Is South Dakota ‘open for business’ for wind developers?

Posted on 03/08/2013 by Dan Haugen

(Photo by Joel Rivlin via Creative Commons)

A South Dakota legislative conference committee agreed Thursday on an economic development proposal that could help the state’s wind industry catch up to its potential.

Taxes on wind farm construction in South Dakota are currently the highest in the region —up to ten times higher than in Iowa, Minnesota or North Dakota.

The proposal lawmakers agreed to on Thursday would let developers apply to the state’s economic development board for up to a full refund of the state’s 4 percent sales tax for projects $20 million and larger.

“It’s really a historic bill,” said Bob Sahr, general counsel for the East River Electric co-op, a member of the South Dakota Wind Energy Association. “They definitely, in South Dakota, have put the ‘open for business’ sign out for wind developers.” →

South Dakota gives ethanol blender pumps a boost

Posted on 05/14/2012 by Dan Haugen

An ethanol blender pump in Baltic, S.D.

I spent a couple of days last week in Sioux Falls, S.D., where I had a chance to meet with some local energy contacts.

South Dakota has lots of wind potential, but not enough customers or transmission lines to fully capitalize on it.

A geologic formation in the state’s northwest corner might have potential for oil, but for now those hopes are speculative.

When it comes to home-grown energy, ethanol is king here. The state is home to 15 ethanol plants, and the industry directly employs nearly 900 South Dakotans.

My itinerary included visits to the South Dakota Corn Growers, ethanol producer POET, and the American Coalition for Ethanol, which is based in Sioux Falls.

A state grant program has helped make South Dakota a national leader in blender pumps, along with Minnesota and North Dakota.
→

Is the window closing for South Dakota’s wind industry?

Posted on 11/29/2011 by Dan Haugen

A wind turbine near White, South Dakota.

South Dakota’s wind-power export opportunity could be permanently bottle-necked by transmission issues if the state doesn’t act soon, an industry association is warning.

The South Dakota Wind Energy Association (SDWEA) is holding its annual meeting today in Watertown, where it’s releasing a pair of new reports on interstate transmission issues that give a new sense of urgency to the state’s industry.

The good news for the industry: The reports conclude that it could be economical to export South Dakota wind power to other electricity markets like Chicago, Detroit or St. Louis.

The bad news: If wind farm planning and development doesn’t accelerate in South Dakota, it could permanently miss out on the economic opportunity.

“It’s a lost opportunity, forever, and a lot of people don’t understand that,” says Steve Wegman, executive director of SDWEA.

A wave of new long-distance transmission projects, such as CapX2020, is on the horizon across the Upper Midwest. But new capacity on those lines will be assigned on a first-come-first-served basis, says Wegman. Because neighboring state’s policies have been more supportive of wind projects, those states have more projects in the pipeline and could absorb most of that new capacity.

“It appears that North Dakota could take all of South Dakota’s transmission,” says Wegman. “Once they put an interstate past your house and they don’t give you a ramp on it, you ain’t getting on. Ever.”

South Dakota has among the nation’s best wind resources — enough to theoretically generate half of the nation’s electricity needs. Even with its superior wind, however, it lags Iowa, Minnesota, North Dakota and other states in total installed capacity. As of this summer, it had 784 megawatts of capacity compared to 1,424 megawatts in North Dakota, 2,518 megawatts in Minnesota, or 3,675 megawatts in Iowa.

One factor limiting the state is its small population. The installed wind capacity it has now is enough to generate up to 26 percent of the state’s total electricity demand (more than half the state’s power comes from hydroelectric dams). In recent years, some in the state have started looking into exporting electricity as a way to grow the wind industry.

A 2010 study commissioned by SDWEA and the governor’s economic development agency estimated that a project to export 1,000 megawatts of new wind power would create 5,360 new construction jobs and generate $538 million in total economic activity. It would also require building more than 83 miles of high-voltage transmission lines and other transmission grid upgrades.

