Kansas Wind Energy

KIMBERLY SVATY SENATE UTILITIES COMMITTEE JANUARY 10, 2017 What is ? Wind power is the ability to make electricity using the air flows that occur naturally in the earth’s atmosphere. blades capture kinetic energy from the wind and turn it into mechanical energy, spinning a generator that creates electricity. The three major types of wind power Wind is a type of , and there are three major types of wind power. ◦ Utility-scale wind, wind turbines larger than 100 kilowatts are developed with electricity delivered to the power grid and distributed to the end user by electric utilities or power system operators; ◦ Distributed or "small" wind which uses turbines of 100 kilowatts or smaller to directly power a home, farm or small business as it primary use; ◦ Offshore Wind which are wind turbines erected in bodies of water around the world. First US offshore wind project online fall 2016. How wind turbines work When wind blows past a turbine, the blades capture the kinetic energy and rotate, turning it into mechanical energy. This rotation turns an internal shaft connected to a gearbox, which increases the speed of rotation by a factor of 100 (from 18 rmp to 1800 rpm). That spins a generator to produce the electricity. Standing at least 80 meters tall, tubular steel towers support a hub with three attached blades and a “,” which houses the shaft, gearbox, generator and controls. Wind measurements are collected to automatically rotate the turbine to face the strongest wind and angle or "pitch" its blades to optimize the energy captured. A typical modern turbine is available to generate usable amounts of power over 99 percent of the time. It will start to generate electricity when wind speeds reach 6 -9 miles per hour (or 3 – 4 meters per second), and cut off at about 45 miles an hour (or 20 meters per second) to prevent equipment damage. Over the course of a year, modern turbines can reach more than 50-58 percent of their rated maximum capacity; that is as good as or better than most other forms of electric generation such as plants, which also don’t run 24/7. How wind energy gets to you

Windmills vs. Wind Turbines The terms “wind mill” and “wind turbine” are sometimes used interchangeably, but there are important differences. generate mechanical energy, but they do not generate electricity. People started using windmills centuries ago to grind grain, pump water, and do other work. Today's wind turbine is a highly evolved machine with more than 8,000 parts. Modern wind turbines harness wind's kinetic energy and convert it into electricity. What is a ? Wind turbines often stand together in a windy area that has been through a robust development process, in an interconnected group called a wind project or wind farm which functions as a single power plant that puts electricity onto the grid. How wind energy gets to you The turbines in a wind farm are connected so the electricity can travel from the wind farm to the power grid. Once wind energy is on the main power grid, electric utilities or power operators will deliver the electricity where it is needed. Smaller transmission lines called distribution lines will collect the electricity generated at the wind project site and transport it to larger "network" transmission lines where the electricity can travel across long distances to the locations where it is needed, when finally the smaller "distribution lines" deliver electricity directly to your town and home. www.awea.org/wind-energy-101 Benefits of wind energy Benefits of wind energy Wind power pumps billions of dollars into our economy every year, particularly into rural areas where 99.8 percent of wind farms are located; 70 percent reside in low-income counties. From 2008-15, the U.S. wind industry generated more than $128 billion in private investment. Wind energy supports 88,000 well-paying American jobs, including 21,000 manufacturing jobs (as of January 2016). The fastest-growing job in America is “wind turbine technician,” according to the Department of Labor. Wind energy is a drought-resistant cash crop that farmers and ranchers rely on to make a living and keep their land in the family. Wind farm owners make $222 million a year in lease payments (as of 2016). Local investments paid help rural communities afford teachers, ambulances, and roads. Wind investments are long-term 20-25 year, fixed price contracts for power Earliest recordings in history describe wind power use Wind mills on farms to pump water, later for small sources of light First large wind turbine erected during WWII 1970s energy crisis spurred industry growth Subsided crisis equated to waning American interest in new technology jumped on the American technology as they lacked the natural resources to power their own energy needs and transportation costs were much higher After 20 years of R&D and technology deployment, Europeans exported the technology back to the United States - Iowa first state RPS in 1982 - Federal Production Tax Credit instituted 1992 - Texas significant development under Governors Bush and Perry 2001 first commercial wind project operational in Kansas Wind powering the Kansas economy ◦ More than $10 Billion in new investment in 15 years in Kansas ◦ 12,000 new jobs across rural and urban parts of the state ◦ $16,000,000 in annual landowner payments* ◦ $10,000,000 in annual payments to the counties* ◦ Helped attract other businesses such as (Hutchinson) with 400 direct jobs and 450 indirect jobs and Mars (Topeka) with up to 400 direct and 475 indirect jobs ◦ Industry does not use or receive any State General Fund dollars ◦ 20 – 25 year fixed price contract providing long-term price stability and a hedge against fuel source volatility ◦ Lowest & fixed pricing driven demand from corporate & industrial purchasers

Like any industry, there is robust competition for jobs and capital investment. The states with stable and favorable environments win capital investment. 1.5 MW Wind Turbine Scale

Rotor Diameter 231 - 252 ft. Using 80 – 100 meter towers and 77 – 100 meter rotor diameter blades

Blade Tip Hub Height Height 213 to 262 ft 327 to 388 ft.

