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Harvest the Wind: A Wind Energy Handbook for Illinois Handbook for Wind Energy A Wind: Harvest the Harvest the Wind: A Wind Energy Handbook for Illinois 2004 Harvest the Wind A Wind Energy Handbook for Illinois by Lisa M. Daniels Executive Director Sarah E. Johnson Program Associate Wes Slaymaker Project Engineer Prepared by for the Illinois Value-Added Rural Development Center, a division of the Illinois Institute for Rural Affairs at Western Illinois University 2004 Acknowledgements The Windustry authors would like to acknowledge the contributions of those who worked on the first edition of Harvest the Wind published as a limited edition in 1997. First Edition Principal Contributors and Reviewers: Rory Artig, Don Bain, Lisa Daniels, Skip DeLong, Paulo Dini, John Dunlop, Paul Gipe, Rick Halet, Brian Parsons, Michael Noble, Michael Tennis, and Tom Wind About Windustry Windustry is a nonprofit organization that works hands-on with local and community- based wind projects, providing technical support to create an understanding of wind energy opportunities for rural economic benefit. This work helps lay the foundation to build markets for locally owned wind projects in the Midwest as well as to help rural landowners and communities benefit more from corporate owned wind projects. Windustry, through its work with Wind Powering America, a U.S. Department of Energy initiative, the National Wind Coordinating Committee (NWCC), and Windustry’s new Wind Farmers Network, is working to create a wind energy knowledge base in rural communities around the Midwest. As part of this effort, Windustry organizes state, regional, and national wind energy forums aimed at moving the wind energy policy and project development dialogue forward, especially regarding community wind projects. Published by Illinois Institute for Rural Affairs Stipes Hall 518 Western Illinois University 1 University Circle Macomb, IL 61455-1390 [email protected] www.IIRA.org This publication is available from IIRA in print and on the IIRA website. Quoting from these materials for noncommercial purposes is permitted provided proper credit is given. First Prining: January 2004 Foreword Illinois, the Prairie State, has an abundance information and technical assistance to aid in of natural resources: from the wind and the decisionmaking process in wind energy waterways that carve and sculpt the state’s rich projects. As part of this effort, IIRA recognizes fertile soils to the minerals that lie beneath the need for an easily accessible publication the soils that provide fuel and raw materials that addresses wind energy experiences and for construction and manufacturing. Coal, in provides necessary steps to harvest wind in particular, has been a significant contributor Illinois. to the nation’s energy needs and the state’s economy. The state may now have a new Special thanks go to Windustry for preparing source of energy and revenue . the wind. this document under contract. Thanks to Mary Holmes, David King, and Norman Wind has the potential to make a positive Walzer for assisting me with the editing of the impact on our energy supply and economy initial draft and to Karen Poncin, IIRA, for due, in part, to improved technology and to preparing the material for publication. This the experience gained in development and handbook was made possible through funds production of wind generated electricity in from the Illinois Department of Agriculture, several states. Wind energy can be converted the Energy Community Foundation, and to electricity for individual use or as part of a the Illinois Clean Energy Foundation. This large-scale operation that distributes electricity document is also available on the IIRA website to residential and business customers. The (www.iira.org). Further information about state’s rural landscape should be explored to this project can be obtained from Roger identify key sites to harvest the wind and, Brown, IIRA, 518 Stipes Hall, Western Illinois therefore, enhance incomes and create jobs. University, Macomb, IL 61455. The Illinois Institute for Rural Affairs (IIRA), Roger Brown through its Value-Added Rural Development Project Director Center, is working to raise awareness of the value of wind energy by providing About the Illinois Institute for Rural Affairs Located at Western Illinois University, IIRA The