Wind Committee evaluates turbine options
Within two years, Jamestown may be profiting from its own energy use, and with minimal impact on the environment.
"Many of us on the committee are looking to more than maximize profits for the town, we're looking to maximize social benefi ts," Wind Committee Chairman Don Wineberg said.
That is if the Wind Committee gets all the green lights to build one .8-megawatt "net-metered" wind turbine, or a 2-megawatt "commercial" turbine at Fort Getty or Taylor Point, according to Wineberg. He said the decision should be made within the next six months.
Wineberg said the town applied for $1 million in funds with the Rhode Island Economic Development Corporation, and expects supplementary funds from Clean Renewable Energy Bonds, or 0 interest bonds from the federal government. The netmetered turbine would cost $2.8 million, and the commercial turbine would cost $6 million.
If CREBs are not available, Wineberg said the town would probably issue bonds.
The town has the ability to earn a profit, because state law requires electrical companies to reimburse the town $1 for every $1 of electricity generated by the turbine, Wineberg said. Any electricity generated which exceeds the town's need is then profit.
Wineberg said the expected profit over the lifetime of the netmetered and commercial turbines is $2.5 million and $4.3 million, respectively.
"That makes all the difference in the world in the way of turbines," Wineberg said. "It is them paying for themselves."
Daniel Mendelsohn, a consultant to the Wind Committee and member of Applied Science Associates, said the town consumes about $300,000 of electricity annually.
He said the town uses about 2 million kilowatt-hours a year, at an average rate of 15 cents per kilowatt-hour, which adds up to $300,000, the amount of money a turbine could potentially save.
But that amount could be larger or lower, because energy prices fluctuate according to economic conditions, times of the day, and other factors, Mendelsohn said.
"If you do it right, the town will not only save $300,000, the town will make money," Mendelsohn said, adding that the extra revenue could be used to pay off the bonds the town might need to sell to finance the project.
The turbine the town ultimately builds will be decided by the Wind Committee, which will have a lot to discuss. While the net-metered turbine is less costly, it also generates less electricity and less profit, Wineberg said.
But, electricity from the netmetered turbine will probably get a state-law guaranteed price floor, because there is "ongoing and universal" support in the state legislature to do so. Wineberg said the committee expects the price floor for net-metered turbines will be passed, but a price floor for commercial turbines doesn't have the same level of support.
Wineberg said this is because there has been less support for commercial turbines, because the general purpose of buying one is to earn profit.
And while the commercial turbine would generate extra electricity and more profit, its price, called the wholesale price, isn't yet guaranteed.
"The minute the minimum wholesale price comes up, it becomes immediately financially feasible," Wineberg said, adding that the committee will encourage the state to add a price floor on electricity from commercial turbines.
If the town chooses a commercial turbine, town officials would likely have negotiations with National Grid to obtain a sale price to put the wind power into the power grid. But, because that price doesn't have a legislation backed floor, Wineberg said, would be subject to economic conditions, and could go up and down.
"It should provide a floor for a reasonable, but not excessive, rate of return," Wineberg said.
Mendelsohn said the risk, even with commercial turbines, is low.
"It's like any financial investment, people use the word 'risk'," he said, explaining that careful negotiations would ease the worries of price fluctuations. "It doesn't have to be risky at all."
The feasibility will be scrutinized by the Wind Committee, Wineberg said, which spent some of a $55,000 grant on an extensive investigation, which included economic, energy and environmental factors. The Journal of New England Technology said $30,000 came from the RIEDC, and $25,000 came from the town, which Wineberg confirmed.
He said the committee will look into the report, deliberate for about a month, and hold two public workshops to entertain citizens' concerns.
A single net-metered turbine would be enough to meet the town's electrical needs, Wineberg said.
Mendelsohn said the town uses about .236 megawatts a year, which would be more than covered by the .8 megawatts that could be generated by a net-metered turbine.
But, Wineberg said, the Wind Committee has considered the blades of the turbine will not be turning all the time. As long as the blades are spinning about a quarter of the time, the .236 megawatt need of the town can be met, Wineberg said.
The commercial turbine would more than satisfy the town's need for electricity, even if the blades were only rotating 20 percent of the time, but the chance of the market rates reducing makes the Wind Committee hesitant, Wineberg said.
"But, for the commercial turbines … I'm sure the committee will not recommend we go forward with them unless the future rates break even or better," Wineberg said.
Other factors could slow the process. He said the size of the turbines might prohibit transportation across the Newport or Jamestown bridges. Wineberg said the net-metered turbine will be 73 meters high and the commercial turbine will be 80 meters high. He is also open to the possibility that there will be community opposition, like what happened on Cape Cod.
Wineberg said major opposition isn't likely, because the committee has been discussing the turbines for about 18 months, and he hasn't heard much, but some is likely.
"I'm hoping that it will be a small part of our process," he said. "We definitely expect there will be some people who will be opposed."
Mendelsohn would not give a definite answer when asked which turbine his firm would recommend to the town. He said the town will have to decide between the net-metered or the commercial turbine, but suggested the town should look to maximize electrical production.
"I can tell you that in the next 25 years or so, we're going to have to build another 25 percent of the (energy) capacity that already exists," he said.
He added that energy demand will outpace supply.