Wisconsin Energy Corp. has agreed to buy a Dodgeville-area wind farm for $27 million, the utility announced Wednesday.
The company reached agreement last week with NextEra Energy Resources Inc. of Florida to buy the Montfort Energy Center, a 20-turbine wind farm that opened in 2001.
The deal was announced during a conference call with investors to discuss Wisconsin Energy’s second quarter results.
“We believe this acquisition will deliver positive economic benefits for our customers and our shareholders,” said Gale Klappa, the utility’s chairman and chief executive.
Montfort Energy Center generates 30 megawatts of electricity, with 4.5 megawatts sold to Madison-based Wisconsin Power & Light Co. and the remainder sold to We Energies. The project generates enough power for about 9,000 typical homes, according to NextEra.
The deal opens the door to We Energies customers receiving the entire output from the wind farm beginning in 2021, when the power purchase agreement with Wisconsin Power & Light expires.
In addition, the wind farm could be rebuilt with turbines that generate more power, Klappa said.
An ‘active site’
“This is an active site for wind output and we believe, if needed, we’ll have the opportunity to repower the site” with turbines on taller towers that generate more electricity, Klappa said in an interview.
Based on wind farms it has built, purchase of renewable energy credits and the $250 million biomass power plant under construction in Rothschild, We Energies expects to be in compliance with the state’s renewable portfolio standard through 2018, Klappa said.
Under state law, We Energies must generate 8.25% of its electricity from renewable sources by 2015.
Construction of the biomass plant at Domtar Corp.’s paper mill is 39% complete, and is scheduled to be completed next year. The plant will burn tree tops and branches left over from logging operations as well as sawdust and chips.
Built in 2001
The turbines at Montfort, which was built in 2001, each generate 1.5 megawatts of power, but Wisconsin has seen construction of higher-output turbines. We Energies’ Glacier Hills Wind Park in Columbia County, which opened last year, uses 1.8-megawatt turbines, and the state is home to one wind farm with 2-megawatt turbines.
The purchase price is roughly about half of what it would cost to build the equivalent amount of wind power in a new project, Klappa said.
NextEra would continue to operate the Montfort wind farm, Klappa said. NextEra Energy Resources operates wind farms around the country as well as nuclear plants including the Point Beach nuclear plant, which Wisconsin Energy sold to NextEra five years ago.
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