Integrating wind power into your operation

PHOTO BY KATHY EYSTAD, AGRICULTURAL RESEARCH SERVICE.
Standing in front of a wind turbine that provides half the annual electricity for the University of Minnesota Morris, Electrical Engineer Steve Wagner (right) and Agricultural Economist Dave Archer look at a map they developed for identifying potential best-bet locations for wind turbines.

New crops don’t come along every day, especially ones that don’t require inputs, irrigation and manual labor. With federal assistance programs announced this summer, the time may be right to consider harvesting a new crop: wind.

Wind energy basics

Experts believe that wind energy can play an important role in supplying the U.S. with power. Not the ultimate answer, wind can supplement other resources to help balance the use of less renewable and nondomestic supplies. A goal of wind providing 20 percent of the nation’s energy by 2030 has been set, and meeting that mark would translate into more than $600 million annually for rural landowners.

During 2008, the wind generating capacity was increased by more than 50 percent, bringing it to 25,300 megawatts, enough to power about 6 million homes. No other energy resource saw that growth level. Most states are outfitted with wind plants, with the greatest activity in Texas, Iowa, California, Minnesota and Washington.

There are at least three ways for growers and rural landowners to be involved in the wind industry: leasing acreage to a wind developer, operating a community wind farm or harvesting for your personal home and farm use. In any of these scenarios, your site must meet some basic requirements. Without an average wind speed of 11 to 13 miles per hour (wind class 3), a project isn’t feasible. The area needs to be clear of trees and obstructions and higher than surrounding structures.

Jason Perdion, an attorney specializing in environmental law, says it’s important to determine if your property is compatible with a wind project. If wetlands, historic sites or airports are in close proximity, careful investigation of requirements and ramifications is needed.

“It can be complicated,” he adds. “Depending on the size of the project, there can be several layers of state, federal and local permitting requirements.”

While many crops, as well as livestock, are compatible with wind turbines, consult with industry experts to ensure that your particular crops can coexist with the 200 to 300-foot towers.

Land leasing how-tos

Leasing land to a wind developer supplies you with an additional revenue stream, without investing in capital and maintenance costs; this is the avenue most interested parties are taking. About .5 acre per turbine is needed; annual lease payments may run between $2,500 and $5,000 per machine. Sometimes, 2 to 4 percent of gross revenue or a flat sum per megawatt of capacity (typically $3,000 to $4,000) is offered.

The lease documents are lengthy, technical and may obligate your property for up to 150 years, so seeking legal counsel is crucial. It is vital to have a clear understanding of:

  • The developer’s business structure, experience and financial viability;
  • The developer’s record with other projects;
  • The precise plans for your land: number and megawatts to be generated and total acres used, including unencumbered areas, to whom the power will be sold and starting date;
  • The project plans for wind assessment, transmission interconnection study and other evaluations;
  • Transmission interconnection plans, including route, new construction and rights-of-way;
  • Exact lease specifications, including term, compensation, fees and your rights to conduct your own wind, solar or mineral projects on your property.
  • Operating a wind farm

A community wind farm can be established by one or more individuals or organizations to produce local power. An entity owning viable land is responsible for financing and developing the farm (along with ultimate construction and maintenance), steps that a developer handles when land is leased. The highlights of the process include these phases, according to Windustry (www.windustry.com), an organization promoting the resource:

  1. Plan and manage your project and its goals. Identify areas in which a wind consultant should be engaged. Determine business structure, financing, risk factors and timelines.
  2. Conduct feasibility studies. In addition to wind assessment, estimate electrical production and financial viability. Assess the site for adequate acreage, suitable topography, wildlife concerns and community compatibility.
  3. Secure permits, easements and proper zoning. Determine which federal, state and local permits are required. Conduct community meetings and submit paperwork. Determine and secure right-of-way easements.
  4. Establish financing. Investigate loans, grants, tax incentives and selling renewable energy credits.
  5. Estimate costs. These include insurance, turbines and interconnection costs. Windustry says that the costs for a commercial-scale wind turbine in 2007 ranged from $1.2 million to $2.6 million per megawatt.

Producing your own power

Using wind to fully or partially power a home or farm is far less costly, although it may take many years to realize a return on the investment. A 10-kilowatt turbine is adequate for an average home and carries a price tag of $35,000 to $50,000.

Consult with electricians, your local utility and municipal officials to ensure the process, a scaled-down version of developing a commercial or community project, is smooth.

To determine if a home or farm wind turbine is economically efficient, use this formula to calculate the period required to recoup the investment:

Number of years = (sum of installed costs and ongoing costs)/[(energy produced) x (rate compensated for energy by utility company)].

COURTESY OF U.S. DEPT. OF ENERGY.
Is your region windy enough to provide a new revenue stream?

Assistance programs

To support the wind industry and encourage its growth, a number of federal and state incentives are available, including new programs introduced this summer.

According to a news release, on July 15, Department of Energy Secretary Steven Chu announced plans to provide up to $22 million from the American Recovery and Reinvestment Act (ARRA) to support the planning and installation of utility-scale community renewable energy projects (including solar, wind, biomass and geothermal systems) in up to four communities nationwide. Applications were accepted through September 3, with awardees to be named in November. Earlier, $93 million in ARRA funds were allocated to research and development in the field.

Some qualify for federal Renewable Energy Tax Credits, although legislators say that the benefit doesn’t extend to some rural landowners. Efforts were underway at press time to remedy that.

State incentives include credits for capital expenses and use of wind turbines, along with grants and loan guarantees. A database of state programs is available at www.windustry.org/database-of-state-incentives-for-renewables-and-efficiency.

A wealth of information, checklists, calculators and models are available online. Visit the government’s wind power site at www.windpoweringamerica.gov/agricultural/index.asp, Windustry’s Web site, the American Wind Energy Association at www.awea.org and the USDA’s national agricultural library at http://afsic.nal.usda.gov. Contacts for wind consultants and turbine suppliers are available on Windustry’s Web site.

Based in Greensboro, N.C., the author writes articles about horticulture, landscaping, agriculture and travel. She has been a contributor to Moose River Media publications for three years.