Transmission line projects can take decades to plan and build. If South Dakota wants to sell its wind power to other markets, Wegman says its best, and perhaps only, opportunity to do so is by getting wind developments lined up in time to be included on transmission projects that are already in the works.

Miss out on those and South Dakota could be waiting for another generation for similar transmission opportunities. Even then, it’s likely those markets to the east will have already secured all of the power resources they need, says Wegman, noting that electricity demand has been falling. That, he fears, could leave South Dakota’s great untapped wind potential permanently unclaimed.

Wegman says he hopes the report signals to transmission developers that connecting South Dakota wind to eastern markets is economically viable, but the other audience is state policymakers.

“You have to get good government tax policies,” says Wegman. “Just because you have high wind doesn’t mean they’re going to build a wind project here.”

Read the reports:

SDWEA Wind Energy Transmission Economics Assessment – Final (pdf)

SDWEA – Transmission Input from CapX v7 (docx)

Photo by windimages via Creative Commons

Midwest transmission buildout looks ahead to next phase

Posted on 08/09/2011 by Ken Paulman

A 345 kV power pole. (Photo courtesy CapX2020)

August 9, 2011

By Kevin Dobbs

CapX2020, the coalition of Midwest utilities already working on one of the largest transmission build-outs in the country, is now looking out even further at a plan to develop a second set of power lines.

Forecasting rising long-term energy demand, as well as the eventual need for grid upgrades, the future investments could total several hundred million dollars and involve multiple new electric transmission lines, covering parts of Minnesota, North Dakota, South Dakota, Wisconsin and potentially other states.

New rules recently issued by the Federal Energy Regulatory Commission (FERC) create a class of “multi-value projects” – those that support public policy requirements or bolster reliability – for which energy customers across the region pay for. Many future projects championed by CapX2020 are likely to have the multi-value designation.

CapX2020 is currently navigating the gauntlet of regulatory approval hurdles for lines already planned out, projects that amount to a nearly $1.9 billion investment.

As those projects march forward, planners are eager to get a jumpstart on a future build-out, one several years from actual work but one that CapX2020 members say will eventually be needed to serve growing local economies and increasing energy needs.

Given that it takes several years to get local government and state regulators to approve plans, owing to inevitable environmental and aesthetic concerns, it is necessary to constantly be looking out to the next decade, said Tim Carlsgaard, a spokesman for Xcel Energy, which is among the utilities spearheading the CapX2020 efforts.

“It can take seven to 10 years from the planning stages to actually clearing” all the regulatory requirements, Carlsgaard said. For the second set of lines, “we are only very early on. Everybody is doing the analysis work now, assessing what the needs are, what needs to be prioritized.”

Carlsgaard emphasized that second-stage ideas are only at a point of spitballing for possibilities, not formally planned projects, but some early focus has centered on these potential future lines:

– A line running from Ellendale, N.D., in southeastern North Dakota, to the Big Stone station near Milbank, S.D.

– A line running from Big Stone to rural Brookings, S.D.

– And a line running from La Crosse County, Wis., to the Madison, Wis., area.

Another project might include upgrading a line that runs from Granite Falls, Minn., to the Twin Cities area, Carlsgaard said.

Such projects would span several hundred miles in all, and Jared Alholinna, a transmission planning engineer at Great River Energy and a planner for CapX2020, said the cost of 345-kV lines is about $3 million per mile, meaning future build-outs would cost hundreds of millions of dollars.

The projects in the Dakotas and Wisconsin noted above are being reviewed by the Midwest Independent Transmission System Operator’s (MISO) board of directors for status as “multi-value projects,” meaning they would add widespread benefit to the region’s needs and be eligible for regional cost recovery. Under such cost recovery, customers throughout the Midwest chip in to pay for the project.

Having that funding as a backdrop helps explain why the possible future projects CapX2020 is eyeing align with MISO’s goals, but Alholinna said it is also because companies involved in planning transmission lines need to work on a region-wide basis to make sure that lines are not redundant.

