Building Wind Communities Why Smaller Might be Better

Economies of scale help reduce costs when building just about anything—and wind farms are no exception. A 200-megawatt (MW) facility, for example, costs a lot less per MW than a four-MW installation. But bigger is not always better, say a number of midsize and small-wind advocates who see an important role for community-scale projects.

Community-wind advocates promote midsize projects, many as small as two to five MWs. They point out that community-scale wind has many advantages over capital-intensive, corporate-owned wind farms. For example, several geographically diverse but interconnected midsize installations can often make better use of wind resources than a single large utility-scale wind farm. A coalition called 25 x “25 has brought together farmers and conservationists who are dedicated to seeing 25% of our power come from renewable resources by 2025. As cited in 25 x “25’s “Community Wind 101” report, a Minnesota legislature-commissioned study found that wider distribution of wind production could reduce the time when little or no power is being produced. It would also help operators manage sharp increases in power when wind suddenly picks up, resulting in a more stable electricity supply.

Small wind is better suited for utilizing existing transmission lines, says Mike Bowman of 25 x “25. Utility-scale projects require more advanced transmission; smaller projects don”t. “We have a distribution system in this country where 80% of the geography is served by rural electrics,” Bowman says. This system was built by President Franklin D. Roosevelt in the mid-“30s to bring electricity to rural areas because the private sector wouldn’t make the investment. “What we have today, 70 years later,” he says, “is a system that’s in place for delivering small amounts of power to thousands of places simultaneously.” It’s a system that supports the build-out of a network of small wind farms because it can help us move power out to the load centers, or urban areas, he says.

Betting on Wind

Small-scale wind installations may well deliver more dollars to local economies, and more jobs, too. One National Renewable Energy Laboratory study compares a 40 MW plant owned by outside investors to 20 two-MW plants owned locally. Local income and job creation was more than double that of the large-scale approach to wind generation.

Locally initiated projects are likely to have fewer problems with getting permits, too, because the community reaps the benefits. One small installation in Wray, Colorado, for example, produces 100% of electricity needs for the school and about 20% for the town. The benefits are very apparent to the residents.

Small installations also serve to establish a foothold for wind in a promising location. They allow residents to become familiar with the technology, help to gauge the site’s generating potential, and serve as a “launch pad” for expansion. Finally, national security is enhanced by many small-scale wind farms. A decentralized energy-generating infrastructure is less vulnerable to terrorism. This is certainly true when it comes to comparisons with nuclear power. However, the argument holds for virtually any large-capital power plant that could be destroyed with a single terrorist strike. Community-wind advocates are not saying that smaller-scale wind is the best solution in every situation. They just want a level playing field so that projects initiated by groups of farmers, coops, schools and towns are not disadvantaged by the national energy policy.

When asked what needs to change, Bowman says he would like to see production tax credits for wind energy extended to small-scale producers. To date they can only be used to offset passive federal tax liabilities. Therefore, in effect, they only benefit large corporations that have passive tax income. (Passive tax income may come from corporate profits. Active tax income is earned directly from work, such as by a farmer selling his crop.) Bowman wants the tax credits to be available to nonprofits and rural electric organizations without tax liabilities. “We should not have tax structure that biases anyone who wants to put power into the system,” he says. Another possibility would be to allow the trading of production tax credits. Doing so would enable nonprofit energy producers to sell their credits directly to the big players.

Regulatory issues pose problems for community-scale wind, too. Bowman says there is an estimated 50,000 MW of potential across the central Great Plains that can support farmer-owned and community-scale projects. This abundant resource could support thousands of small (five to 40 MW, with most being closer to five) projects dotted across the landscape that take real advantage of existing infrastructure. Unfortunately, it is hard for farmers and others, due to regulatory issues, to access the very network that they, as taxpayers, have funded.