FERC Approves Rock Island Clean Line Transmission Project

A major milestone has been achieved in the development of the transmission line project to move wind energy from Iowa to Illinois and points east, an action that will allow the project's developer, Clean Line Energy Partners to begin negotiations with transmission line customers.

From a Press Release from Clean Line:

HOUSTON (May 23, 2012) – Rock Island Clean Line LLC (Clean Line) has obtained a key regulatory approval from the Federal Energy Regulatory Commission (FERC) to begin negotiating transmission service agreements with potential customers of the Rock Island Clean Line transmission project, likely load serving entities or wind developers.

The Rock Island Clean Line is a 500-mile overhead high voltage direct current (HVDC) transmission line that will run from northwest Iowa to an area near Morris, Illinois. The project will deliver 3,500 megawatts of the best wind energy resources in Iowa, Nebraska, South Dakota and Minnesota to communities in Illinois and other states to the east, areas that have a strong demand for clean, reliable energy.

The FERC order was issued in response to the application filed by Clean Line in November 2011. Receiving this authority permits Clean Line to subscribe up to 75% of the line’s capacity with anchor tenant customers and sell the remaining capacity through an open season process. The anchor tenants will receive guaranteed capacity outside of the open season process; however, the same terms and pricing will be offered in the open season.

“The Rock Island Clean Line project will create good-paying labor jobs for Illinois families, help reduce rates for Illinois electricity consumers by providing more choices and provide clean home-grown renewable energy to support our environment,” said Illinois Governor Pat Quinn. “The approval from FERC is a positive step forward for this project.”

In its application, Clean Line addressed the following standards: the justness and reasonableness of rates; the potential for undue discrimination; the potential for undue preference, including affiliate preference; and regional reliability and operational efficiency requirements. Clean Line also described why granting its request will be in the public interest.

Iowa Governor Terry Branstad said in response to the favorable FERC ruling, “The Rock Island Clean Line project has the potential to bring billions of dollars of new investment to Iowa and createthousands of jobs. I’m therefore pleased to see this approval by the Federal Energy Regulatory Commission.”

Clean Line has conducted over 600 one-on-one meetings with stakeholders, has hosted 33 open house meetings to which over 40,000 landowners were invited to submit feedback on routing options, and has held additional open houses in Illinois to introduce local businesses and labor groups to the Rock Island Clean Line project. Substantial progress on engineering and design of the project has been made since its inception in early 2010. In June of 2011, Clean Line signed an agreement with Siemens to provide HVDC technology solutions for the Rock Island Clean Line. Under that agreement, Siemens and Clean Line are working together to develop, design, and implement the HVDC converter stations for this important infrastructure project. In the summer of 2011, Clean Line acquired 2007-vintage interconnection queue positions that are advancing through the regional merchant transmission study process. These queue positions will greatly accelerate the interconnection process for the Rock Island Clean Line.

“This approval marks an important step forward in the steady progress of our Rock Island Clean Line project, which will bring considerable benefits to the existing grid by delivering low-cost clean wind power from northwest Iowa and the surrounding region to Illinois and states to the east," said Michael Skelly, President of Clean Line Energy. "We thank the FERC commissioners and staff for their diligence and consideration given to our application. We look forward to continuing to create opportunities for new jobs, low-cost clean energy and significant investment in Iowa and Illinois.”

Developing a project of this scale is a long-term undertaking; the approximately $1.7 billion project is expected to achieve commercial operation in 2016 or 2017. For more information about the Rock Island Clean Line, please visit www.rockislandcleanline.com.

Invenergy Closes Debt Financing on 200MW Vermillion Co Project

From an Invenergy Press Release:

CHICAGO, IL - (April 30, 2012) – Invenergy Wind LLC (“Invenergy”) announced today that it has closed debt financing for its 200 MW California Ridge Wind Energy (“California Ridge”) project, which currently is under construction in central Illinois.

The financing included construction, bridge and term loans and a letter of credit facility.  The 

financing was allocated across a bank tranche and an institutional tranche.  

Santander/Sovereign Bank acted as Lead Arranger and Global Coordinator.  Rabobank was 

Syndication Agent and Letter of Credit Issuer.  Union Bank, RBC Capital Markets, and Lloyds 

were Co-Documentation Agents.  Prudential Capital Group led the Institutional tranche of the  facility, and acted as Structuring and Documentation Advisor.  Allstate also participated in the Institutional Tranche.

“Invenergy is proud to complete financing for the  seventh wind project we are building in our home state,” said Jim Murphy, Chief Financial Officer and Chief Operating Officer of Chicagobased Invenergy.  “This financing utilized a blend of bank and institutional sources to provide both flexibility and tenor.”

