United States

United States

Community wind movement spreads -- A niche market

The concept of local wind plant owned by local people is spreading out of Minnesota. While the state remains the hub of the movement, with 334 MW of locally owned plant in operation, it is growing faster elsewhere. Some 750 MW of community wind is now online from coast to coast, reports Windustry, a Minnesota proponent of the idea.

"Most of the good news about community wind is in places other than Minnesota," says Windustry's Lisa Daniels. "But there is lots of good news." Washington jumped into second place behind Minnesota on the strength of one 2007 project -- the 205 MW White Creek facility in Klickitat County, developed and owned by Last Mile Electric Cooperative.

Now it is Nebraska, with 73 MW of community-owned wind plant online, that is stealing the limelight, with a significant volume of locally owned projects on the way, including the 80 MW Elkhorn Ridge project, expected online by the end of this year, and a 42 MW project, Crofton Hills, being developed by community wind pioneer Dan Juhl from Minnesota. California, meanwhile, totals 40 MW, and Iowa rounds out the top five with 36 MW. Idaho, at 11 MW, is the only other state in double figures.

Some of Minnesota's continued dominance can be attributed to the advent of Community-Based Energy Development (C-BED) legislation, which makes utilities pay a higher price for wind production in the early years to help locally owned wind plant pay off equity and debt costs in exchange for a lower price in later years.

But the formula for calculating the upfront rate, set in 2005, has meant prices in Minnesota have not kept up with the market. As a result, only 57 MW of C-BED projects have come online. Nebraska, meanwhile, is using an updated formula in its more recent C-BED legislation that Elkhorn Ridge and Crofton Hills are making good use of.

Daniels describes a cumbersome Minnesota C-BED process whereby utilities might issue requests for proposals in January and make selections in April or May, while projects are not fully negotiated until October or November. "The whole world has changed in the time that it takes," Daniels complains. "Prices are out of date -- not only the prices of machines, but the cost for transportation of those machines to get them to the site. The contracts for construction and the cost of concrete even go up."

A legislative task force is looking at ways to smooth out the Minnesota law, says Daniels, but even that process is taking time, she adds. "The Minnesota C-BED statutes have gone through two or three revisions now," she explains. "C-BED seems to be working better in Nebraska. Community wind has a good future, but whether it's with C-BED or not is yet to be determined."

Daniels also points to a lack of mid-size turbines and chaotic transmission queues that can favour corporate giants as two potential roadblocks to community projects. "These projects have to work," she says. "There's no capacity to absorb a loss from a project that gets delayed. There is no margin in community wind."

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