A local company's plan to build a small wind farm just outside Madison is hanging by a thread amid a standoff with Madison Gas and Electric Co. over the price of electricity to be generated at the site. The company, Wave Wind LLC of Sun Prairie, says it needs 8 cents per kilowatt-hour to make the project viable. MGE is only willing to pay 2.9 cents.
A local company's plan to build a small wind farm just outside Madison is hanging by a thread amid a standoff with Madison Gas and Electric Co. over the price of electricity to be generated at the site. The company, Wave Wind LLC of Sun Prairie, says it needs 8 cents per kilowatt-hour to make the project viable. MGE is only willing to pay 2.9 cents.
A local company's plan to build a small wind farm just outside Madison and create more than 100 jobs is hanging by a thread amid a standoff with Madison Gas and Electric Co. over the price of electricity to be generated at the site.
The company, Wave Wind LLC of Sun Prairie, says it needs 8 cents per kilowatt-hour to make the project viable. MGE is only willing to pay 2.9 cents.
"That rate won't even allow us to put a shovel in the ground," said Tim Laughlin, president of Wave Wind at 4589 Highway TT. "The utilities have to recognize that (green power) will be part of the culture. It will be part of what we're dealing with on all levels, and they'll have to figure out a way to make it work."
Wind-farm supporters say the project - …
... more [truncated due to possible copyright]A local company's plan to build a small wind farm just outside Madison and create more than 100 jobs is hanging by a thread amid a standoff with Madison Gas and Electric Co. over the price of electricity to be generated at the site.
The company, Wave Wind LLC of Sun Prairie, says it needs 8 cents per kilowatt-hour to make the project viable. MGE is only willing to pay 2.9 cents.
"That rate won't even allow us to put a shovel in the ground," said Tim Laughlin, president of Wave Wind at 4589 Highway TT. "The utilities have to recognize that (green power) will be part of the culture. It will be part of what we're dealing with on all levels, and they'll have to figure out a way to make it work."
Wind-farm supporters say the project - which the company likely will move to another state if a deal can't be worked out - would produce clean energy for 2,400 homes annually, for just a few pennies more on a $50 monthly bill.
But MGE says it can get renewable energy even more cheaply now and potentially well beyond 2020.
Renewable energy expert Michael Vickerman agreed that locally produced wind energy wouldn't be the cheapest option, given competition from states like Iowa and Minnesota, which have stronger, steadier wind patterns.
But he said a local wind farm could still generate significant energy and would cost only "marginally more" than other sources, with benefits beyond dollars and cents.
"MGE has a customer base that is deeply committed to sustainable energy," said Vickerman, executive director of RENEW Wisconsin, a Madison nonprofit that promotes clean energy. "It sends a powerful signal to component manufacturers, to the construction and building trades, to local governments and to economic development officials."
MGE officials did not return calls for comment.
But according to a series of e-mails provided by Wave Wind, MGE CEO Gary Wolter told the company last week that the utility "was not in the market for additional wind resources at this time."
Wolter said MGE already has "sufficient energy" from its existing sources - primarily from wind farms in Iowa, where two-thirds of its renewable energy comes from - to meet its requirements under current state law until 2018, or until 2016 if more aggressive goals for renewable energy production are approved by state lawmakers.
And if MGE develops some new sites under its control, outside resources wouldn't be needed until "well beyond 2020," Greg Bollom, MGE's assistant vice president of energy planning, told the company via e-mail last week.
The $20 million, six-turbine development would generate nearly 10 megawatts, Wave Wind said. It would be built on farmland permitted for turbines off Highway 12 in the town of Springfield, about 15 miles northwest of Madison. It would contribute to the local tax base and create about 100 construction-related jobs for 15 local companies, plus at least 10 permanent jobs for workers to service the wind farm, Wave Wind said.
The company is spending $12 million for turbine parts built by its international partner in the project, Hyundai Heavy Industries of Seoul, South Korea. The turbine towers and other supplies would be purchased locally or regionally, and the wind farm would be operating by August.
Moving swiftly is important, company officials said, because Wave Wind will get a federal grant to cover 30 percent of project costs if 5 percent of the construction is finished by the end of this year.
Vickerman said MGE would need to increase rates by 0.3 percent over its customer base, which generates about $330 million a year, to raise the nearly $1 million it would need to purchase the electricity at the 8-cent rate Wave Wind wants. That would cost a customer with a $50 monthly bill 15 cents more.
Laughlin and Vickerman said an 8-cent charge was used to design the project because MGE agreed to pay 8.3 cents about two years ago when a previous developer tried to build a wind farm on the same site. That project fell through when the earlier developer couldn't come up with the money to buy the turbines, Laughlin said. Vickerman said a steep drop in natural gas prices since 2008 makes Wave Wind's project more expensive for MGE, because it's that much cheaper now for MGE to use traditional fuels rather than renewable energy to generate electricity.
By law, Wave Wind's project can only connect to the regional power grid through MGE, the service provider for that area. Once on the grid, the project's electricity could be sold to any wholesale buyer in the country, not just MGE, but Wave Wind said the fee it would be charged by MGE for that option would be too expensive.