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Farmers can reap benefits from wind

(Tuesday, Dec. 9, 2003 -- CropChoice news) -- David Bennett, Delta Farm Press: Sometimes disparate events converge to provide positive change. To wit: as the price for imported oil becomes increasingly steep (both monetarily and as it relates to national security) Americans look longingly to alternative energy sources. At the same time, farmers find themselves at the mercy of markets, volatile weather and impatient creditors.

These two factors -- needed energy and needed farm income -- have led men to jab massive pinwheels into the spine of U.S. farmland. We are harvesting the prairie wind, turning breeze into sizzling, blue sparks.

As the energy bills being debated in Congress, Dan McGuire was busy making presentations to politicians and farmers both. "We've got to get this done right," says the CEO of the American Corn Growers Foundation. "Rural America needs help and a good energy bill can provide it." (An energy bill conference report failed to pass the Senate for lack of two votes to cut off a filibuster. Proponents say they will bring the bill back up when Congress returns in January.)

McGuire and others like him want policy makers to know about energy alternatives -- wind, bio-diesel and ethanol. "Wind energy has tremendous possibilities. It could displace a lot of the need for using high-priced natural gas. That would have a ripple effect in farmers' favor. With lower natural gas prices, fertilizer would be cheaper, especially nitrogen."

McGuire (also on the Ag Outreach Committee of the National Renewable Energy Laboratory and U.S. Department of Energy) says there is spiking interest in wind turbines from a variety of groups around the country. Farmers too are behind the push.

"Last April, we did a poll of 511 corn farmers in 16 states representing 90 percent of U.S. corn production. There is 70-80-90-percent support for everything from the production tax credit to grants and loans for renewable energy. Farmers want to provide this option."

When looking at the cost of new electricity plants -- whether coal-fired, natural gas or nuclear -- wind not only competes, but the cost is all up front, says McGuire. Wind itself is obviously free. What you must pay for is the initial investment of the turbine.

"Once that's paid for, there's a stable price that you can figure on in, say, a 20-year power purchase agreement with an energy company," he says. "Energy companies like that -- they're dealing with a power source that's a fixed cost as opposed to the fluctuations in the oil and natural gas markets. From that point of view, wind is absolutely competitive with other sources of power."

By 2020, proponents want at least 5 percent of U.S. electricity to come from wind energy.

Getting involved

And farmers are interested because they need new income streams.

"Currently, we're seeing strong soybean prices because of a short crop. Corn prices are also moving up," says McGuire. "But in a normal year, Nebraska farmers can expect corn around $1.80 and soybeans between $3 and $4. That's not profitable enough and wind energy offers additional income."

Typically, McGuire says farmers lease their land to a project developer for between $2,000 and $4,000 per turbine annually.

"As an example, there's a project developer in Minnesota named Dan Juhl. He has a 320-acre wind farm that he's got 17 turbines on. He leases that land from farmers who have continued to farm all around the turbines."

Farming -- row crops or livestock -- around the turbines isn't a problem. The turbine's "footprint" and road to get to it, take up a sixth of an acre. The towers, often several hundred feet high, are made of steel and concrete and crops push up against them.

"It's amazing how many wind turbine projects are going up," says McGuire. "Juhl is continuing to install them in some of the poorest counties in Minnesota. Iowa also has a great number of projects. That's nothing but positive for farmers. Their communities are being impacted by construction jobs becoming available, and farmers have more money to spend in town."

Currently, there's a federal production tax credit for wind energy -- 1.8 cents per kilowatt hour. An extension of that is included in the energy bill.

Some states also provide incentives for wind energy. For projects under 2 megawatts, Minnesota has a production incentive of 1.5 cents per kilowatt hour.

"We like the model where turbines are locally owned," says McGuire. "But they're expensive."

For that reason, corporations often become equity partners with farmers by putting up cash to build. The company is then able to garner the production tax credit.

Normally, the first 10 years of a turbine's life is used to pay off a farmer's debt. After that, the farmers start making most of the money -- instead of the banks or company partners."

McGuire points to another Juhl Minnesota project consisting of two NEG Micon 750-kW turbines. The turbines were built for $850 per kilowatt. The project will yield between $30,000 and $40,000 yearly for the first decade of operation. After that, depending on the amount of electricity produced, it's expected to generate between $110,000 and $130,000 annually for the farmers.

The lay-out

Until McGuire actually saw a wind farm, he was skeptical of their effectiveness.

"My education occurred quickly. I'm telling you, this technology is tremendous. There is often a misconception these turbines are noisy. They're not at all."

As far as the ability of the turbines to provide electricity at a relatively low cost, technology has evolved at a fast clip. Government and private research has brought the cost of producing a kilowatt hour of wind turbine electricity from 40 cents in 1979 to 12 cents about a decade ago to around 3 cents now. The cost is headed down to 2 cents by 2020.

In setting turbines up, is it taken into account that wind might be available one year and not the next?

"It is. Part of the development agreement is typically a year's worth of wind research data," says McGuire. "There are companies who gather this data. Financial lenders usually require it."

By knowing what wind speed is at 10 feet above ground level, wind speed at 200 feet high can be extrapolated. The difference is significant. Obviously, there are fluctuations in the wind, says McGuire, but historical research will show whether or not there is a steady, reliable supply.

Geographically, the prairie states in the Midwest are ideal for catching wind. Not so the majority of Delta territory. But there are wind pockets in parts of nearly every state, says McGuire.

The U.S. Energy Department's Wind Resource Map shows several swaths of land in central and northwestern Arkansas with Class 2, 3 and 4 winds. Class 4 wind is considered "pretty darn good," says McGuire. "Indeed, a wind turbine was installed this year at Prairie Grove Industrial Park in Arkansas. It's a small one, but it's there. Arkansas is ranked 27th in wind capacity. You've got as good a wind resource in some areas as northern Nebraska."

Eastern Tennessee and parts of southern Missouri also hold promise for turbines.

Other pluses

Wind will never replace all other power plants. But the turbines can be a significant percentage of the nation's electrical supply. Following the massive eastern power outage earlier this year, McGuire points out there is no known instance where wind energy caused a lack of power by not blowing.

And there are other benefits for rural residents.

"If you look at rural areas, there is a lessening of electrical quality as you get further away from the power plants. As you get towards the end of the line, you essentially lose power. Who's at the end of those lines? Rural America.

"So, by putting the turbines out on farm land, you take pressure off load centers. Experts will tell you this. Our nation has a fairly old grid system and this is one way to address that. Wind energy has just come along at the same time the grid upgrade needs to be done."

The turbines are also bringing together farmers and environmentalists, not always the friendliest of pairings.

"Environmentalists are encouraged by this. They like the idea. I've spoken at bunches of seminars and conferences on this, and there appears to be a great coalition of producers and environmentalists on this issue. Strange bedfellows in many ways, but it's working."

Environmentalists are happy because by utilizing turbines 35 million tons of carbon can be kept from the atmosphere by 2020. Yearly avoided emissions from the two-turbine Minnesota project described earlier are 4.8 million pounds of carbon, 25,000 pounds of sulfur dioxide and 15,000 pounds of nitrogen oxides.

"Even one of these wind farms makes a substantial contribution to removing atmospheric carbon. And you're generating jobs and income at the same time you're displacing power sources that are polluting. That's a win/win for everyone."