Rural wind power shifts direction

  • Article by: THOMAS LEE , Star Tribune
  • Updated: February 22, 2008 - 12:31 AM

Wind-power developers and local landowners are turning to a cooperative business model as a way to jump-start large-scale projects.

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MHFeb. 21, 0811:25 PM

As long as everyone does their due-diligence, this business model looks great. Local participation in wind farm development can leverage large scale wind farm projects and demonstrate need to electric utilities for the requisite transmission lines these projects need in order to be successful. Another route to another win-win renewable energy project in Minnesota.

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use2buyFeb. 22, 08 1:17 AM

The numbers don't add up regarding who owns what percentage of the project. Unless the largest factor is the land value which is never directly defined. Does National Wind really somehow raise $998.5 million dollars from investors? Out of a $1 billion project and it still somehow only has a 30% stake? So does it somehow have $300 million sitting around? Please explain. --------- National Wind will typically own 30 percent of the project; the rest belongs to local farmers and landowners. A typical 600-megawatt project will cost about $1 billion. Local investors will put up around $1.5 million, and National Wind raises the rest National Wind's business model is designed to benefit from Minnesota's Community-Based Energy Development (C-Bed) laws. Passed in 2005, C-Bed requires utilities to offer community wind projects -- defined as 51 percent local ownership.

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dcrothersFeb. 22, 08 6:45 AM

I agree with "use2buy", the numbers don't add up in the story. Also, there was no discussion on the financial return to the local investors. Worse, wind farms will now be placed in communities that "have the investors", rather than locations closest to transmission lines or where it is naturally windy.

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overlandFeb. 22, 08 8:05 AM

The financial model is one that's long overdue, giving regular investors the option of getting into projects without individual ownership and being subject to the wind financing cabal. All C-BED serves to do is front-end load the power purchase agreement so that the cabal continues with egregious profits and the owner doesn't have to wait so long to see some return, and that's no solution. And as dcrothers notes, siting is also important. Stewartville is mentioned, SE Minnesota and transmission wise, that's a better location, siting closer to load and where there's room on the system. If you site near transmission, you can make up some for lower wind speed, because transmission of wind from Buffalo Ridge just to the metro area costs about 30% in line loss! Yes, so Rick Gonzalez, Xcel's engineer, testified in Xcel's SW MN Certificate of Need proceeding. When you have that level of line loss for a generator with a 41% capacity factor, that's a problem, and those wanting to site projects in SD and ND better look at that distance and the increased line loss. It's not technologically efficient and wouldn't be a good investment!

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Dan_FehlerFeb. 22, 08 8:22 AM

The more investment into wind power, the cheaper the technology and engineering will become. Right now that's the big hurdle. If the finances are working for subprime locations, then the price points will drop when the prime locations are built up.

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davidwieFeb. 22, 0810:06 AM

If we want the power close to the lines, what if we used people power instead of wind? If we could design an exersize area in our schools that drove the turbine we could make a difference in both energy and obesity. Part of the PE curriculum could be a certain number of Watts delivered from each child. Funding could be based on output for the school. Better yet lets put them in prisons and sentence people to a number of Watts instead of time. The harder they work the faster they get out. In a large prison you could have 1,000 bikes going for several hours a day.

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