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"This is the exact scenario that we've been aggressively working with public power for the last three years to avoid," said John Hansen, president of the Nebraska Farmers Union.
Hansen and others are concerned that such projects will siphon potential profits from wind energy to out-of-state developers, rather than keeping them with Nebraskan landowners.
The project is the latest flash point in a long-standing debate over how wind energy should be developed in Nebraska, the nation's only public-power state.
Mike Donahue, executive vice president of the Chicago-based Midwest Wind Energy, said the company has had negotiations over the project, proposed for northwest Holt County, with the Nebraska Public Power District.
He hopes to the 100-megawatt plant's power to Nebraska utilities, because although the plant would be less than 15 miles from South Dakota, transporting power would be too expensive.
"If we wanted to sell out-of-state, we could," Donahue said. "But it wouldn't make economic sense."
Still, Hansen is concerned that the plant and others like it would undermine the state's public utilities. Though the wind power would be transmitted on NPPD lines, he said, the profits from its development would be headed to companies in other states.
Donahue refuted the idea that his company's plant could threaten public power, saying that its negotiations are subject to the approval of NPPD and the state Power Review Board, which won't agree to something that's not in their best interest.
NPPD spokeswoman Beth Boesch said the discussions are still early, and a purchase proposal stating pricing and a timetable are expected this week. But regardless of the project's specifics, she said NPPD would make sure to fulfill the public-power mandate of providing its customers with the most inexpensive power possible while pursuing renewable energy.
"NPPD and our board of directors will take any step we can to make sure that this project does not undermine public power in this state," Boesch said.
Hansen is not opposed to allowing private parties to develop wind power in Nebraska, but he advocates a community-based model that allows landowners to keep their wind-development rights as the best way to do it.
A trio of bills that would stimulate such community-based projects is stuck in committee, despite "priority bill" status on the centerpiece (LB629) from its sponsor, state Sen. Cap Dierks.
State Sen. Annette Dubas of Fullerton, who also supports the community-based model, said she's also concerned about who will benefit from the project.
"There's another economic development (tool) that's going out of state," she said. "And that's raising some red flags for me."
Dubas said she's also worried about reports from landowners in several Nebraska counties, including Boone and Custer, who have cheaply sold their wind-development rights to private developers.
She said she has talked with the state Attorney General's office about issuing a consumer alert. Hansen said he'd like to see all such agreements reported to that office as well.
State Sen. Deb Fischer of Valentine, whose district includes the site of the proposed plant, discounted fears about hasty wind-rights sales.
"I think property owners have a pretty good idea of what their property's worth and what people might want it for," she said.
Larry Flowers, a team leader at the nonprofit National Wind Technology Center, said Nebraska is facing the same the question that public utilities in many other states have faced in wind development: Is it better to buy power or generate it yourself?
Each option has its pluses and minuses, he said. Generating a utility's own power would eliminate a third party's price markups, but private groups are eligible for valuable federal tax credits that public organizations can't receive.
For Fischer, there's a lot of questions about price and legality that need to be cleared up, but for now, she's cautiously optimistic because of the eight permanent jobs the plant is expected to provide.
"There's a lot of potential, but we need to be cautious about it," she said, "because Nebraska is a public-power state, and every citizen in the state is affected by those decisions."
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