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Economic and dam related articles

Irrigation District to Give Wind a Chance

by John Holland
The Modesto Bee, December 17, 2008

TID vote advances $450M bond issue

TURLOCK -- A vote Tuesday brought the Turlock Irrigation District a step closer to being a major user of wind power. The district board voted 5-0 to authorize a bond issue of up to $450 million to acquire a 136.6-megawatt system under construction in Washington state.

The bonds will be sold to investors only if the district determines by March 31 that the interest rate and other details are acceptable, said Joe Malaski, assistant general manager for financial serv-ices.

The project, which could be completed by March, would enable the TID to meet a state mandate to get at least 20 percent of its power from renewable sources by 2017.

The wind power would cost 7 cents to 8 cents per kilowatt-hour, General Manager Larry Weis said. That's more than the TID spends on electricity from its most efficient gas- fueled plant, but less than solar and most other sources of renewable energy would cost.

"It's a hedge to protect our consumers from the rising cost of renewable power," Weis said.

The TID has about 98,000 electricity customers in an area from south Modesto to northern Merced County, and from the La Grange area to the hills west of Patterson.

The project consists of 62 turbines in a windy area just north of the Columbia River. The TID would receive the power via existing transmission lines, or exchange it for electricity produced closer to home. The district originally planned to buy only the output from the plant from Cascade Wind Holdings, based in San Diego County. Owning the system outright would reduce the cost per kilowatt-hour, Weis said.

The construction cost is es- timated at $385 million, but $65 million more was authorized in the bond issue to cover financing and other costs. Advocates for wind power say it can meet a good part of the nation's demand without the pollution or climate-changing effects of fossil fuels.

Only about 1 percent of the U.S. electricity supply comes from wind, according to the American Wind Energy Association. It is growing in California because wind is one of the cheapest ways to meet the 20 percent renewable mandate -- a threshold that could rise to 33 percent or even 50 percent under recent proposals.

The TID already is at 8 percent, including small hydroelectric plants, a geothermal system and a few solar installations. Large hydroelectric plants, including the one at Don Pedro Reservoir, do not count toward the target.

The neighboring Modesto Irrigation District has an 11 percent renewable share in its energy portfolio, mostly from wind.

Although the TID's wind system would be fairly large, it is much smaller than the nation's leader, a 736-megawatt system in Texas.

The district would sell the bonds to investors and repay them, with interest, from ratepayer money in the years ahead.

Weis said the project would be practical at an interest rate of 5.5 percent or lower. The bond market has been uncertain because of the nation's financial crisis, so the district included the opt-out clause.

"All we're doing is insuring we can buy it the way we want to buy it," Malaski said.


John Holland
Irrigation District to Give Wind a Chance
The Modesto Bee, December 17, 2008

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