FINLEY NEWSLETTERS

THE GRID

COMMUNIQUE

Social Links

Empire District Hopes Answer is Blowing in the Wind

November 10, 2017 By Phil Carroll in

Following the lead of its new Canadian parent company, The Empire District Electric Company based in Joplin is making a big bet that the winds will be blowing strong and steady across the Missouri prairies and that natural gas prices won’t be spiking any time soon.

The company announced plans Oct. 31 to make a big move into using wind power to generate electricity, much of it to come from Barton, Jasper, Dade and Lawrence counties in Missouri. At the same time, the company is planning to retire their coal-fired Asbury generating plant 15 years earlier than originally planned. That plant currently has 55 employees.

Source: Lawrence County Record

In an Oct. 31 filing with the Missouri Public Service Commission, the company is requesting approval for a $1.5 billion project that would eventually add 800 megawatts of wind-powered generating capacity, with potentially 500 MW coming from sites on 40,000 acres in southwest Missouri on which Empire has obtained options to place wind turbines. Federal tax credits expiring in 2020 would cover about $800 million of the cost, leaving Empire’s total investment in the project at about $700 million.

For comparison, Algonquin Power & Utilities Corp. paid $2.4 billion to purchase the entirety of Empire District earlier this year.

The company currently purchases wind power from two wind farms in western Kansas, accounting for about 14 percent of the company’s power supply in 2016.

 The acreages on which Empire District has options are located primarily in Barton County, as well as northern and western Jasper County, extending into western Dade and northwestern Lawrence County. According to a map presented by the company, the properties run primarily in two swaths, from north of the Nashville community toward Mindenmines and Liberal in Barton County, and another from near the Maple Grove community in Jasper County and the Red Oak community in Lawrence County to the Dudenville community on the Jasper/ Dade county line, toward Golden City and Lockwood, then back toward the Kenoma community into Barton County. Properties were chosen based on wind speed maps generated by consultants, with landowner negotiations starting in April.

The project will require about 45 employees with technical knowledge in wind generation operations, a different skill set than that used by employees currently working at the Asbury plant.

The Asbury plant, which generates about 200 MW of power from burning low-sulfur coal shipped from Wyoming’s Powder River Basin, would be retired by April 2019 according to the company’s plans, more than a year and a half before the wind project would be completed. Empire Vice President-Operations Blake Mertens said that the company will rely on its generating partners in the Southwest Power Pool to make up for any shortfalls in generating capacity during the interim.

Wind turbines built using current technology can generate 2 to 2.5 MW of power, if the wind is blowing. Mertens said the turbines Empire is planning to use have 60 ft. blade diameter and would sit on a pole 500 ft. high, an altitude where average wind speeds are much higher than on the ground. There would be one turbine for every 30- 50 acres.

Mertens said that recent improvements in wind-generation technology, decreasing costs and increasing reliability of wind turbines now made the move practical for the area, where wind power was previously deemed too unreliable to support commercial generation projects. The plan is to develop more wind power options within 150 miles or so of Joplin.

“Over the last few years changes in the technology have made wind much more competitive,” said Mertens. “We estimated this will give our customers an average of $10 per month savings on their bill, and keep rate price increases from happening as quickly as they otherwise would.”

Mertens also noted that the company still has other thermal generation plants besides Asbury, including the natural gas-fired Riverton, Power Center (LaRussell), and State Line (jointly owned with Westar), as well as a minority share of the power generated by the Iatan plant north of Kansas City and the Plum Point plant in northeast Arkansas.

The Asbury plant was opened in the early 1970s as a mine-mouth plant, using locally-mined coal for fuel, and has been a traditional starting point for operations employees since then. It was converted to burn low-sulfur Powder River Basin coal in 1990 at a cost of about $30 million, then underwent upgrades in 2008 and 2015 that cost $32 million and $112 million, respectively, to reduce nitrogen oxide and mercury emissions. The most recent upgrades led to an increase in the average customer’s bill of about $8, as approved by the Missouri Public Service Commission.

Mertens said uncertainty over future environmental regulations and industry trends led to the decision to close the plant rather than attempt to sell it.

“There just aren’t any buyers for coal plants in today’s marketplace,” said Mertens.