The Ohio Power Siting Board has approved plans for another 764 commercial wind turbines, but state rule changes and federal tax policy have most of them in limbo now.
The Ohio Power Siting Board has approved plans for another 764 commercial wind turbines, but state rule changes and federal tax policy have most of them in limbo now.
Wind-energy development in Ohio has entered a long and sometimes agonizing limbo.
State regulators have approved 11 projects that have yet to install a single wind turbine.
Developers say the projects — which would more than triple the state’s wind-energy output — are alive, despite state laws passed this year that some of the same companies said would kill investment.
At the same time, local residents say they are stuck waiting to see what will happen with proposed projects in their communities. This includes people who support and oppose the turbines.
And all sides are watching a federal debate about whether to renew a tax credit that, if discontinued, would be a serious blow to project financing.
“The projects are not dead, but I …
... more [truncated due to possible copyright]Wind-energy development in Ohio has entered a long and sometimes agonizing limbo.
State regulators have approved 11 projects that have yet to install a single wind turbine.
Developers say the projects — which would more than triple the state’s wind-energy output — are alive, despite state laws passed this year that some of the same companies said would kill investment.
At the same time, local residents say they are stuck waiting to see what will happen with proposed projects in their communities. This includes people who support and oppose the turbines.
And all sides are watching a federal debate about whether to renew a tax credit that, if discontinued, would be a serious blow to project financing.
“The projects are not dead, but I think it will be very challenging to see any of these projects built in the near term,” said Dayna Baird Payne, a Columbus-based lobbyist whose clients include the American Wind Energy Association.
The Ohio Power Siting Board, a panel that reviews and certifies the plans, has given its approval to 11 wind farms with a combined 764 turbines. Together, the projects would generate a projected 1,401 megawatts.
This would be a notable increase for a state that now has two utility-scale wind farms, with 215 turbines and 450 megawatts. The most recent to come on line was Blue Creek Wind Farm in Paulding and Van Wert counties, which was completed in 2012.
Almost all of this activity is in an area northwest of Columbus, running all the way to the Indiana border, where the wind is the most brisk and there is easy access to interstate power lines.
“The people who live in or near one of these projects are in limbo,” said Michael Shepherd of Belle Center in Logan County, who lives within view of the proposed Scioto Ridge Wind Farm. “They don’t know what’s going to happen. Should I move? Should I sell?”
He is owner of Six Hundred Downtown, a pizza restaurant in the nearby county seat, Bellefontaine.
The Scioto Ridge project has turned him into an activist, hoping to limit the effects of a project that would put six turbines within a half-mile of his house. The turbines would become an omnipresent part of his home life, but he would receive no royalties because none of the towers is on his property.
Other residents and business leaders share his frustration with the lack of activity, but for the opposite reason. They are eager to see the investment, tax payments and royalties.
“We’re sitting here wasting four or five years of opportunities,” said Jon Berry, a farmer in Union Township in Champaign County who would get two turbines near his house if the Buckeye Wind Farm gets built.
He has visited wind farms and doesn’t see the turbines as a nuisance. And yet, some of his neighbors say the turbines would be an eyesore and raise concerns about the flicker and noise.
“It’s going to be like religion or politics,” he said, about how he interacts with neighbors who oppose the plan. “If you disagree about it, you don’t bring it up.”
Projects at risk
Energy developers have watched this year as the Ohio General Assembly passed laws that help to reduce demand for wind power and increased the required distance between turbines and buildings.
“Sometimes there’s just too much to overcome,” said Michael Speerschneider, chief permitting and public policy officer for EverPower, the Pittsburgh-based developer behind three pending projects.
But his company is not yet ready to say the projects are in peril.
Demand for wind energy is down in part because of Senate Bill 310, signed in June. The bill places a two-year freeze on state standards for renewable energy and energy efficiency, and sets up a study committee that is looking at additional changes. Its supporters have said the state needs to move away from using mandates to favor one energy source over another.
Before the bill became law, the largest wind farms planned to sell much of their output to Ohio utilities under long-term contracts that would help pay for the projects. The new law means that utilities are much less likely to buy, at least for the next few years.
“For a project to get financed these days, you need to have a power-purchase agreement with a credit-worthy counterparty,” said Eric Thumma, director of regulatory affairs for Iberdrola Renewables, the company behind the Blue Creek project. “If you don’t have that, you’re going to take out a lot more risk.”
The risk is substantial, considering that Blue Creek cost about $600 million. A new project costs about $2 million per megawatt, according to the wind-energy trade group.
Of the 11 pending projects, the only one that has had recent construction work is Northwest Ohio Wind Farm in Paulding County. It would have 59 turbines and capacity of 100 megawatts, making it one of the state’s smaller projects.
The developer, Starwood Energy Group Global of Greenwich, Conn., has built access roads on the site and is preparing to install turbines, according to filings this month with the state.
The other 10 projects appear to be waiting, based on recent filings and interviews.
“The Hardin Wind project remains actively in development, and while power market conditions remain challenging for the sale of the project’s output, we continue to evaluate our best options for the facility,” Alissa Krinsky, a spokeswoman for Invenergy of Chicago, said in a statement.
The project in Hardin County would have 200 turbines and capacity of 300 megawatts.
Windlab Developments USA Ltd. is optimistic about the prospects of its Greenwich Wind Farm in Huron County, which would have 25 turbines and capacity of 60 megawatts.
Monica Jensen, Windlab’s vice president for development, said in an email that the project is "in the process of finalizing grid connection and working on an off-take agreement with a large, Ohio-based industrial customer who sees the long-term value of locking in their energy cost for the next 20 years.”
The 11 certified projects are not the only ones being discussed. Several other companies, including Apex Clean Energy of Virginia, are acquiring lease rights and working on plans but have not begun the potentially long and expensive process of seeking approval from the state.
Supporters and opponents of wind-energy projects are closely watching whether Congress will renew funding for the renewable-energy production tax credit. The credit, started in 1992 and expanded several times since, provides 10 years of tax savings for an eligible wind project.
President Barack Obama has proposed making the credit permanent, while key congressional Republicans have said they would like to reduce or eliminate the incentive.
The potential end of the credit, along with the recent changes in Ohio law, would be a painful combination, said the lobbyist Payne.
“It’s a big picture of uncertainty,” she said.