Westar Not in Wind Market Kansas Utility Says Now Isn't the Right Time
Dec 27 - Topeka Capital Journal
Find expanded coverage of wind energy development in the Flint Hills.
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Find expanded coverage of wind energy development in the Flint Hills.
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KANSAS ENERGY
The Kansas Energy Council released its 2005 report. Here are some highlights:
- Kansas set a record for the value of the oil and natural gas produced in the state --- $3.3 billion. KEC chairman Lee Allison said the value was boosted by the rising cost of oil and natural gas during the past year.
- Ethanol production increased 60 percent to a new record of 130 million gallons in Kansas in 2004. Production is expected to increase to 200 million gallons next year as two new plants begin operation.
- Kansas continues to be a net importer of energy, a trend that is expected to continue through 2009, though at a slower rate.
- The full KEC report can be found at www.kansasenergy.org.
ANTHONY S. BUSH/THE CAPITAL-JOURNAL
Wind turbines spin near Montezuma on the Gray County Wind Energy Center. Westar Energy has taken itself out of the wind energy market, for now.
WIND ENERGY
By Chris Moon
THE CAPITAL-JOURNAL
In a blow to Kansas' fledgling wind energy industry, Westar Energy is no longer in the market to buy wind power.
A dozen wind energy companies had been jockeying to do business with the state's largest electricity supplier when it said in a statement Monday that wind energy was "simply not in the best economic interest of our cus-tomers and shareholders."
"We are able to generate energy at a considerably lower cost than we would pay for the energy produced through any of the received proposals," said Dave Sterbenz, Westar's senior vice president for generation and marketing.
The decision was applauded by conservationists opposed to wind energy developments in the Flint Hills, where several developments have been proposed during the past several years. They say Westar's decision touched upon a larger impracticality of wind energy.
"That's the most appropriate decision for them to make," said Ron Klataske, executive director of Audubon of Kansas. "It's more cost- efficient for their consumers."
Westar said 12 companies submitted 16 proposals to generate wind energy for Westar. A separate proposal was made by a company seeking to provide landfill gas --- another renewable energy source --- to Westar.
Westar in February had requested proposals for 50 to 200 megawatts of renewable energy. The company now says it will continue looking toward partial or full ownership of a wind energy development.
But that appears well in the future.
"We want to keep the door open to renewable energy, but our current course will not allow us to take advantage of the production tax credits that are set to expire at the end of 2005," Sterbenz said.
The federal government this year extended a federal tax credit for wind energy producers, setting in motion several projects across the state. However, wind energy developments must be up and running by the end of next year to take advantage of the tax break.
"There's a gold rush-type of mentality out there right now," said Lee Allison, energy adviser to Gov. Kathleen Sebelius. "But Kansas is in this for the long run. At some point, wind is going to make better economic sense."
Allison described Westar's exit from the wind energy market "a short-term blow" for developers.
There are 15 known proposals for wind energy developments in Kansas. But Allison said the state's electric transmission system can support only a handful.
Already, Kansas has a large wind farm near Montezuma in western Kansas. Another project is under way in Butler County and will send power to a Joplin, Mo.-based energy system.
Allison said Westar relies heavily on coal and nuclear plants, which can't easily be shut down while the company collects electricity from a wind development. Then, when the winds calm, those coal and nuclear plants can't easily be restarted.
Energy companies that rely on natural gas can more easily adapt their operations to the whims of the wind, Allison said.
Meanwhile, wind energy developers continue to piece together their proposals.
Jennifer States, spokeswoman for Lawrence-based J.W. Prairie Windpower, said the loss of the Westar as a potential customer is just one of the reasons her company's project in Morris County remains on hold. The foremost is the governor urging wind energy developments in the "heart" of the Flint Hills to proceed slowly.
Wind energy has been a hot-button issue among landowners in the area, where some want preservation and others want wind energy as an income source. Sebelius has urged utility companies working on developments in the core of the Flint Hills to remain on hold while she forms her own policy on wind energy on the prairie.
Sebelius is studying proposals by the Kansas Energy Council --- which were released on Tuesday --- that urge the Legislature to adopt a state tax credit for wind energy producers. Nicole Corcoran, a spokeswoman for Sebelius, said the governor should have a policy recommendation outlined shortly after Christmas.
Chris Moon can be reached
at (785) 233-7470 or chris.moon@cjonline.com .
Please see WESTAR, Page 11A
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Westar: 'A short-term blow'