value-added agriculture project is is designed to improve the quality of life administered through a unit of IIRA in rural areas by developing public-private known as the Illinois Value-Added Rural partnerships with local agencies on community Development Center. Through a variety development projects in rural areas. IIRA of research and educational efforts, the works on projects such as rural economic center educates agriculture and economic and community development (including development professionals regarding value- value-added agriculture), rural health care, adding opportunities for their area. Outreach rural education, rural public transportation, assistance is provided to these groups as they public management policies, housing, and organize business ventures that will increase technology. their income as well as expand employment opportunities in rural Illinois. ii iii Table of Contents Part I. The Fundamentals . 1 Chapter 1. Getting Started: An Overview of the Fundamentals of Wind Energy, Wind Energy Opportunities, and the Energy Industry . 3 A Briefing on the Fundamentals of Wind Energy and the Wind Energy Industry . 3 What Is Wind Energy? . 3 A Brief History of Wind Energy . 3 Overview: State of Wind Around the Globe . 4 Overview: State of Wind in the United States and Illinois . 5 Understanding the Opportunities . 6 The Potential of Wind Energy . 6 The Wind Energy Industry and Its Players . 6 Measuring the Energy in Wind . 7 How Wind Energy Is Transformed into Electricity . 8 Wind as a Commodity . 9 Options for Landowners . 11 Distributed vs. Wind Power Plant . 12 The Challenges of Harnessing Wind for Energy . 12 The Energy Industry . 16 Electricity and the Electric Grid . 16 Characteristics of Electricity . 17 For Further Reference . 18 Part II. The Value of Wind . 19 Chapter 2. Know Your Wind: A Guide to Assessing Wind Resources for Landowners and Prospective Wind Project Developers . 21 Acknowledgments . 21 Overview of Wind Resource . 21 Assessing Your Wind Resource . 22 Measuring the Energy in Wind . 30 What Information Do My Banker and I Need? . 34 Who Can Help Me? . 39 Chapter 3. Know Your Land: A Guide to Siting Wind Turbines for Landowners and Potential Wind Project Developers . 41 The Land . 42 Aesthetics . 42 Property Values . 44 Noise . 44 Public Safety . 45 Loss Prevention . 45 ii iii Biological Resource Impacts . 46 Construction . 47 Land Use . 48 Dismantling and Restoration . 48 Addressing Siting Issues . 49 Chapter 4. Know What Fits Your Community: A Guide to Permitting and Taxation of Wind Turbines in Illinois . 51 Neighbors . 51 Zoning and Permitting . 51 Permitting in Illinois . 52 Taxation . 55 Chapter 5. Wind Energy Economics: An Overview of Wind Energy Economics, Financial Incentives, and Tools for Analysis . 57 Risks and Rewards . 57 Economic Incentives and Financial Assistance Programs . 59 Tools for Economic Analysis . 64 Part III: The Opportunities . 67 Chapter 6. Small Wind Turbines: Special Issues and Resources for Small Wind Systems . 69 Small Wind Turbine Feasibility . 69 Applications . 69 Wind Resource . 69 Is Your Property Suitable? . 70 Economics . 70 Resources . 73 Chapter 7. The Market for Wind Energy in Illinois . 77 Early Markets for Wind . 77 Public Utility Regulatory Policies Act (PURPA) . 77 Emerging Markets for Wind . 82 Illinois Market Overview and Opportunities . 84 Additional References and Resources . 86 Chapter 8. Choosing a Business Structure . 91 Business Structure Options . 92 Chapter 9. Planning Your Project: A Guide to Some of the Practical Aspects of Buying and Installing Large Wind Turbines. 99 How to Choose the Best Wind Site . 99 Technology . 101 Interconnection and Transmission . 102 Projects Costs and Financing . 103 Operating Costs . 105 iv v Financing Wind Projects . 106 Part IV. Case Studies . 109 Case Study #1 Small Wind Turbines in Illinois . 111 Case Study #2 Mendota Hills Wind Project, Lee County . 113 Case Study #3 Illinois Wind Energy, LLC’s Crescent Ridge Wind Project . 115 Case Study #4 Community Ownership: Midwest Municipal Utility— A Wind Power Pioneer . 117 Case Study #5 School Ownership: Eldora, Iowa . 119 Case Study #6 A Pioneering Model for Farmer-Owned Wind Projects Minwind I and Minwind II, Luverne, Minnesota . 123 Scenario #1 Can Illinois Farmers Own Their Own Utility-Scale Wind Turbines? . ..
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