LINCOLN — Proponents of Nebraska wind energy on Wednesday heralded unprecedented growth that will more than double the state's wind generation capacity in the next two years.
But they also learned at an annual conference here that the project slated to be the first to export wind power out of state won't begin construction this year as had been hoped.
Such are the promises and challenges of wind energy.
In his opening speech at the Nebraska Wind Conference, Gov. Dave Heineman said that more work needs to be done to develop the state's wind power
Wind farms add to local property tax revenue while encouraging economic development that benefits both rural and urban areas, Heineman said.
“More and more businesses are making their decision about where they locate their company based upon green energy factors and lower energy rates,” he said. “I want to make sure that we are competitive on both fronts.”
Despite having the fourth-best wind potential of any state, Nebraska's 459 megawatts of installed wind power capacity ranks last among its neighbors. Among all states, Nebraska ranks 23rd when it comes to wind power generation.
Other states, especially Iowa, have been more aggressive about pursuing wind projects by offering tax breaks and other incentives. Nebraska lawmakers have passed legislation in recent years that has made the state more competitive, several conference speakers said.
Those incentives, along with more competitive prices for wind-based electricity, have spurred growth in Nebraska.
Based on wind farm projects under construction and recently announced, the state is on pace to add another 750 megawatts of wind power by the end of 2015, said John Hansen, president of the Nebraska Farmers Union and a conference organizer.
“These wind projects are game changers for rural communities because they provide jobs and tax revenues,” Hansen said.
Exporting wind energy out of a relatively low-population state such as Nebraska is crucial for the continued growth of the industry. Last year, the Legislature passed a bill that expanded tax breaks for large wind farms designed to export power.
TradeWind Energy of Lenexa, Kan., was planning such an export project in northeast Nebraska. The company announced Wednesday that it would not be able to break ground this year.
Higher transmission costs, limits on transmission capacity and other factors led to the decision, said Frank Costanza, an executive vice president of the company.
The company was working to start the project, named Rattlesnake Creek, by the end of the year so it could qualify for the federal production tax credit for wind farms. The federal credit is expected to expire Dec. 31.
Costanza said that the company has already spent millions of dollars on the project, so it has no intention of walking way from Rattlesnake Creek. But he couldn't announce a new timetable for the project.
During his speech, Heineman mentioned that Nebraska's public power districts “need to respond in a positive manner” when it comes to helping the state develop its wind energy potential.
The Omaha Public Power District recently announced it would buy power from a 400-megawatt wind project called Grande Prairie northeast of O'Neill. And earlier this year, the Lincoln Electric System reached an agreement to buy wind from a 100-megawatt farm in Oklahoma because it offered a lower price than Nebraska projects.
In October, the Nebraska Public Power District voted against buying more wind power this year, saying it didn't need extra generating capacity. The decision was criticized by wind proponents.
On Wednesday, NPPD announced a wind energy agreement with BD (Becton Dickinson and Co.), a global medical technology firm with factories in Columbus and Holdrege. The company will purchase 30 megawatts of renewable energy credits through the recently completed Steele Flats project, a 44-turbine wind farm near Steele City. BD has set a corporate goal of using renewable sources for at least 25 percent of its energy consumption.