Fate of wind energy rests on policy

Utilities, private contractors and entrepreneurs know how to build wind farms.

They can evaluate wind potential, negotiate easements with farmers and ranchers, construct 230-foot tall towers topped with 131-foot blades, and put electricity on the grid if there's access to transmission lines.

What they can't do is chart a clear path to the future for wind energy because it will be greatly influenced by decisions made in Washington, D.C. For now, there is no comprehensive national energy policy.

A big unknown for wind energy is possible legislation related to carbon and climate change, said Dave Rich, Renewable Ener-gy Development manager for the Nebraska Public Power District. He said much of today's wind energy development is a hedge against legislation that might put a carbon cap or carbon taxes on coal-fueled power plants.

Nebraska's largest power plant is NPPD's coal-fired Gerald Gentleman Station near Sutherland. In 2007, 57 percent of NPPD's overall energy was produced from coal.

Also unknown is future demand for electricity and whether wind energy can meet that demand. Rich said the push toward hybrid vehicles will create a huge new electrical load for the national grid.

The grid itself may not be capable of carrying greater loads without major transmission system improvements.

Rich said the key for Nebraska's wind industry is having transmission lines in place to move electricity around the state and export it to areas of the country where there are markets for any excess production.

He suggested that the national power grid needs a project similar to President Eisenhower's 1950s push for a national interstate highway system. More capacity could be built over the current electrical transmission system, Rich said, sort of like making a four- or six-lane interstate out of two-lane roads.

Another wind energy development issue is the tax credit structure.

Rich said public power districts, which are a relatively small segment of the power industry nationwide, can't qualify for current tax credits and other incentives for new construction of wind farms. Private enterprises can get tax and depreciation credits that ultimately could equal one-third of a project's cost.

NPPD has 20-year contracts to buy electricity from Nebraska's two wind facilities being built by private developers near Bloomfield and Crofton.

Construction costs for wind energy were increasing even before the current credit crunch because of high steel prices, according to an NPPD brochure.

When asked if wind is a realistic part of our energy future, Rich said it's a hard question to answer without knowing where Congress is going with energy policies and regulations.

"The encouraging thing about wind is that states are putting up new power plants ... and wind is pretty darn competitive in the long run," said Callaway rancher Jim Jenkins, who also is a contractor helping NPPD contact landowners at Nebraska sites identified as having potential for wind farms.

"Wind is not perfect," he added, because it's intermittent and needs a backup system. "What I tell people is that nothing is perfect.

"Most of us understand that we have to diversify our energy portfolio."

On the Net

-www.nppd.com/wind_generation
-www.neo.ne.gov/renew/wind.htm

Wind Energy Issues

-Cost compared to current generation
-Possible future carbon taxes and caps
-Transmission capacity