A state office this week injected new life into an effort to build an immense wind farm in Torrance County that could eventually provide electrical power to hundreds of thousands of homes, greatly reduce greenhouse gas emissions, save millions of gallons of water a year and create hundreds of jobs.
State Land Commissioner Ray Powell on Monday announced that the New Mexico State Land Office will soon be accepting bids to lease nearly 34,000 acres of land — more than 52 square miles —to build the wind farm about 12.5 miles northeast of Willard and west of Encino. It includes 5,400 acres — mostly in Torrance County with some spillover into Santa Fe and San Miguel counties — for a transmission route from the site.
Known as El Cabo, the wind farm would be the largest in New Mexico and would include 87,000 acres of private property in addition to the state land.
A public auction is set for 11 a.m. Sept. 19 at the Torrance County courthouse, 903 5th St., in Estancia.
For years now, a private company, Iberdrola Renewables, has been working to develop El Cabo. The state land would comprise only about 20 percent of the overall project, said Don Britt, assistant commissioner for the State Land Office’s Commercial Resources Division.
“The original project encompasses a pretty large acreage that includes several ranches and ownerships, as well as some state trust lands that they want to utilize as part of that project,” Britt said.
Powell said Iberdrola, a Spanish company with U.S. headquarters in Portland, Ore., in the past has expressed interest in bringing state lands into the project area. Enough has now been accomplished that a threshold has been crossed and the time to go out to public bid has come, he said.
“The proposed El Cabo project ultimately could generate 1,000 megawatts of electric- ity — enough electricity to supply up to 400,000 homes,” said a statement released by his office. “The development would reduce (carbon dioxide) emissions by 2.6 million tons and save over 1.1 billion gallons of water annually compared to coal-driven electricity. The project would be built in several phases over the next 10 years, creating 1,600 construction jobs and over 250 permanent positions.”
Powell said the figures pertain only to the state lands portion of the project.
The state land would be leased only as a single tract, he said. The term of the lease would be 45 years, divided into three phases: initial, operations and decommissioning. Lease rates would range from $2 to $3 per acre during the initial phase up to at least $12 per acre during the height of the operations phase.
To qualify, potential bidders must submit an application to the State Land Office by Sept. 13 that includes a total deposit of $88,777. The opening bid will be $1,000. For more information, bidders can visit www. nmstatelands.org and click on Public Auction for Commercial Lease.
The lease will require the lessee “to successfully plan, develop, manage and market a large scale renewable energy project,” according to bidding specifics.
A few years ago, Iberdrola said it would invest $600 million to build a farm with 149 wind generators. In 2011, the Torrance County Commission paved the way by approving a special use district for the company. A company spokesperson said it had plans to seek an industrial revenue bond to finance construction, but could not say when it might do so or the amount it would request. At that time, the spokesperson envisioned a 300-megawatt project, adding that an average farm costs about $2 million per megawatt.
Back then, Torrance County Manager Joy Ansley said Iberdrola had a number of hurdles it had to overcome before requesting bonds.
Iberdrola will “need to work on power purchase agreements, transmission agreements, finalize leases with landowners and such,” she told the Telegraph in February 2011. “None of these steps require county involvement.” If the company were to request the bond, she continued, “the commission will adopt an inducement resolution, followed by a series of public hearings and finally, adoption of an ordinance issuing the bonds.”
Asked this week about El Cabo, Ansley said simply that Iberdrola is still working on the project.
Also this week, Mark Stacy, the project manager, referred inquiries to the company’s communications department, but said he looks forward to working on a project that offers so much promise for Torrance County.
Powell said leasing state lands for renewable energy is “a new and growing source of income for the State Land Office” that is expected to become the largest growth area for its Commercial Resources Division. In 2002, he signed a lease creating the state’s first wind farm, near Fort Sumner.
“Today,” he said, “there are four existing wind energy projects located on State Trust Lands that are expected to earn more than $50 million over the life of the projects. There are also five pending applications that are projected to earn more than $215 million in future years.
“These projects provide us with a tremendous opportunity to earn more money for State Trust Land beneficiaries — public schools, universities, and hospitals — and to do so while creating jobs and protecting our spectacular and unique natural world in New Mexico.”
Private income generated by El Cabo will help the state and local economies in other ways, he said.
The Commissioner of Public Lands is independently elected and is responsible for administering 13 million acres of land granted to New Mexico in 1898 and 1910. Last year, the trust lands produced more than $653 million, saving the average household about $850 a year in taxes, Powell said.