Wind energy in Nebraska

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The sixth windiest state, potentially capable of producing 868 billion kilowatts a year, ranks only 19th in wind-energy production.

By Sally Herrin

Construction of an Enercon E-70 wind energy converter. (Public domain)The wind is an old friend to the busy race of humans, from time past remembering. Every Nebraska landscape worth its weight in tourist brochures has a stock tank windmill, some relict, some working still. More recently, wind has been a huge, largely underused resource in Nebraska. The sixth windiest state with an estimated production capacity of 868 billion kilowatts a year, Nebraska ranks 19th in wind-energy production in the U.S., with just 73 megawatts online today.

As wind energy development has visibly expanded in nearby states like Minnesota and Iowa, Nebraskans may be wondering why our state isn’t bristling with wind towers, too. For a couple of years beginning in 2000, I served on a governor’s wind-energy task force that was directed to identify barriers to wind-energy development in Nebraska. To make a novel into a comic book, the problem unique to Nebraska was how to resolve the delicate matter of ownership of wind generation in our 100 percent public power state.

By state law, Nebraska’s public power entities are charged with providing the state with reliable energy at the lowest cost to consumers. For a very long time, that formula has translated into coal-fired generation. As fuel, “old coal” contracts may be relatively cheap, but costs are rising. Coal’s greatest cost is rail transportation, and Nebraska is relatively close, as we reckon relative distance here on the Great Plains, to the coalfields of Wyoming.

Financial incentives in the form of federal tax credits aren’t available to public power entities, and despite increasing public pressure to use more energy from renewable sources, the state’s power providers were in no great hurry to invest in wind fields. Taking the long view, energy from wind grows increasingly cost-effective over time. However, power providers to our great big state with not many people face special circumstances.

The cost of building new transmission capacity for big wind fields is daunting. The decades-long decline of Nebraska’s rural population is also a problem for the power providers. What if they build the lines and their customer base keeps on dying and moving away? The good news is to the extent that wind-energy development can generate economic activity in greater Nebraska, we could actually see a slowing and reversal of rural population decline.

Building new, large-scale transmission is only necessary if what the state creates is giant wind fields or if the intention is actually to export wind power. Community-based energy development (or C-BED) tends to be dispersed, rather groves of a dozen or so turbines across many counties than a few big fields, with turbines in endless rows to the horizon. Dispersed wind generation does not in most cases require big new transmission spending.

It would be possible for public power to partner with a big developer, say Florida Power and Light, one of the major players in Minnesota and Iowa wind development. When wind resources are developed by big out-of-state corporations leasing wind rights from landowners, however, the payments top out at about $3,000 per megawatt—chump change, actually—and the profits go mostly out-of-state. Think about the generational poverty of the hill folks of Appalachia whose great-great-granddaddies all sold their mineral rights to Peabody Coal and other mining companies, and you get the picture.

By contrast, the C-BED model, as practiced in parts of Minnesota and Iowa, partners landowners, ag producers, schools, communities and so on with equity investors and returns substantial income to communities, income which multiplies many times over and fuels local economies. In 2007, the Nebraska Legislature passed the Rural Community Based Development Act (LB 629), paving the way for C-BED in Nebraska.

LB 629 directs electric utilities to enter into power purchase agreements with C-BED developers. This act defines a C-BED project as a new wind-energy project that meets certain ownership criteria. “Qualified owners” must be Nebraska residents or a limited liability company made up of Nebraska residents, a Nebraska nonprofit organization, any of the state’s top four electric suppliers (LES, NPPD, OPPD or Tri-State) or a tribal council. For projects with more than two turbines, no single qualified owner can own more than 15 percent of the project, with 33 percent of the power-purchase-agreement payments to the qualified owners or to the local community. Projects with one or two turbines are owned by one qualified owner or more, with at least 33 percent of the power-purchase-agreement payments flowing to the owners or to the local community.

Several C-BED projects have already been approved for the northern tier of counties and more are in the pipeline for consideration. In early August, Third Planet, a corporation approved to develop a wind project, released a statement indicating that C-BED is the favored model in Nebraska, so the corporation will be offering landholders the chance to invest. These are promising developments for consumers, for state economic development and for the environment, and here’s why:

Wind is free, so wind-generated energy will remain affordable. As with solar energy, using wind today in no way diminishes the wind available tomorrow or in years to come. That means, once turbines are built and service plans are in place, there are no fuels costs—ever. Wind projects are secured with price contracts, and when price-stabilized wind power provides a substantial part of the energy mix in this state, our public utilities can plan better and pass savings on to consumers.

Wind-energy development is creating jobs. The new owner of venerable windmill producer Dempster of Beatrice, Neb., hasn’t offered details, but indicates alternative energy is his interest. Two years ago, there was only one certificate-level program in “wind-smithing” in the U.S. Today, more than 20 states have wind-technology training programs and another half dozen states have programs under development, according to a U.S. Department of Energy Web site.

Wind is clean. Turbines make extremely modest footprints—a concrete pad the size of a ranch house and a service road—and they are almost completely silent. Cows, soybeans and meadowlarks alike thrive happily in the shadow of two-megawatt giants.

Wind generation has next to no clean-up costs. Both coal and nuclear power plants create toxic waste and pollution, and both require extremely costly decommissioning when their useful lives end.

Wind energy production uses no water. Water—how we share it, especially in drought cycles—is predicted by a lot of smart folks to be THE issue of this century for Great Plains states. Both nuclear power plants and coal-fired plants use significant amounts of water for cooling. In the future, Nebraska irrigators face drilling and pumping moratoria, while public power plants are exempt. Every watt of coal generation displaced by wind generation takes pressure off our precious and declining water resources.

On July 9, The Wall Street Journal published T. Boone Pickens’ letter to the nation, “My Plan to Escape the Grip of Foreign Oil.” Famously, Pickens has declared his solution to the energy needs of the U.S.—divert the natural gas NOW used to generate electricity to fuel transportation by building wind to help power the electric grid. Pickens notes that wind is 100 percent domestic, 100 percent renewable and 100 percent clean.

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