California Ridge is located northwest of Danville, Illinois, in Champaign and Vermilion Counties.  Upon its scheduled completion later this year, the project will feature 134 General Electric 1.6 MW wind turbines and generate enough energy to power approximately 65,000 homes. Energy produced from California Ridge will be purchased by the Tennessee Valley Authority through a long-term power purchase agreement.

The wind turbines utilize GE’s latest technology, including 100 meter rotor diameters and 100 meter towers.  White Construction is responsible for the turbine erection and other balance of plant work.  Henkels & McCoy will be responsible for the construction of  the project’s transmission line and substation.  GE will provide certain construction management services for the substation work.  The project will be operated by Invenergy Services LLC.  

About Invenergy

Invenergy and its affiliated companies develop, own and operate large-scale renewable and other clean energy generation facilities in North America and Europe. Invenergy is committed to clean power alternatives and continued innovation in electricity generation. Invenergy's home office is located in Chicago with regional development offices located throughout the United States, Canada, and Europe.

As the nation's largest independent wind power generation company, Invenergy and its affiliated companies currently have over 6,600 MW of wind, solar and thermal projects under contract, in construction or in operation. For more information, please visit www.invenergyllc.com.

Contact: Alissa Krinsky

Director of Communications

312-582-1554 or akrinsky@invenergyllc.com

Renewable Energy Saved Illinois Consumers Over $100 Million

 New report from the Illinois Power Agency shows wind and other renewables reduced wholesale power prices, boosted economic growth

WIND ON THE WIRES PRESS RELEASE -- CHICAGO, IL (April 10, 2012) - Illinois residents and businesses saved over $100 million in power costs thanks to wind and other renewable energy sources, a result that highlights the broad importance of wind energy to the state's economy.

In a study prepared for the Illinois General Assembly late last month, the Illinois Power Agency (IPA) found that adding wind power to the electric grid reduced wholesale power prices by $176.8 million while simultaneously creating jobs and other economic opportunities for residents and businesses. The conclusion affirms that renewables are a positive addition to the state's energy portfolio.  

"When the sun is shining or the wind is blowing," the report states, "the combined output of renewable generators benefits all customers by bringing down the market price of electric energy for all resources operating at that time. This is because wind and solar generation can effectively bid in at a zero fuel cost."

According to the study, renewable resources lowered Illinois' average locational marginal price (LMP) for electricity by $1.30 per megawatt-hour (1.3 cents per kilowatt-hour), for a total savings of more than $176 million.

"This landmark study affirms what the wind industry has known for years," said Wind on the Wires Policy Manager Kevin Borgia. "Wind energy has no fuel cost, which allows wind generators to bid lower spot market electricity prices than any traditional energy source. This translates to lower power prices for Illinois ratepayers and businesses."

 

The IPA analysis confirms similar studies from Massachusetts and New York, which also found wholesale price-reductions from incorporating renewables onto the power grids in those states.

 

Illinois businesses are also enjoying strong growth from the manufacturing of wind turbine components and construction of wind farms in Illinois, the study notes, highlighting a 2011 Illinois State University (ISU) report on the economic impact of wind energy in the state.  

 

The ISU report found that the first 2,422 MW of wind installed in Illinois has created over 13,000 temporary jobs and nearly 600 permanent jobs in the state, while also providing new business to construction, engineering and manufacturing-related firms. These new opportunities were in addition to the millions of dollars paid to Illinois landowners leasing space to wind farms, and millions in new property taxes that wind developers pay to local governments in Illinois.

 

Despite the positive findings, the IPA report also highlights the need for additional action to ensure Illinois ratepayers fully benefit from wind energy. The IPA analysis notes that renewables can be a hedge against electricity price volatility, but those benefits are not captured by a reliance on one-year contracts for renewable energy certificates (RECs), which has been the IPA's primary mechanism for procuring renewables since 2007.

 

A REC is a derivative product of renewable energy, it is not physical energy. A reliance on one-year RECs subjects Illinois ratepayers to volatility in both REC prices and fossil fuel prices because of the laws of supply and demand.  

 

The price of energy from wind is near an all-time low. Consumers would benefit from locking in long-term power-purchase agreements (PPAs) for wind energy now. Such long-term PPAs are standard in the renewable energy industry. Longer term contracts will lock in these low prices for a 10 to 20 year period. They also provide a stable revenue stream necessary for new generation to be built, bringing additional jobs and economic development to the state.

 

The full study can be found at the IPA website: http://www2.illinois.gov/ipa.

Caterpilar Signs Deal to Remanufacture Vestas Turbines

One of Illinois' largest industrial players is entering the wind power sector, with equipment manufacturer Caterpilar signing a deal this week with to remanufacture wind turbines made by Vestas, the world's largest turbine maker. According to a press release from the companies (via Marketwatch.com):

Caterpillar Inc. and Vestas Wind Systems have reached a 10-year, global agreement to remanufacture wind turbine components. Vestas, of Aarhus, Denmark, is the world's leading wind turbine manufacturer, with an installed base of 44,500 turbines.

