Texas ratepayers' price tag for new wind-power
lines in billions
Texas ratepayers could be on the hook for $3 billion
to $6.4 billion to build new transmission lines so
wind-power turbines can connect to the state power
grid, according to preliminary estimates released
The eye-popping cost projections by operators of
the Texas power grid could equate to as much as $320
for every man, woman and child getting power from
the grid, although the impact on individual bills
The money would be used to build lines that theoretically
would encourage more wind-power development in the
Panhandle and West Texas.
Wind-power advocates say the potential expense could
be a bargain, saying that besides leading to cleaner
air, the expensive new transmission lines will pay
for themselves because of the zero fuel costs associated
with wind power.
"There is no question that adding more wind energy
to the grid will reduce the overall cost of energy
to ratepayers, particularly as fossil-fuel prices
increase," said Ned Ross, director of regulatory affairs
for FPL Energy, the state's largest wind-energy provider.
But skeptics say consumers should watch their pocketbooks.
They say that the giant price tag will get coupled
with additional hidden costs and that much of the
benefit from lower fuel costs will go to energy companies
and not ratepayers.
"Anytime you're spending several billion dollars,
that should be cause for concern for consumers," said
Thomas Brocato, an attorney representing Fort Worth
and other North Texas municipalities in utility matters.
Landowners could also lose thousands of miles of
property through eminent-domain proceedings.
The projected expenditures are largely associated
with the legal and regulatory cost of acquiring such
right of way, along with the price of the big latticework
transmission towers and wires needed to move power
from the far reaches of the state.
The new cost estimates were released Wednesday as
part of an extensive study on wind power by the Electric
Reliability Council of Texas, the quasi-governmental
organization that operates the state's power grid.
ERCOT conducted the study as part of its implementation
of Senate Bill 20, a 2005 law calling for special
zones where the construction of transmission lines
would potentially encourage wind-power development.
The ERCOT study describes five different scenarios
and outlines the cost of construction within each
It also examines the potential location of new lines
and spells out other engineering and technical details.
The study now goes to the Public Utility Commission,
which will select a scenario within months and then
sign off on a transmission construction plan within
about a year, a spokesman said.
The price tags for the five scenarios are $2.95 billion,
$3.78 billion, $4.83 billion, $5.46 billion and $6.38
The costs would be divided up among all ratepayers
in ERCOT through a fee attached to bills and paid
off over several years.
The least-expensive scenario could lead to 5,150
megawatts of additional wind power and would require
about 1,600 miles of new transmission lines.
A single megawatt provides enough power for 500 to
700 households under typical operating conditions.
The most-expensive plan could be sufficient for 17,956
additional megawatts and require more than 3,000 miles
of new transmission lines.
Public Utility Commission spokesman Terry Hadley
said the agency's three commissioners will try to
ensure that ratepayers get a good deal. He said the
transmission construction could be complete within
about five years.
"The commission will most likely begin reviewing
this at their open meeting next week, and the cost
is a large concern," Hadley said.
Wind-power advocates say the new transmission lines
could pay for themselves because the cheaper wind
power will replace more expensive power generated
by fossil fuels. Ross of FPL Energy also said that
the new transmission lines will serve other electric
generators besides wind and that the state needs to
invest in new lines to serve its growing population.
But critics have raised war- ning flags, noting that
no state agency has undertaken an overall review of
the relative merits and costs of pursuing alternative
Jeff Pollock, an expert testifying on behalf of
a group of Texas industrial customers, told the PUC
earlier that "what is known is higher transmission
and [other] charges associated with new wind generation
will increase the electricity costs paid by all consumers."
With almost 5,000 megawatts of existing generation,
Texas leads the nation in wind power. ERCOT said wind
generation would leap to 12,000 to 24,000 megawatts,
depending upon which scenario the PUC selects.
However, because of the intermittent nature of wind,
ERCOT depends on only about 8.7 percent of capacity
when determining available power during summer peak
Texas in 2007 extended its lead as the nation's No.
1 wind-energy state and hosts four of the nation's
five biggest wind farms, says a new report by the
American Wind Energy Association. Still, the proportion
of electricity produced by wind in Texas is below
a number of other states. Here's a look at how the
states stack up.
In megawatts and as a percent of state's total electricity
generated (a megawatt is 1 million watts):
Texas 4,446 (2.0 percent)
California 2,439 (2.6 percent)
Minnesota 1,299 (4.6 percent)
Iowa 1,271 (5.5 percent)
Washington 1,163 (2.0 percent)
Capacity added in 2007
Largest wind projects in operation
Horse Hollow, Texas 736
Sweetwater, Texas 585
Peetz Table, Colorado 401
Capricorn Ridge, Texas 364
Buffalo Gap, Texas 353
Source: American Wind Energy Association