January 29, 2014
South Dakota

Wind farm promises to give area a lift

BY RANDY DOCKENDORF | Yankton Press & Dakotan | January 28, 2014 | www.yankton.net

FREEMAN – A new wind farm in southeast South Dakota should help the state boost its wind energy production, according to the wind farm’s leader.

Ron Hornstra, a rural Avon resident, serves as president of B&H Wind LLC. He spoke Tuesday at the Southeast Research Farm’s annual meeting on the Freeman Academy campus.

Citing a national study, Hornstra noted South Dakota has been ranked as one of the five windiest states.

“South Dakota has tremendous wind potential,” he said. “We have the potential for producing 882,412 megawatts of wind energy annually.”

However, South Dakota lags behind other states in developing wind energy, Hornstra said. He pointed to the sight of numerous wind turbines visible across the border with Minnesota.

“If you drive toward Pipestone, Minn., along I-29, you don’t need a sign to know the state line,” he said.

Hornstra outlined the various taxes and landowner payments for a typical 2.5-megawatt turbine operating at 44 percent efficiency.

“If you assume that a wind turbine is operated for 20 years, that comes to $611,275 in taxes and landowner payments for a wind turbine, or $30,564 a year for one turbine,” he said. “If you have 100 turbines, that comes to $3 million in new dollars a year, and 10 to 12 well-salaried jobs a year.”

One wind farm can exert a tremendous impact on the local economy and the tax base for counties, schools and other entities, Hornstra said.

“If we develop even 1 percent of South Dakota’s potential, that would amount to 30,000 jobs, which is about the size of Aberdeen,” he said. “The new revenue brought into the state would amount to $240 million annually.”

Hornstra believes that B&H Wind can play a key role when it comes to tapping into that potential.

Comprised of about 50 area investors, B&H Wind was formed in 2009 in response to interest in a wind farm project. Public meetings were held in Avon, Tripp, Tyndall, Springfield and Wagner. The corporation leased approximately 34,000 acres southwest of Tripp for the project.

B&H Wind started construction of its wind farm last month near the intersection of Bon Homme, Hutchinson and Charles Mix counties, Hornstra said. The project is expected to be completed later this year, he added.

B&H recently sold 39 megawatts of electricity to NorthWestern Energy, adding to the original power purchase agreement of 41 megawatts previously signed by the two parties.

Because of a confidentiality agreement, Hornstra said he couldn’t reveal the price that NorthWestern is paying for the B&H Wind power.

However, Hornstra added that the wind farm’s price compares favorably with the cost of other types of energy. “We can compete very well with coal,” he said.

The B&H Wind experiences provide valuable lessons for other wind development efforts, Hornstra said.

“How do we develop our potential? What are the resources in our area?” he asked. “If there is a good wind resource, how is it transmitted?”

In charting its course, B&H drew from the experiences – both good and bad – of other wind-farm efforts, Hornstra said.

“At the start, we organized tours and learned from others,” he said. “At Pipestone, we saw a turbine on the playground, which the school owns. You don’t normally expect to see a turbine there. But it’s paying all of the heating bills and cooling bills for the school, the cost of the turbine, financing – and there is over $20,000 left at the end of the year.”

B&H organizers also toured an operation very close to home – the Elkhorn Ridge Wind Farm near Bloomfield, Neb., in neighboring Knox County, Neb. The operation consists of 27 turbines, with each turbine 410 feet from base to blade tip. Elkhorn Ridge holds the capacity for producing 81 megawatts, enough electricity to serve approximately 25,000 homes.

Midwest Wind was the developer, with the Edison Mission Group as the owner. The power is purchased by the Nebraska Public Power District (NPPD).

The South Dakota visitors were in awe of the massive size of the turbines, Hornstra said. “That’s like lifting two fully loaded semis into the air,” he said.

The B&H organizers also studied landowner agreements and other legal and financial aspects, he said. However, they realized they eventually needed to take action.

“We had people providing leadership, but we had no formal organization,” he said. “We needed to get organized and make our decisions.”

The B&H investors interviewed more than a half-dozen professional developers before hiring one. They also worked with landowners on procuring leases for wind rights.

However, a key component was verifying the availability of a dependable wind supply, Hornstra said. “The bankers want at least three years of solid data before they will talk to you,” he said.

In 2009, B&H erected 198-foot towers to measure the wind, Hornstra said. The towers showed the prevailing winds came from the northwest.

During Tuesday’s presentation, Hornstra explained the remaining hurdles – including the marketing, regulatory and interconnecting processes – needed to make the project a reality.

The B&H turbines hold a 30-year life expectancy, compared to other turbines with a 20-year life, he said.

“Some of the first ones (that were erected during older projects) are not lasting nearly as well. You are seeing changes in turbine technology,” he said. “It’s like the computers that are 10 years old and aren’t nearly as efficient as the newer ones.”

Former state legislator Frank Kloucek of Scotland spoke as an audience member, commending the B&H Wind effort.

“They started from ground zero and learned from others’ mistakes,” he said. “They started this (wind farm) locally, and I can’t say how important that is.”

The B&H Wind project will exert an impact far beyond the local investors and the immediate area, Kloucek said.

“This is good for the landowners, good for the consumers and good for South Dakota,” he said. “You (organizers) have done it, and you’ve done it right.”

“Just listen to Peter, Paul and Mary, when they sang, ‘The answer, my friend, is blowin’ in the wind,’” he said with a laugh.