Vestas has chosen to enter this agreement to ensure remanufacturing services of high quality and at a competitive price for its customers. With the agreement, Caterpillar will supply Vestas with cost-competitive remanufacturing services that will enable its components to meet the highest quality and reliability standards, while at the same time reducing the impact on the environment. The relationship with Caterpillar will be managed by Vestas' Spare Parts & Repair Business Unit and will cover the remanufacture of minor components and sub-component repair in support of Vestas' internal repair sites.

"Caterpillar is a global leader in remanufacturing, and we're excited to be providing those services to Vestas," said Greg Folley, Caterpillar vice president with responsibility for the Remanufacturing & Components Division. "Our tradition of quality and continuous improvement will serve Vestas customers well. This agreement is also an example of Caterpillar's focus on sustainable development: by applying our technology and innovation to other products, we use our resources more efficiently, have less impact on the environment and support our customers at the same time."

Cat Reman will use its global presence and expertise to remanufacture Vestas wind turbine components using its existing facilities, equipment and suppliers. Remanufacturing will begin in Caterpillar's North America facilities followed by facilities in Europe and Asia.

"The agreement with Caterpillar shows Vestas' commitment to creating high-quality and cost-competitive solutions while at the same time doing it in the most sustainable way possible. We believe that is what makes our customers satisfied and what creates a business model where the driver is the long-term development," says Phil Jones, President of Vestas' Spare Parts & Repair division.

Vestas Spare Parts & Repair is at the core of Vestas' Service business. The global wind turbine manufacturer forecasts the total Service operations to become a EURm 700 business by the end of 2011.

Remanufacturing operations return end-of-life components to their original "same-as-when-new" condition in terms of reliability, durability and performance. It reduces waste, minimizes the need for raw materials to produce new parts and supports both Caterpillar and Vestas in providing customers with the lowest life cycle cost over the life of a product.

News reports do not indicate where the remanufacturing activity will be located.

Visit the Illinois Booth at WINDPOWER 2011! Booth 1551

For the third year in a row, the Illinois Wind Energy Association will join the largest players in the global wind energy industry as an exhibitor at next week's WINDPOWER 2011 conference in Anaheim, California. IWEA members and others interested in discussing wind power issues in Illinois are encouraged to stop by the booth any time during the week.

IWEA is co-sponsoring the Illinois booth (#1551) with several key groups in the wind power space in Illinois, including:

• Illinois Department of Commerce & Economic Opportunity
• The Center for Renewable Energy at Illinois State University
• The Illinois Development Council

Sponsored by the American Wind Energy Association, WINDPOWER 2011 is the world's largest event for the wind energy industry, and is expected to draw over 25,000 people to Anaheim.

For more information: www.windpowerexpo.org

PROPOSED WIND ENERGY DEVELOPMENT WILL BRING BILLIONS IN ECONOMIC INVESTMENT TO ILLINOIS

New Report Entitled “Investing in Illinois” Shines Light on Significant Economic Benefits of “Shovel-Ready” Wind Farms

SPRINGFIELD, ILLINOIS –As many as 20,000 jobs would be created with the development of the 3,200 MW of utility-scale wind generation currently permitted in Illinois, according to a report from three leading wind energy organizations.

The report—entitled “Investing in Illinois” and released by the Illinois Wind Energy Association (IWEA), American Wind Energy Association (AWEA), and Wind on the Wires (WOW) — is being released at a crucial time, as state lawmakers consider legislation to overhaul the state’s electric market. The study highlights why any major energy bill passed this year must include provisions that accelerate development in Illinois of clean, affordable, homegrown renewable energy.

Download the full report here!

Using the U.S. Department of Energy’s Job and Economic Development Impacts (JEDI)/ model, the report finds that if all 3,200 MW of the current permitted wind projects were developed in Illinois, the state would likely:

• create over 19,000 new jobs in construction, manufacturing and maintenance in the near term;
• generate more than $930 million in construction wages and $34 million in annual operations and maintenance wages;
• produce over $32 million in annual new local tax revenue, approximately 70 percent of which would go directly to local school districts;
• generate over $9 million in annual lease payments to Illinois farmers and landowners; and

Illinois currently has installed over 2000 MW of wind energy, but it has the potential to do much more. According to the National Renewable Energy Laboratory, Illinois’ wind resource could meet over five times the state’s total current electricity needs.   However, the current market for commercial wind remains largely untapped because the state’s existing Renewable Portfolio Standard (RPS) law makes financing new wind projects difficult. Legislation now before the Illinois legislature would expand and streamline the RPS program, facilitate the type of long-term power contracts with utilities that renewable energy developers need in order to get projects built, encourage project construction in Illinois, and ensure economic development benefits for the state.

