PAYNESVILLE – By now, turbines were supposed to be scattered across the fields north of Paynesville, their blades turning steadily to produce electricity and income for local farmers.
But Central Minnesota’s first large-scale wind farm is about a year behind schedule as its backers try to find a utility company that will agree to buy its energy.
Geronimo Wind Energy has the state and local permits required to build the 95-megawatt wind farm, which is expected to have as many as 60 turbines – each roughly 400 feet high.
The Edina-based company has signed agreements for easements with landowners in Zion, Paynesville, Spring Hill and Lake Henry townships. Geronimo had planned to erect the turbines this year and expected them to be generating electricity as soon as the third quarter of 2011.
But so far, the company has failed to secure a power purchase agreement for the wind farm. Charlie Daum, a spokesman for Geronimo, attributed the delay to the slow market.
“That’s really the only thing that’s holding us back right now,” Daum said. He called it “not a concern as much as a frustration.”
“We had hoped to have it operating by now,” he said.
Geronimo has talked to companies both within and outside of Minnesota, Daum said. He said it’s surprising that more utilities don’t want to lock in long-term contracts to secure power at today’s low prices.
Some reports have suggested the burgeoning wind industry is experiencing a slowdown in momentum. Turbine manufacturer Suzlon cut 110 jobs at its Pipestone factory in 2010, and other companies have had difficulty securing credit in a tighter financial market.
Matt Swenson, spokesman for the state Department of Commerce, said the state’s wind industry remains strong as companies are trying to take advantage of a federal tax credit for wind development that expires Dec. 31, 2012.
An additional 533.55 megawatts of wind power was installed in 2011, the most installed in a single year in Minnesota so far, according to Swenson. A slightly smaller development boom is expected in 2012, but the outlook for 2013 is uncertain.
A recent report from the American Wind Energy Association found that if Congress allows the production tax credit for wind to expire, it will mean the loss of 37,000 U.S. jobs.
Xcel Energy recently signed a power purchase agreement with Geronimo for the 200-megawatt Prairie Rose Wind Farm in southern Minnesota, said Tom Hoen, Xcel spokesman. He said the company is well on its way to meeting the 2007 state standard that requires Xcel to get 30 percent of its power from renewable resources by 2020.
The company’s latest resource plan notes that the economic slowdown has reduced the expected future demand for electricity.
Xcel will continue to explore opportunities to procure as much as 300 megawatts of additional wind generation before the tax credit expires, plan states. However, it adds, “While we are eager to obtain low-priced, cost-effective wind generation for our customers, we seek to avoid the risks of incomplete or failed projects.”
Daum said Geronimo is pushing forward on the Paynesville project so it is ready to build it next year if it can. The remaining work includes engineering and determining where the turbines will go, he said.
The project’s permit from the Public Utilities Commission is good for three years before an extension is required. The easements signed with landowners expire in seven years if the project isn’t built, Daum said.
The company has been meeting with landowners in the project to explain what’s happening, he said.
“We think it’s a great project, and we really do want to get it built,” Daum said. “We’re telling them we hope to build it next year.”