211 ft.

Boeing 747 Excavated Foundation With Spread Footings

400 yards of concrete 700 #s re-bar / cubic yard 140 tons of steel

55’ wide & 10 foot deep Tower Section

Base section = 16’ in diameter Tower Sections

3 sections + nacelle 80m = 262’ to rotor Tower = 148 tons Tower Installation Blade

Length =121’ 3 blades / WTG Weight = 7 tons / blade Diameter = 6 feet Tower/Nacelle/Rotor

Tower / Nacelle / Rotor = 248 tons Operation & Maintenance Fastest Growing Job in America – Wind Turbine Technician Wind is changing power generation portfolios

In 2015, Wind Generated Nearly 24% of All Electricity in Kansas

Wind, 23.90%

Other, 0.30% , 53.70% Nuclear, 18.90%

Natural Gas, 3.30% Coal Natural Gas Nuclear Other Wind

Source: AWEA U.S. Wind Industry Annual Market Report Year Ending 2015 Enough U.S. wind power for 20 million homes, led by Texas

Top states 1. Texas 2. Iowa 3. 4. Oklahoma 5. Illinois ** EY15 data

1Q17 Kansas 5,116.5 MW

Source: AWEA U.S. Wind Industry First Quarter 2016 Market Report Increasing contribution to the grid, reliably integrated

• By the end of 2016, Kansas likely to be powered by 30% renewable energy

• At times, wind has supplied more than 37% of the power across the SPP system

Source: AWEA U.S. Wind Industry Annual Market Report Year Ending 2015 Jobs across America

Top states for wind jobs in 2015 Texas (24,001-25,000) Oklahoma (7,001-8,000) Iowa (6,001-7,000) Colorado (6,001-7,000) Kansas (5,001-6,000)

Source: AWEA U.S. Wind Industry Annual Market Report Year Ending 2015 Roughly 500 component part facilities in 43 states including Kansas. At least 78% of the value of a wind turbine produced domestically compared to 25% in 2005. Kansans embrace our wind power resource Conducted by NorthStar Opinion, a national, well-respected polling firm with Republican ties

91% of Kansans support renewable energy 76% support increasing the use of wind energy 75% support 2009 RPS law of 20% by 2020 71% agree using renewable energy helps keep electricity rates stable 68% support increasing the RPS to 25% 73% willing to increase their monthly bill by $1 to increase renewables Kansas– 4 Mike Pompeo - 1586MW Congressman Dr. Marshall Wind power supporter Senator Moran Wind power supporter Policy stability drives growth

Experience confirms that policy stability is critical to the growth and overall success of any industry – wind energy included ◦ Federal ◦ PTC Phased out by 2019 ◦ Gradual 20% annual reductions in PTC value ◦ PTC helped quadruple America’s installed wind power from 16,702 MW in 2008 to 69,470 MW by the third quarter of 2015 … enough power to supply over 18 million American homes. ◦ Kansas ◦ RPS ◦ Siting ◦ Transmission With the 2nd/3rd best wind resource, Kansas has the opportunity to supply the US with power and the Americas and perhaps the world with component parts Policy stability drives growth TP&L (Transportation Partners and Logistics) yard on Jennie Barker Road and U.S. Highway 50 in Garden City, TP&L is an off-loading and distribution site for wind generation components that operates a section of rail near its yard that ships wind generation components. “We have 3,000 pieces sitting on the ground right now, and that’s the highest we’ve ever had,” said Billy Brenton, vice president and co-owner of TP&L. “We probably put 15,000 pieces through our yard last year.” “We’re in the center of the U.S. from the plants, so it makes sense for them to ship the parts here, and then we can provide what they call last-mile trucking,” Brenton said. All of the parts that make up the giant windmills — blades, hubs, the machine heads that turns the rotors, and tower pieces — are delivered from the site via trucks to wind farms under construction in Kansas, Colorado, Nebraska and as far away as Wisconsin. The pieces currently being stored at the TP&L yard are destined to four wind projects under construction. With the recent passage of the federal production tax credit extension through Dec. 31, 2019, Brenton doesn’t expect business to slow down any time soon. “Passing that tax just secured business for us in Garden City for the next seven years.” - Garden City Telegram January 10, 2016 World’s Largest Utilities Invest in Kansas Wind This statistic represents the world's largest electric utility companies as of April 1, 2014, based on market value. The value ascribed is in billions of dollars. The highlighted companies have wind energy investments in Kansas. EDF – 75.5 GDF Suez - 64.6 ENEL – 53.2 Duke Energy – 49.9 Iberdrola – 44.1 Dominion Resources – 40.9 NextEra Energy 40.9 Southern Co – 38.6 E.ON – 37.6 Exelon – 28.7 RWE Group – 25.1 American Electric – 24.6 SSE – 24.1 Korea Electric Power – 21.9 Tenaga Nasional – 20.7 PPL – 20.7 Fortum – 20.3 PG&E – 19.4 CLP Holdings – 19.2 PSEG Public Service Enterprise - 19 Kansas Wind: Vision For the Future 2001

