companies. Selecting a company and drafting a new contract should take about six months, after which a new company will take two years to study the land’s wind energy production potential, Repasch said.

It’ll be another long process for the authority, which has been exploring the possibility of wind energy since 2009. Authority officials believe taking the extra time on such a major project is worth it, authority board Chairman John Tallarico said.

“It’s better to spend a little more time now than later with more problems,” he said. “It cost us a little time, but we decided it’s time to move on.”

The board’s top priority is to protect the city’s watershed property and will only pursue a wind energy deal if it doesn’t harm the land, Tallarico said.

“We’re really fussy about the developer that we have. No matter who it is, the board is really tough when it comes down to it because it’s an environmentally-sensitive area,” he said.

In addition to the land in Carbon County, the city also owns watershed land in Monroe County that was deemed too environmentally sensitive to host a wind energy farm. In all, the city owns 22,000 acres of watershed property.