What could become the world’s largest wind farm is being treated like something of a sure thing after the Obama administration this week declared the Chokecherry and Sierra Madre Wind Energy Project site in Wyoming suitable for development. But here’s a question: Will they build it if there’s no production tax credit in place?
The Anschutz Corporation, through an LLC called Power Company of Wyoming (PCW), has been working since at least 2008 on plans and approvals for the project, which could see up to 1,000 turbines putting out 2,000 to 3,000 megawatts of electricity in south-central Wyoming and sending it to population centers in the Southwest.
This week’s federal approval of the project’s basic components – two huge clusters of wind-turbines, about nine miles apart in Carbon County, with their attendant infrastructure – gave the administration the opportunity to crow about its politically popular and, to be sure, remarkable achievements in advancing renewable energy development.
“President Obama challenged us in his State of the Union address to authorize 10,000 megawatts of renewable energy on our public lands by the end of the year – enough to meet the needs of more than 3 million homes – and today we are making good on that promise,” U.S. Department of the Interior Secretary Ken Salazar said in a statement.
Salazar’s Record of Decision for the project [PDF] doesn’t free the developer to go hog wild on the area authorized for development: “Additional environmental reviews will be needed for the specific turbine layout,” the Interior Department said. And the Bureau of Land Management, Interior said, “will continue to engage stakeholders as these additional reviews are carried out.” Plus, the project must pass muster with the Wyoming Industrial Siting Commission.
Nevertheless, the Salazar decision sets the wheels in motion for “the BLM to proceed with site specific environmental analysis for the Sierra Madre Wind Farm, the Chokecherry Wind Farm, the internal haul road, the internal 230 kilovolt transmission line, the rail distribution facility, and substations to connect the generated power to the electric grid,” the department said.
Apparently sensing that employment just might be an issue that resonates with Americans these days, the administration touted the job-creating benefits that could flow from the Wyoming project, which figures to unfold in stages over several years.
“At peak construction, project developers believe the project will create an estimated 1,000 full-time jobs; when operational, the facility is expected to employ 114 permanent workers,” the Interior Department said.
On page 2: The hurdles that Chokecherry and Sierra Madre could face.
One issue not raised in the Interior Department’s statement — nor in a press release put out by PCW — was how the project’s fate might or might not be intertwined with the production tax credit, a 2.2 cents/kilowatt-hour subsidy for wind that will expire on Jan. 1, 2013. Even now, projects that won’t be in operation before the end of the year are being shelved. Jobs in the industry supply chain are being slashed. Will Chokecherry and Sierra Madre go forward without the PTC?
Asked that question, a spokeswoman for the developer told EarthTechling, via email: “We’re still focused on the permitting and development phase. PCW is committed to completing the remaining federal, state and county permitting processes, and whether PCW’s project will be built depends on a number of factors, including overall economics at that time, which must consider and reflect federal and state tax policies, the state of the market, etc.”
Make of that what you will.
Another outstanding question about this project: Where will the electricity produced at Chokeberry and Sierra Madre go, and how will it get there? The expectation is that utilities in California and elsewhere in the West, spurred by state renewable portfolio standards, will contract for the power. The release by the PCW alluded to that possibility. “The Record of Decision milestone moves us closer to having bulk supplies of clean, cost-effective electricity available to serve nearly 1 million U.S. homes – and in a timeframe well ahead of the RPS targets set by California and other Western states,” said Bill Miller, PCW president and CEO.
But as Chris Clarke has detailed on the ReWire blog, California has refined its RPS to make it more difficult for projects from out of state to gain regulatory approval. The state might have needed big projects from surrounding Western states in the early years of the RPS, but in the last few years it has approved dozens of projects within its own borders. “The pipeline of projects seeking future approval is robust,” Gov. Jerry Brown’s renewable energy advisor told Western grid players last year, in a letter [PDF] that essentially warned out-of-state developers that California might not be needing their power.
And Nevada? Well, the Reno Gazette-Journal reported this week that Nevada’s clean energy players fear a lack of in-state demand could become such a problem, they’ll need to find ways to export electricity. That wouldn’t be good for PCW and Anschutz, its parent, which, by the way, has a subsidiary, TransWest Express, that is aiming to build the “extra-high-voltage direct-current electric transmission system” that would connect the Wyoming site to the Desert Southwest. The Obama administration is strongly backing that project, but it’s a huge undertaking, a 725-mile line, still making its way through the regulatory thickets itself.