First commercial 2005 wind project online 2009 112 MW, 170 2 wind projects turbines, 262 MW capacity 660kv 8 wind projects 2012 1,061.2 MW capacity KS led US in wind 2015 farm construction Wind is 21.7% 9 projects came power portfolio online totaling Power 994,000 1640.2 MW homes Kansas wind generation has doubled 4 times in 10 years Total 2,701.4 MW 2,865 MW operating and is about to double for the 5th time. Operational 2005 – 2006 1673.5 MW under 2006 – 2008 construction 2008 – 2010 2010 – 2013 2013 – likely end of 2016 Kansas Wind: Vision for the Future

2016

3,764 MW operational 2016/2017/2018 1,245 MW under construction Google, Microsoft 2030 5,116.5 MW operational by early announcements, GM 2017 Kansas Department of Commerce - estimates 7,000MW of wind for Governor Brownback announces export 50% renewable energy integration by end of 2018 DOE Wind Vision 20% by 2030 1800MW shy 2050 – wind largest source of electricity at 35% Comparative cost of generating technologies, fuel price risk

Comparison below show the range of renewable energy costs with and without federal production or investment tax incentives compared to generating technologies that have fuel price risk.

Source: AWEA combination of data from multiple charts in Lazard’s Levelized Cost of Energy Analysis – Version 8.0, available at: http://www.lazard.com/pdf/levelized%20cost%20of%20energy%20-%20version%208.0.pdf Cost falling with economies of scale

Source: LBNL Wind energy costs decline is leading the clean energy sector by a wide margin because of advanced technology Wind-generated electricity is two-thirds cheaper than it was six years ago The reasons wind energy is so affordable include: Improved turbine technology, with increased rotor diameters and hub heights Better computer analytics, so we know more about where to place the turbines and how to operate them as a unit; Networked sensors, and drones, so we can know more about when to maintain, before we have to repair or replace U.S. factories, which save on shipping large components from overseas New technology reaches higher winds, opens more regions

Wind resource at 80m turbine hub height Wind resource at 110m turbine hub height Wind output smooths out over large areas, can be forecast

Wind variability Wind uncertainty Kansas wind benefits ratepayers In January 2014, KCP&L announced a new wind energy purchase from a project in Coffey County. KCP&L stated the total benefits to their customers over 20 years included a $600M savings from wind power. In the case of Infinity’s power purchase agreement with Sunflower, the price was so low that Sunflower determined that it would have a neutral or negative impact on their customer’s rates. "Wind energy is produced for less than $0.03/kWh in today’s PPA environment, which is less than half of your retail rates," Matt Riley, CEO Infinity Wind Power before House Energy & Environment 2.14.13 Kansas City Board of Public Utilities just announced a new wind power purchase from a project in Rush County. They anticipate the project will provide approximately $900,000 in annual savings to customers. Fort Hays State University installed 2 Vestas wind turbines to help power the campus. The project came online in June 2013. The project forecasts an annual energy bill savings of nearly $1 million for FHSU. 65 Corporations are Committed to Going 100% Renewable

Source: http://www.wri.org/sites/default/files/corporate_renewable_energy_buyers_principles_1.pdf Operating Kansas Wind Projects Prepared by The Wind Coalition Project Name County Developer Size Power Turbine Installed In-Service (MW) Offtaker Type Turbines Year (MW)

Gray County Gray NextEra Energy 112 MKEC Vestas 660kW 170 2001 Resources LLC KCP&L

Elk River Butler Iberdola 150 Empire GE 1.5 100 2005

Spearville Ford enXco 100.4 KCP&L GE 1.5 67 2006 Spearville II 48 48 2010

Smoky Hills Lincoln/ TradeWind Energy 100.8 Sunflower – 50 Vestas 1.8 56 2008 Phase I Ellsworth KCBPU- 25 Midwest Energy – 24

