WIND AND OIL MIXING

Texas rancher describing the hum of wind turbines on his ranch: “That’s just money you’re hearing…” The rancher earns $500/month for each of 78 turbines on his “spread.” He is planning 78 more.

Famed entrepreneurial Texas oilman T. Boone Pickens: “I have the same feelings about wind…as I had about the best oil field I ever found.”

Nolan County in Texas generates so much wind that if it were listed among the wind-producing nations of the world it would rank 9th. Land values there have doubled and are expected to increase another 25% this year. Tim Fambrough, Nolan County judge: “Wind reminds us of the old oil and gas booms…”

Modern windmills are 20 stories high with blades the length of a football field and produce power in even mild winds.

Wind energy presently generates 1% of U.S. electricity. Skeptical energy authorities see it growing to 5-7% of the nation’s power supply. Industry advocates believe it can supply up to 1/3 of U.S. power by 2030.

From the NY Times. (click to enlarge)

Problems: (1) Wind energy in some places still costs more than coal- or gas-generated power; (2) wind energy is intermittent; (3) the hottest days, when electricity demand spikes, are typically not windy; (4) turbines can cause harm to birds and bats; and, (5) there are some complaints about interference to the beauty of the landscape.

Solutions: (1) Growing volume and the increasing cost of greenhouse gas emissions has made wind cost competitive in many markets and that trend will continue; (2) a recent study showed that linking 19 wind farms over a 500-square-mile area essentially negates intermittency and a variety of wind energy storage systems are emerging; (3) careful siting and structural and technical improvements are keeping harm to birds and bats below that caused by neighborhood cats or tall buildings; and, (4) careful siting and cooperation with environmental groups is keeping aesthetic complaints to a minimum while wind energy advocates regularly remind the complaining minority that the elegant turbines are infinitely preferable to the degradations of mountaintop removal coal mining or the ravages of climate change.

Jerry Patterson, Texas land commissioner, responsible for identifying Texas wind sites: “Texas has been looking at oil and gas rigs for 100 years, and frankly, wind turbines look a little nicer…We’re No. 1 in wind in the United States, and that will never change.”

Wrench in the works: The federal production tax credit (PTC) incentivizing wind development will expire at the end of 2008 and a recalcitrant minority in the Senate is blocking its extension.

Long term challenge: New transmission is needed to get the electricity from the wind farms to the the grid.

Move Over, Oil, There’s Money in Texas Wind
Clifford Krauss, February 23, 2008 (NY Times)

WHO
Famed Texas oil entrepreneur T. Boone Pickens; Robert Gramlich, policy director, American Wind Energy Association (AWEA); the Texas Public Utility Commission (TPUC)

The Texas panhandle has become one of the busiest wind energy production centers in the world. (click to enlarge)

WHAT
Texas, once synonymous with oil, now leads the country in wind energy production and continues to grow wind.

WHEN
- The Texas wind energy boom has been largely in the last 3 years. It bypassed California and became number 1 in the U.S. in 2006.
- Wind energy grew 45% in 2007. It is expected to grow as much in 2008.
- A recent study projects investment of $65 billion in wind energy between 2007 and 2015.
July 2007: TPUC approved transmission lines for up to 25,000 megawatts of wind energy by 2012.

WHERE
- Wind farms are being built on cattle ranches and in old oil fields.
- The U.S. recently overtook Spain and became 2nd in the world to Germany in wind energy capacity.
- Texas is 1st in wind, California 2nd, Minnesota 3rd, Iowa 4th. Iowa, Minnesota, Colorado and Oregon get 5-8% of their power from wind.
- 2/3 of wind in Texas is owned by foreign companies like Iberdrola of Spain, Energias de Portugal and Windkraft Nord of Germany.
- The best U.S. wind is in rural areas of the central corridor from the Dakotas to Texas while the need for electricity is in the cities.

Texas' independent grid system makes new transmission easier to develop. (click to enlarge)

WHY
- Texas now generates 2% of its electricity from wind energy.
- Texas has a perfect wind energy development environment: Good wind, few regulations, lots of private farm and ranch lands, fast-growing cities and big money.
- Texas’ independent grid makes it easier development new wind and new transmission.
- The TPUC-approved new transmission is expected to drive national wind energy development.
- Shell and the TXU Corporation are planning a 3,000-megawatt wind farm in the Texas panhandle, the biggest in the world.
- Pickens is planning a 4,000-megawatt $10 billion installation in the Panhandle.

The Texas landscape is wind energy-sized. (click to enlarge)

QUOTES
- Patrick Woodson, senior development executive, German utility and Texas wind developer E.On: “Texas could be a model for the entire nation…”
- Gramlich, policy director, AWEA: “We need a national vision for transmission like we have with the national highway system…We have to get over the hump of having a patchwork of electric utility fiefdoms.”
- Pickens: “I like wind because it’s renewable and it’s clean and you know you are not going to be dealing with a production decline curve…Decline curves finally wore me out in the oil business.”
- Bobby Clark, wind technician, General Electric: “I mean, even the worst days for wind [in Nolan County] don’t compare to the busts in the oil business…I saw my daddy go from rags to riches and back in the oil business, and I sleep better.”
- Marty Foust, owner, Dandy’s Western Wear (Sweetwater, Nolan County): “Wind has invigorated our business like you wouldn’t believe…When you watch the news you can get depressed about the economy, but we don’t get depressed. We’re now in our own bubble.”