Feb. 16, 2001The Clean Energy Funds Network has released an analysis of New York’s Madison Windpower project. This is the first of a series of case studies that are planned on projects that have been financed by state clean energy funds. The studies are intended to provide recommendations for similar projects in the future.
Through interviews with the project owner, PG&E Corp.; the developer, Atlantic Renewable Energy Corp.; the manufacturer/operator, Vestas; and the public funder, the New York State Energy Research and Development Authority (NYSERDA), the report is able to achieve a detailed estimation of the costs incurred.
Some of the report’s findings include:
* Capital costs exceeded the industry average, due in part to exchange rate fluctuations and the need to build a new substation, and in part to being the first movers in the region.
* Strong community acceptance, a good environmental fit, and good interconnection access with the power grid kept other costs lower than expected.
* Commercial lenders were offering only prohibitively high financing terms that the owner was able to overcome by financing the project “on balance sheet.”
* The $2 million awarded from the New York system benefit charge fund needed special packaging so the project could receive the federal production tax credit
The report concludes, “Unless spot market prices go even higher than they are now and stay that way for years to come, the Madison project will not make a profit relying on the commodity price alone.”
However, the amount of revenue that can be gained from selling green certificates, or the attributes of the wind power without an energy component, is not well-established and faces threats from competing market rules in the various states in the region.
A copy of the report is available on the “Case Studies and Reports” page at http://www.cleanenergyfunds.org . The Clean Energy Funds Web site has links and information regarding the 20 clean energy funds, including Systems Benefits Charges, that have been established in 14 states.
The Clean Energy Funds Network is a project of the Clean Energy Group. More information about the organization is available on the web site.