Smoky Hills Lincoln/ TradeWind Energy 150 Sunflower – 24 GE 1.5 99 2008 Phase II Ellsworth Midwest – 24 IP&L – 15 Springfield -50

Meridian Way Cloud EDP Renewables 201 Empire – 105 Vestas 67 2008 Westar - 96 3.0

Flat Ridge Barber BP Wind Energy 100 Westar Clipper 40 2009 2.5

Central Plains Wichita RES Americas 99 Westar Vestas 33 2009 3.0

Greensburg Kiowa John Deere/ Exelon 12.5 Kansas Power Pool 10 2010 1.2

Caney River Elk TradeWind Energy 200 Tennessee Valley Authority Vestas 111 2011 (TVA) 1.8 Operating Kansas Wind Projects Prepared by The Wind Coalition Project Name County Developer Size Power Turbine Type Installed In-Service (MWs) Offtaker (MW) Turbines

Post Rock Ellsworth Wind Capital Group 201 Westar GE 134 2012 Lincoln Pattern 1.5MW

Ironwood Ford Infinity 168 Westar Siemens 73 2012 Hodgeman Duke Energy/ Sumitomo 2.3MW Corp. of America

Cimarron I Gray Competitive Power 165 Tennessee Valley Siemens 72 2012 Venture (CPV) Authority (TVA) 2.3MW NextEra Energy Resources LLC

Cimarron II Gray CPV 131 KCP&L Siemens 57 2012 Duke Energy/ 2.3MW Sumitomo

Shooting Star Kiowa Infinity 105 Mid-Kansas GE 1.6MW 65 2012 Electric Coop

Flat Ridge 2 Barber, Kingman, BP Wind Energy 470.4 AECI – 310.4 GE 1.6MW 294 2012 Harper & Sumner Arkansas Electric - 51.2 SWEPCO -108.8

Spearville 3 Ford EDF Renewable Energy 100.8 KCP&L GE 1.6MW 63 2012

Ensign Gray NextEra Energy 99 KCP&L Siemens 2.3M 43 2012 Resources LLC

Buffalo Dunes Finney, Grant, TradeWind Energy 250 Alabama Power GE 1.8 MW 135 2013 Haskell Operating Wind Projects in Kansas Prepared by The Wind Coalition

Project Name County Developer Size Power Turbine Type Installed In-Service (MWs) Offtaker (MW) Turbines

MJMEUC RPM Access Wind KPP Vestas Marshall Wind Marshall 74 36 2015 Development KMEA V110-2.0 MW

Lincoln Electric Buckeye Wind Ellis Invenergy 200 GE 1.79MW 111 2015 System & SPP

Western Plains Ford Infinity 400 Westar (280) Siemens 133 2017

Alexander Wind Rush NJR Clean Energy Ventures 49.5 KCBPU & Yahoo! Siemens 2.3 MW 21 2015

Waverly Wind Coffey EDP Renewables 200 KCP&L Gamesa 2.0 MW 95 2016

Slate Creek Wind Sumner EDF Renewable Energy 150 Great Plains Energy Vestas 2.0 MW 75 2015

NextEra Energy Resources 2015 Cedar Bluff Wind Ness & Trego 200 Westar GE 1.79 MW 111 LLC

NextEra Energy Resources Ninnescah Pratt 200 Westar GE 2.0 MW 100 2016 LLC

NextEra Energy Resources GE 1.79 MW Kingman County Wind Kingman 200 Westar 120 2016 LLC GE 1.715 MW Wind Projects Operational or Under Construction Prepared by the Wind Coalition

Project Name County Developer Size Power Turbine Type Installed Turbines In-Service (MWs) Offtaker (MW)

Kansas City Phase 1 Board of Public December 31, Utilities Vestas Cimarron Bend Clark Enel 400MW 200 2016 (200MW) 2.0MW Phase II Google 1Q2017 (200MW) Allianz Risk Ford Vestas Bloom Capital Power 178MW Transfer 54 2Q2017 Clark 3.3MW Microsoft Future of wind energy Successes Innovation driving down price ◦ Achieved 67% reduction in cost per kilowatt hour last 5 years Improved forecasting Continued R & D is driving new markets & buyers “Made in America” success story Reduced water consumption is on the forefront of change for the wind industry. ◦ Predict the cost per kilowatt hour to decrease by 41% in 5 – 10 years ◦ Impacts of energy storage on the wind industry will become clearer as the market evolves and distinct strategies emerge. Future of Wind Energy Challenges Policy stability Transmission investment Innovation is leveling the playing field Solar technology advances & rapid price decline Other disruptive technologies very likely in the next 5 – 10 years Questions?

Kimberly Svaty 913.486.4446 [email protected]