Texas still No. 1 in wind power, but challenges loom

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Wind turbines in action Tuesday, Oct. 27, 2015, north of Stanton, Texas. James Durbin/Reporter-Telegram

Over the last decade, Texas has led the nation in wind energy and, for now, the growth shows no signs of slowing down.

The American Wind Energy Association came to General Motors’ Arlington Assembly plant on Thursday to tout the industry and the factors that have made Texas the nation’s top wind state. Thursday, North Carolina became the 41st state to have an operating wind farm.

Despite the rosy picture, industry officials are casting a wary eye toward Washington to see which way the political winds are blowing with the Trump administration.

Tom Kiernan, chief executive officer of the association, said since wind is low cost, provides jobs and is being used by many American companies like GM, it should be a good fit with many of President Donald Trump’s goals.

I think, I hope, wind will work for the Trump Administration.

Tom Kiernan, CEO of the American Wind Energy Association

“I think, I hope, wind will work for the Trump administration,” Kiernan said.

In Texas, it’s booming.

The Lone Star state, with 20,321 megawatts of installed wind power capacity, is easily the nation’s leader, surpassing the combined capacity of No. 2 Iowa and No. 3 Oklahoma, according to a fourth-quarter market report compiled by the trade group.

One recent development has been companies like General Motors making long-term commitments to wind energy.

The Arlington plant, which assembles 1,000 SUVs daily including the Chevrolet Suburban, Chevrolet Tahoe and Cadillac Escalade, is already 50 percent powered by wind energy and will have 100 percent of its energy needs served by wind power by 2018.

That will make the Arlington plant GM’s first factory to be fully powered by wind. GM is getting its wind energy from RES’s Cactus Flats in Concho County and EDPR’s Los Mirasoles Wind Farm in Edinburg.

Wind is now the cheapest option even when it is unsubsidized.

“Wind is now the cheapest option, even when it is unsubsidized,” said Rob Threlkeld, GM’s global manager of renewable energy. Threlkeld estimated GM saved $5 million in energy costs during the last year by using renewables, but it is too early to say how much it will cut electricity expenses at the Arlington plant.

In November, General Motors announced that it was buying enough wind power to serve the energy needs at 16 facilities across the country, including the one in Arlington.

Other companies such as Facebook and Amazon have also jumped on the wind bandwagon. The big Facebook data center under construction in far north Fort Worth will be powered by wind, while Amazon announced plans to build a wind farm in Scurry County, in West Texas, to provide energy for fulfillment centers in Haslet, Fort Worth, Coppell and Dallas.

One advantage is the ability to lock in a fixed price for energy rather than dealing with volatile energy sources such as natural gas.

For Texas, the state’s lead in wind energy is only expected to grow.

Wind power provides 25,000 jobs in Texas, from technicians who maintain turbines to factory workers who build components.

In the fourth quarter of 2016, Texas led the nation with 1,790 megawatts of wind power installed and the state also has the most capacity under construction with 5,401 megawatts, the report said.

Many speaking at Thursday’s event gave credit to the state’s $7 billion investment to build the Competitive Renewable Energy Zone, which erected massive transmission lines to bring wind energy from West Texas to population centers in the eastern half of the state.

One megawatt can power about 200 homes during peak conditions and about 500 homes during milder demand, according to ERCOT, or the Electric Reliability of Council of Texas, which manages about 90 percent of the grid in Texas.

But there is some blowback to wind power.

Trump famously railed against Scottish wind farms near his golf course in Scotland. But officials hope that former Texas Gov. Rick Perry, the nominee for secretary of energy, will provide some help. He was in office for the Texas buildup of CREZ transmission lines, which gives the industry hope.

The Trump administration’s Top 50 list of infrastructure projects, which was obtained by the Star-Telegram’s parent company, McClatchy, includes wind and transmission line projects helpful to the industry.

In Texas, some opposition has come from landowners who oppose new projects because they mar the landscape.

The state’s Chapter 313 tax abatement program, which helped fuel the wind-farm growth, has also been getting increased scrutiny.

Texas Comptroller Glenn Hegar’s biennial report on tax exemptions forecast that the Chapter 313 program, which temporarily lowers taxes paid by a business in exchange for providing economic benefits such as jobs, will cost local school districts about $326 million in 2016 but could climb as high as $1.1 billion in 2022, according to the Houston Chronicle.

Wind projects comprised 144 of the 309 Chapter 313 tax abatements in the state, the Chronicle reported.

Legislation has been proposed to limit wind turbines near military installations, the Star-Telegram reported last week. Sen. John Coryn and U.S. Rep. Blake Farenthold, R-Corpus Christi, have introduced bills that could impact wind farms built near military installations.

The wind industry hopes any issues with wind turbines interfering with radar at military installations will be handled on a case-by-case basis rather than a uniform 25- or 50-mile ban on turbines near bases, said Jeff Clark, executive director of Austin-based Wind Coalition.

Another challenge is that wind doesn’t always blow when energy is needed the most. In Texas, the highest energy usage tends to come on scorching summer afternoons when there is often very little wind blowing in West Texas.

But Kiernan said having more wind farms in South Texas helps mitigate those issues.

“When the wind isn’t blowing in West Texas -- guess what? -- it’s ripping at the other end of the state,” Kiernan said.

Congress has extended the production tax credit for wind, but it is set to phase out by 2020. The Wind Coalition’s Clark said that wind energy can stand on its own but points out that the oil and gas industry has access to tools like the master-limited partnership, which can provide tax benefits for investors, that the wind industry does not.

source: http://www.mrt.com/