Tilting at Windmills: Wind Power in the Twenty-First Century. October 6, 2012

Transcription

1 Tilting at Windmills: Wind Power in the Twenty-First Century October 6, 2012

2 Tilting at Windmills

3 Wind Tex Energy, LP Developed 4 projects currently in operation in Texas. These comprise 5-10% of current Texas Wind Energy. Sold 5 th project in 2011 to E.On. E.On expects to begin construction of the MW Petronilla project in Sold 6 th project to CCWE. This 63MW CIRRUS project is in construction and expected to be in commercial operation by December Jointly developing a 7 th project, Stephens Ranch. Construction of this 377MW project is expected to begin in December 2012, with commercial operation in November Have looked at or currently exploring projects in: Uruguay Caribbean

4 Wind Energy in the United Kingdom, the United States, and Texas International Rankings as of 12/31/2011 Country Wind Power Capacity (MW) China 62, U.S. 46, U.K. 6, % World Total

5 Wind Energy in the United Kingdom, the United States, and Texas (cont.) U.S. Rankings as of 12/31/2011 Country Wind Power Capacity (MW) Texas 10,648 1 Iowa 4,400 2 California 4,287 3 U.S. Ranking

6 Development Land Acquisition Purchase Lease Term Development Construction Operation Economic Terms Royalty / Fixed Amount Other payments Development Commercial Operation

7 Development (cont.) Amount of Land Needed 60 acres for each MW installed 5% land use by wind turbines versus 100% land use by solar production 750 meters between rows of turbines 250 meters between individual turbines

8 Development (cont.) Determining which land to use Windy! Rows perpendicular to wind On coast Ridges Front side turbulence Backside acceleration Offshore Water depth Shipping lanes

9 Development (cont.) Other issues Constructability Transmission lines Roads / Harbors Environmental issues

10 Tap-In Line Purpose Size Acquisition Purchase Lease Easement

11 Wind Analysis Preliminary Analysis Cost Time Gathering Wind Data Meteorological Tower Cost Erection Size Equipment Anemometers Recording Data Data Retrieval SODAR Unit How they work Cost: $65,000-$75,000 Collection Period

12 Wind Analysis (cont.) Final Wind Analysis Objective Necessity Cost Components Long term wind speed Identification of correlating stations Optimum turbine Turbine layout Micrositing

13 Transmission Analysis ERCOT Securing ERCOT (Grid Operator) Transmission Service Provider Steady state analysis Short circuit analysis Stability analysis Facility study Interconnection Agreement What can connect? Size project Type of turbine Cost to connect Infrastructure improvements Security, timing, returned after commence operations Time to connect

14 Transmission Analysis (cont.) Competitive Renewable Energy Zones (CREZ) Texas Public Utility Commission recognized problem and took action CREZ increase in Texas wind capacity 6,903 MW to 18,456 MW (increase of 11,553 MW)

15 Transmission Analysis (cont.) CREZ Zones

16 Transmission Analysis (cont.) General Factors Capacity of Transmission Lines Size of lines Quality of lines Electrical System US v. Europe Type of turbine Distance from load

17 Environmental Issues U.S. v. Texas 4-Season Avian Study Intensity dependant on the area (Texas Gulf Coast versus West Texas) Beach Ridge Project (Bat issue) Goodhue Project (Bald Eagle issue) Soil & Water Issues Hazardous Material Sites

18 Environmental Issues (cont.) Rerouting

19 Environmental Issues (cont.) General Principles Are there environmental laws that will be impacted by the construction of a wind farm? What is the process for compliance with those laws? Cost Time Government discretion in law implementation

20 Local Issues Noise Viewshed Property Values N.I.M.B.Y.

21 Cultural Assessment How to deal with

22 Permitting U.S. State (Texas) Very Little Permitting No State No County No Municipal As a result leads the country FAA Four Corner No Hazard-potential radar impact (military) Kingsville Microwave Path General Factors What permits are required? Cost Time Discretion

23 Financing Expense Side Cost to Build Project Engineering, Procurement, and Construction Turbines Size Manufacturer

24 Financing (cont.) Expense Side (cont.) Cost to Operate Project Taxes Maintenance and Repairs Staff Debt repayment Landowner Payments

25 Financing (cont.) Revenue Side Sale of Energy Texas PPA Hedge Merchant Other Caribbean Feed in Tariff Environmental Attributes Renewable Energy Credits Carbon Credits

26 Financing (cont.) Tax Issues Income Tax Property Tax Custom Duties Tax Incentives Treasury Grant Production Tax Credit

27 Construction Economic Boom Construction Process Roads-60 feet to 20 feet Foundation Different Designs 8 feet of concrete Bolts Turbine Erection Tower-3 Sections Turbine-79 to 90 Tons Blades Seimens 3.0 MW 10.3 Tons 49 Meters Long Hub Height 80 Meters Cranes

28 Construction (cont.) Underground Lines Purpose 100 MW-6 miles of cable Depth buried Substation Operations & Maintenance Facility Overhead Lines Tower size Voltage of line Space between towers Example: feet Time to Construct

29 Turbine Layout

30 Office Complex & Laydown Yard

31 Bolt Cage Installation

32 Plowing in the Collection Cable

33 Substation Construction

34 Tower Delivery

35 Nacelle Delivery

36 Blade Delivery

37 Setting the Mid Section

38 Setting the Rotor

39 Receiving the Rotor

40 Stephens Ranch Wind Energy Project Summary of Work (222) 1.7MW Wind Turbine Generators=377.4 MWS Access Roads = 59 Miles Concrete in Foundations = 75,000 CYS Rebar in Foundations = 5,126 Tons Anchor Bolts in Foundations = 32,620 Collection System Cable Trench = 102 Miles Transmission Line = 18 Miles WTG Components to be Erected = 1,165 Total WT. of All WTG Components = 61,885 Tons

41 Operation Length of time Dependant on lease Inexhaustible source versus oil and gas Costs Turbine availability Service life of turbines Staff Number 10 per 100 MW in US Training Roles Operation Maintenance Accounting Security

42 UK Experience Current Situation Current capacity 7,400 MW (total onshore & offshore Current offshore wind from 1,525 MW (December 31, 2011) September 17, ,000 MW online 10.6% of UK s power needs Today generally wind supplies 2.2%

43 UK Experience (cont.) UK Goal for % of all UK s Energy needs 18,000 MW offshore 13,000 MW onshore

44 UK Experience (cont.) National Grid 30,000 MW 2020 Scheduling Fossil Fuel Reserve Why Urgency?

45 Why Offshore? Available land N.I.M.B.Y. Project size

46 UK Development Details Land Lease (onshore/offshore) Landowner payment (2-10%) Length 30 years plus (extension) Permitting & Approvals (onshore/offshore) Who local government authority other Time period 5-8 years Net Capacity Factor Wholesale Energy Prices ± 43 pounds PPA Merchant

47 Tax Incentives Current State Renewable Obligation Certificates (ROCs) 1 ROC = 47 pounds Onshore Project ROC per MW ROC per MW Offshore Project ROCs per MW ROCs per MW ROCs per MW Future (2017) Feed in Tariff 20 years equivalent to current scheme

48 Economic Impact ,000 MW 42,000 full-time jobs 25,300 indirect jobs Current Retail Price for Energy 13.7 p/kw (including vat)

49 Questions? Steven K. DeWolf Work: (214) Cell: (214)