An update on the wind energy market (Buyers of wind power lacking):
The developer of the largest wind farm ever proposed in North Carolina says the project has stalled because no utility wants to buy the power the project would produce.
Iberdrola Renewables, having put more than three years into a 31-square-mile wind farm near the coast, this week began notifying property owners and public officials in Pasquotank and Perquimans counties that the project is on hold indefinitely. If built, the Desert Wind Energy Project near Elizabeth City would have ranked among the largest wind farms in the country.
Iberdrola has developed more than 40 wind farms in this country, but the Spanish company has been unable to find a buyer for the power output of Desert Wind. The $600 million undertaking was to include 150 turbines, enough to supply power to as many as 70,000 homes....
The Desert Wind project began in early 2009, with millions of dollars invested since then in wind studies, environmental impact statements and engineering analyses of roads, soils and transmission systems. The N.C. Utilities Commission approved the project in May in a proceeding remarkable for the absence of public protests. Iberdrola has signed real-estate agreements with some 40 property owners who would be paid annual fees of $6,000 or more in exchange for hosting turbines standing 500 feet tall at the upper tip of the blade.
But months of talks with neighboring power companies have failed to yield a contract. Iberdrola will not be able to finance the project until it can show institutional lenders a long-term contract with guaranteed cash flow.
Progress Energy in Raleigh, one of Desert Wind's potential customers, ended talks with Iberdrola after the parties couldn't come to an agreement. "Generally, their price was higher than other prospective wind projects," Progress spokesman Mike Hughes said.
Power companies such as Progress are shutting down old coal-burning power plants and building power plants fueled with natural gas, considered the cleanest fossil fuel.
Copleman said slack energy demand in the wake of the recession, coupled with historically low natural gas prices, are creating a competitive disadvantage for wind farms nationwide. Electric utilities in North Carolina and elsewhere pay a premium for wind power under state energy policies that require a certain commitment to clean energy. ...
Iberdrola had hoped to begin construction this year to qualify for a 30 percent federal incentive payable in a lump sum. The company could still qualify for another form of the incentive paid out over a 10 years if the project is completed by the end of 2012. Both incentives are scheduled to expire, and it's not clear if Congress will extend them.
One's only conclusion can be that one needs more government subsidies (sarc).