EnergyBiz - January/February 2008 - (Page 13) energy needs, Boswell suggested. Furthermore, Boswell envisions a “blended price for the cost of nuclear, coal, gas and wind to meet air quality standards.” New wind power facilities are good for Texas, explained Bill Bojorquez, a vice president of system planning at the Electric Reliability Council of Texas, based in Austin. “We don’t have a lot of hydro-generation, but we’re blessed with wind. Renewables are good for Texas,” he said. Pickens’ project provides consumers with additional choice beyond coal and natural gas. Yet Bojorquez also noted that wind power has its limitations. Wind doesn’t blow much in the summer in Texas, and summers can last from May through September. Wind provides “good energy sources but not good capacity,” said Bojorquez. Because of wind power’s subsiding in the summer, Mesa Power is building a baseload of 500 to 600 megawatts of solid-fuel capacity and a separate 300 megawatts of peaking capacity. Mike Sloan, a consultant at Vertus Energy Research Associates, based in Austin, Texas, said Pickens is developing wind power facilities because “fossil fuel costs are significantly higher and likely will continue to rise.” Moreover, carbon taxes are likely around the corner, and wind power “is a domestic resource with no fuel costs and no emissions issues,” he said. Sloan said that the cost of wind power is actually quite predictable. The front-end costs are known, and wind blowing in Texas is steady; thus, Sloan said when the project is completed, Pickens can “lock in longterm purchase power agreements.” Moreover, if the energy environment were to change, he could easily scale back the project from a $10 billion venture into a smaller facility. Many utilities have eschewed investing the major bucks to build wind power on a speculative basis. Sloan said that most utility executives operate “in a more conservative culture that grew out of governmental regulatory rates. Pickens is a risk taker and an entrepreneur, and if he guesses right, he will be rewarded.” Asked how Pickens will make money on the project when investing so many billions of dollars, Bojorquez replied that German utilities and entrepreneurs have harnessed wind and made money. He recently met a German entrepreneur at a conference who told him, “I put 100 turbines in the field. For five years the turbines spin for the bank, but after five years the turbines spin for me.” Many wind power developers build a project and then flip it for a quick profit to recoup their start-up costs. But Boswell said, “I don’t expect that we will sell it. We already own most of the land.” What does Pickens’ proposed project say about wind energy’s future? “It tells us that this is where energy’s future is going, and smart players recognize that dollars are following that direction,” said American Wind Energy Association’s Randall Swisher. When it comes to making sound strategic moves, there’s no substitute for experience. Enspiria. Inspired solutions for more than 2500 successful client engagements around the world. Technical and business process consulting and systems integration expertise from the industry’s foremost authorities on Smart Grid and Advanced Metering Infrastructure, GIS, meter data management, outage management, field force automation, work and asset management, facilities inspection and maintenance, and T&D automation. © 2007 Enspiria Solutions, Inc., an Osmose company. Real People with Inspired Solutions to Real Problems www.enspiria.com • 303.741.8400 www.energycentral.com E n E rgyB i z 13 http://www.enspiria.com http://www.enspiria.com http://www.energycentral.com
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