“With the right policies in Illinois, we can ensure that a significant number of the 3,200 MW of permitted wind projects will go to construction within the next few years.  Wind energy can create thousands of new jobs, but to tap wind’s tremendous economic potential, Illinois needs policies that reflect current market realities and foster financing of new projects,” said IWEA Executive Director Kevin Borgia.

Added Borgia, “At a time when Illinois schools are facing late state payments and the specter of district consolidation, lawmakers need to look at every possible option for new revenue. For many parts of rural Illinois, the greatest potential for new revenue lies in new commercial-scale wind development. This analysis quantifies just how important wind is for rural schools and counties.”

“This report informs Illinois of the scale of potential economic growth it would receive from further wind development,” said Sean Brady, Regional Policy Manager for Wind on the Wires. “We are excited to see Illinois legislators interested in improving the RPS.  The amendments being proposed would diversify Illinois’ energy portfolio through the use of long-term contracts for renewable sources, which translates into rate stability for Illinois electric consumers.”

“Illinois is currently a national leader in the evolving and growing wind industry,” said Brad Lystra, Manager of State Campaigns at the American Wind Energy Association. “The state is home to 25 manufacturing facilities, and the industry employs over 5,000 workers. However, unless the legislature makes the necessary improvements the current policy, the future success of the wind industry in Illinois will be severely hindered because of the narrow scope of the state’s RPS.”

The full text of the report is available at: www.WindforIllinois.org. More information on the Job and Economic Development Impact (JEDI) model can be found at: www.windpoweringamerica.gov.

IWEA Invites Wind Developers in Wisconsin: "Escape to Illinois"

Extreme setbacks in legislative proposal would make Wisconsin much less attractive for wind energy development than Illinois

IWEA PRESS RELEASE (CHICAGO) -- Today the Illinois Wind Energy Association (IWEA) invited wind power developers working in Wisconsin to focus their efforts on Illinois, where Governor Pat Quinn and the Illinois General Assembly have worked to streamline regulations for the wind energy business.

Wind developers have been apprehensive about investing in Wisconsin since Governor Scott Walker proposed legislation that would effectively ban wind development from the Badger State. With these new job-destroying regulations on the table, IWEA is happy to highlight the much more business-friendly climate just to the south.

Recently introduced in the Wisconsin legislature, the War on Wind Initiative would dramatically extend setback distances from wind turbines in the state. If adopted, the bill would mandate a minimum setback requirement of 1,800 feet from neighboring property lines, far exceeding the setback distance from occupied dwellings specified in a rule issued by the Public Service Commission of Wisconsin.

“Even the strictest county setbacks in Illinois are nowhere near as extreme as what Wisconsin would have if this bill passes,” said IWEA Executive Director Kevin Borgia. “Illinois has no statewide minimum setbacks.”

As Denise Bode, CEO of the American Wind Energy Association, said to the Milwaukee Journal-Sentinel last week, “it is one of the most onerous regulations we have ever seen.”

“In light of Wisconsin’s War on Wind, IWEA invites developers to focus their resources on Illinois,” Borgia said. “Businesses with wind farm proposals in both states are likely to focus their efforts on locations with the most beneficial regulatory climate. If the legislation is adopted, that location will not be Wisconsin.”

“Today we introduce a call for wind developers to ‘Escape to Illinois.’  You are welcome here.  Our talented workforce stands ready to help you grow and prosper,” Borgia said.

“Illinois is open for business.  In these challenging economic times, while Wisconsin is raising barriers, we are lowering them.  The Illinois General Assembly has seen strong, bi-partisan support for wind energy in the past decade, and Gov. Quinn has also led the charge to bring more wind farms to Illinois,” Borgia said.

Developers in Illinois placed 498 MW of wind generating capacity in service in 2010, and almost 400 MW more should come on line in the next three to six months, In contrast, Wisconsin added only 20 MW of wind generation last year.  

“Illinois’ favorable regulatory climate for wind power will create over three-billion dollars in economic activity in the coming decades,” Borgia said.

According to a recent study by Illinois State University, the first 1,848 megawatts of wind capacity in Illinois:

• Support local economies by generating $18 million in annual property taxes
• Generate $8.3 million annually in extra income for Illinois landowners who lease their land to wind farm developers
  
• Created approximately 9,968 full-time equivalent jobs during construction periods with a total payroll of over $509 million
• Support approximately 494 permanent jobs in rural Illinois areas with a total annual payroll of over $25 million

The proposed wind ban is also helpful to Illinois wind farms because electric utilities in Wisconsin are more likely to meet their renewable energy needs using Illinois resources if wind energy is prohibited in the state.

IWEA urges Wisconsin utilities to reach out to Illinois wind projects to achieve their renewable energy goals, Borgia said.