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Four companies announce $8 billion wind farm outside Chugwater

Four companies announce $8 billion wind farm outside Chugwater

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CASPER, Wyo. — Four companies unveiled a $8 billion proposal on Tuesday to generate electricity at a wind farm in Wyoming, store its power at a salt deposit in Utah and ship it to California during hours of peak demand.

Developers called the plan the “Hoover Dam” of the 21st century and said it would solve one of renewable energy’s longstanding problems, namely how to deliver wind and solar power at times when consumers need it most.

The wind farm, combined with the storage facility, will be able to operate much like a coal-fired power plant, they said, delivering baseline power to the electrical grid. Indeed, the project is expected to become operational in 2023, the year a coal plant is expected to shut down and free space on an existing transmission line running from Utah to California.

“It is dispatchable renewables, which is really the holy grail for renewable energy,” said Jeff Meyer, managing partner of Pathfinder Renewable Wind Energy, one of the four companies behind the project.

The proposal is a mix of old and new. Pathfinder Renewable Wind Energy has long planned a $4 billion, 2,100-megawatt wind farm near Chugwater. Duke-American Transmission’s plans for a $2.6 billion transmission line also have be in the works for some time.

Tuesday’s announcement was notable for the addition of a $1.5 billion storage facility, to be built by the partnership of Pathfinder, Magnum Energy and Dresser-Rand.

Renewable power producers have long struggled with how to deliver their electricity during hours of high demand. Solar power often generates power during the middle of the day when demand is lower. Wyoming wind power, which typically peaks in the afternoon and evening, is able to meet late-day demand but is less equipped to deliver electricity during the morning.

“I suspect that this compressed-air storage is likely the catalyst that has breathed new life into the Zephyr line,” said Lloyd Drain, executive director of the Wyoming Infrastructure Authority, referring to Duke-American Transmissions’ power line project.

Permitting for the project had stalled, but Tuesday’s announcement suggests work may begin anew, Drain said.

Under the proposal, excess electricity would be sent from the wind farm over a 525-mile power line to a five-mile long, two-mile deep salt deposit outside Delta, Utah.

Electricity there would be used to compress air into four underground caverns hollowed out of the salt deposit. During times of high demand, air would be released, turning a turbine to create electricity.

“The technology has existed since the 1970s,” Meyer said. “It is the matter of finding the right geologic formation. Not every salt dome is dense enough, big enough or hard enough. And not every salt dome is located 100 yards from the transmission line you need to connect into.”

The salt deposit is adjacent to an existing power line, which now sends coal-generated electricity to the southern California market. Power from the wind farm and storage facility will be sent on that line after the coal plant is shuttered.

The storage facility could yield 1,200 megawatts of electricity, enough to power 1.2 million California homes. It will also be able to store solar power generated throughout the West.

Compressed-air storage has been used at an Alabama power plant for 23 years, said Jim Heid, a senior vice president at Dresser-Rand in Houston.

The company, in tandem with Magnum Energy, has long eyed the Utah salt dome for a potential storage project. Salt domes are relatively rare in the West, Heid said.

“To us, Dresser-Rand, the combination is just a perfect fit for renewables that are not only coming online in Wyoming, but all over,” Heid said during a conference call announcing the move.

Michael Webber, deputy director of the Energy Institute at the University of Texas Austin, said compressed-air storage is increasingly being paired with wind projects.

Two CAES projects, as compressed-air storage is often called, are underway in Texas. The technology is also in use in Germany, he said. CAES is more economical than other storage technologies like batteries and easier to accomplish than pump storage in regions with limited water supplies.

“Storage is a difference maker for intermittent renewables like wind. It makes it firm and dispatchable,” Webber said. “This is something that is starting to take off as people realize storage is such a complement to wind.”

The project faces a series of regulatory hurdles.

Tuesday’s announcement comes in advance of a 2015 deadline from the Southern California Public Power Authority to submit plans for renewable energy and electricity storage. The authority is expected to issue a decision on the project within 18 months, the developers said.

The wind farm and transmission line face local, state and federal permitting processes as well.

Officials at Duke-American Transmission, a joint venture of Duke Energy and American Transmission Co., said they expect permitting of the 525-mile power line to take four years. Construction is anticipated to take another three.

The line follows much of the path originally proposed under the Zephyr transmission project, which would extend 850 miles from the wind farm to Las Vegas.

The new line follows the same path until Utah, though a Duke spokesman said it remains possible the line could still be extended to Nevada if there is sufficient demand for the wind farm’s electricity.

Permitting the wind farm itself, which is mostly on private and state land, is expected to take about two years.

Wyoming has the strongest onshore wind in the United States, Meyer said, making it an attractive place to site its development.

Financing for various aspects of the project come from different sources. The transmission line would be financed by Duke and American Transmission, respectively. Financing for the wind farm and storage project will be packaged by Guggenheim Investments, while Sammons Power Development will hold an equity stake in the two projects.


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