Monday September 24, 2012

FLORIDA -- All 19 wind turbines are up, and the testing and commissioning process is about to begin on Bakke Mountain in Florida and Crum Hill in Monroe -- the final step before the Hoosac Wind project can start generating power.

The 28.5-megawatt project has been in various stages of planning and litigation for more than a decade. Now, operators are rushing to get the operation online because the federal energy Production Tax Credit -- essential to financing wind turbine projects -- expires at the end of the year. When that happens, any wind turbine project not in operation will face an uncertain future unless Congress extends the production tax credit.

"You only get the tax relief when you are actually producing power by the end of the year," noted Ellen Carey, a spokesperson for the American Wind Energy Association. "They are facing a very hard deadline."

The production tax credit provides 2.2 cents in tax relief per kilowatt hour generated. With out the extension in place, about 37,000 jobs in the wind turbine assembly and construction in dustry will be lost by the end of the first quarter of 2013: Some U.S. turbine parts manufacturers have already started shuttering plants and laying off workers in Pennsylvania, Kansas, Iowa, Florida, Ne braska, Colorado, Texas and Oklahoma.

But officials at Iberdrola Renewables, owner of the Hoosac Wind project, are confident the commissioning process will be concluded and the turbines in operation by the end of autumn.

The local economic benefits have already taken hold: According to figures provided by Iberdrola officials, Hoosac Wind created three to five permanent jobs, nearly 140 temporary construction jobs, and $3.5 million in local spending generated by 44,000 local labor hours.

"It’s always great when a company comes in from the outside," said Bigs Waterman, owner of Waterman Exca vating, an Adams company that subcontracted with Hoo sac Wind to handle some of the drainage work at the construction site. "We probably did between $300,000 and $400,000 worth of work. We had eight guys up there along with trucks and equipment. That’s a lot of work for us -- it allowed us to keep our guys busy right through the winter."

In the coming years, payments in lieu of taxes, or Pilot, contracts approved by the developer and both communities will result in annual payments of roughly $135,000 to Florida and $122,000 to Monroe. The payments escalate over time and are expected to total about $6.8 million over 20 years.

Lease payments to the towns for turbines located on town-owned land will result in another $3 million through the length of the 35-year lease contract.

Hoosac Wind, with a total construction cost now estimated at $90 million, includes nine 1.5 megawatt GE turbines on Crum Hill in Monroe and 10 turbines on Bakke Mountain in Florida. The project is estimated to have enough capacity to power more than 6,000 average Massachusetts homes.

Economic benefits aside, Hoosac Wind is expected to offset about 100 million pounds of carbon dioxide every year of operation through replacement of energy provided by burning fossil fuels, or the equivalent of emissions from 9,400 cars burning more than 112,000 barrels of oil, according to data provided by Iberdrola.

Hoosac Wind will add to the 64 megawatts of wind energy capacity already operating in Massachusetts, 16.5 megawatts added this year alone. There are another 570 megawatts of wind power under development in the state.

The project had been delayed by litigation from 2004 to 2010. During the six-year legal battle, the cost of the project soared past the former estimate of $45 million. The Massachusetts Supreme Ju dicial Court cleared the way for work to begin in July 2010.

NStar, the state’s second- largest utility, has entered into a power purchase agreement for electricity produced at the Hoosac Wind project. While the actual electricity generated by Hoosac Wind will flow to users closest to the point of generation, NStar will sell the equivalent amount of power to its 1.1 million customers in Central and Eastern Massachusetts, according to NStar spokesman Mike Durant.

Figures provided by the American Wind Energy Association show that in 2011, wind turbines generated 2.9 percent of all electricity generated in the United States -- up to 20 percent of electricity in both Iowa and South Dakota. If permitted to continue development, wind could generate 20 percent of the nation’s electricity by 2030, providing about 500,000 jobs. In the last five years, wind energy made up 35 percent of all new U.S. power generation capacity.

Iberdrola Renewable wind farms are generating 5,200 megawatts of power in the United States annually on 50 sites using about 3,000 wind turbines.

To reach Scott Stafford:
sstafford@berkshireeagle.com,
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On Twitter: @BE_SStafford