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SW Wind Farms to Supply Clean, Renewable Power for Less Cost than Natural Gas

Words by Andrew Burger
Investment & Markets

More than doubling the amount of clean, renewable electricity delivered to its customers, Xcel Energy subsidiary Southwestern Public Service expects to save some $590 million in fuel costs over the next 20 years, the result of having signed long-term power purchase agreements (PPAs) with three wind power farms – one in New Mexico, one in Oklahoma and one in Texas.

Clear evidence of the increasing cost competitiveness and substantial ancillary benefits of harnessing wind energy, the power purchase prices Southwestern executives have locked in, for the most part, come in lower than the cost of electricity from natural gas-fired power plants, an Xcel spokesman told Amarillo Globe-News reporter Kevin Welch.

Big advances in wind energy

Adding a total of nearly 700 megawatts (MW), the three wind power PPAs were signed with wind power farms to be built in Oklahoma, New Mexico and Texas that are expected to come online in 2015:

  • 249 megawatts (MW) from NextEra Energy Resources/Palo Duro Wind Energy Center located in Hansford and Ochiltree counties;

  • 199 MW from NextEra Energy Resources/Mammoth Plains Wind Energy Center located in Dewey and Blaine counties, Okla., near Woodward; and

  • 250 MW from Infinity Wind Resources/Roosevelt Wind Ranch in Roosevelt County, N.M., between the towns of Dora and Elida.

The combination of supportive federal, state and local government renewable energy policies, such as the wind energy production tax credit (PTC), and ongoing advances in wind turbine and systems technology have driven big improvements in wind energy economics. The overall cost of integrating wind-generated electricity on power grids ranged from $1-$7 per megawatt-hour (MWh), according to the U.S. Department of Energy's 2011 Wind Technologies Market Report.
Wind conditions in the Texas Panhandle are some of the best in the United States for generating power. In Texas and New Mexico, we have about 600 megawatts of wind energy on our system that we acquire through long-term power-purchase agreements with wind farm owners,” Xcel explains on its website.

“We also are required to purchase another 250 megawatts of wind power from qualified generating facilities. In late 2012, we began purchasing all the power from the newly completed, 161-megawatt Spinning Spur Wind Ranch.”

The big, big plus is that you get all that energy without all the emissions, land and water contamination, and overall environmental impact and footprint associated with coal and natural gas production and power generation. That means avoiding an awful lot in the way of catastrophic and chronic environmental health and safety risks and costs that can span decades or more – costs in terms of health, environmental quality, and dollars and cents that invariably and ultimately wind up being picked up by the tax-paying public and those that suffer directly and indirectly from the effects of coal and natural gas power.

Andrew Burger

An experienced, independent journalist, editor and researcher, Andrew has crisscrossed the globe while reporting on sustainability, corporate social responsibility, social and environmental entrepreneurship, renewable energy, energy efficiency and clean technology. He studied geology at CU, Boulder, has an MBA in finance from Pace University, and completed a certificate program in international governance for biodiversity at UN University in Japan.

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