“We don’t want transmission lines running parallel to each other,” Alholinna said. “So you have to coordinate with your adjacent utilities.”

And, when projects eventually move forward, planners have to coordinate extensively with landowners, environmental groups, regulators and others to both get their approval and determine which areas of the region need to be prioritized.

“It has to be vetted by a wide variety of stakeholders,” Alholinna said. “It can take up to 10 years from concept to construction, so that’s why we need to be looking way out.”

Kevin Dobbs is a senior writer for SNL Financial News, where he covers banking and economics. He formerly worked as a reporter for the Des Moines Register and as an editor at the Argus Leader in Sioux Falls, S.D. He is based in Sioux Falls.

This work by Midwest Energy News is licensed under a Creative Commons Attribution-NoDerivs 3.0 United States License.

Midwest holds 23 percent of “clean” jobs

Posted on 07/14/2011 by Molly Priesmeyer

When President Obama promised green jobs, he probably had bigger ideas in mind; ideas that relied on regulations, new standards, and policy initiatives that would lead to innovation. Still, despite the serious political roadblocks to feeding a green economy, a new report by the Brookings Institution, in collaboration with development company Battelle, reveals that green jobs grew at an annual rate of 3.4 percent (or by half a million jobs) between 2003 and 2010.

According to the report, green job growth still lags slightly behind the nation’s overall job growth, which rose 4.2 percent annually during the same period. The report categorizes “green jobs” as those being in clean-tech; waste management; transportation; appliance and building manufacturing; food production; and more.

If that sounds like a large swath of the job farm to call “green,” it is. And that’s often the problem with any sort of green jobs report: The inability to clearly define what makes a job “green” and the additional problem of compiling data based on elusive terms.

But there is some good news in the convoluted numbers: Clean-tech jobs, specifically, grew 8.3 percent per year, compared with the rest of nationwide job growth at 4.2 percent, according to USA Today. What’s more, median wages for clean-tech jobs were $46,343, compared with $38,616 for all other occupations across the country.

The report spells good news for the Midwest, too, which holds 23 percent of the nation’s clean jobs, according to the report.

From the report:

Many Midwestern and Southern metros like Louisville; Cleveland; Greenville, SC; and Little Rock—but also San Jose in the West—host clean economies that are heavily manufacturing oriented… Roughly 26 percent of all clean economy jobs lie in manufacturing establishments, compared to just 9 percent in the broader economy. On a per job basis, establishments in the clean economy export roughly twice the value of a typical U.S. job ($20,000 versus $10,000). The electric vehicles (EV), green chemical products, and lighting segments are all especially manufacturing intensive while the biofuels, green chemicals, and EV industries are highly export intensive.

So what does green job growth look like for the Midwest overall? Here are the annual growth rates by state, from 2003-2010:

Illinois: 3.1

Iowa 3.3

Michigan 1.9

Minnesota: 4.9

Missouri: 2.6

Nebraska 5.8

North Dakota 6.7

Ohio 2.5

South Dakota 1.1

According to the report, Grand Rapids, Michigan, lost clean economy jobs most quickly from 2003 to 2010. Even excluding potential job losses from closing establishments, it lost 9.1 percent of its clean economy workforce annually (a loss of nearly 50 percent over the entire period).

Toledo, Ohio, and Madison Wisconsin, represent in the Midwest in the Top 10 most-clean-oriented metros.

The other State of the Union

Posted on 01/28/2011 by Ken Paulman

Rare site: a wind turbine on the Pine Ridge reservation in South Dakota.

There was another State of the Union address last week – one that also attempted to lay out a clean energy plan that both parties should support.

On Thursday, Jefferson Keel, president of the National Congress of American Indians, delivered the 9th annual State of Indian Nations Address. Keel’s theme was one of Indian nations working toward prosperity and becoming “full partners in the American economy,” including through energy development.

One opportunity for tribal nations is energy development. Our deep relationship to the land and our reverence for the earth’s natural resources provide a clear course for our communities.

Tribes care for approximately ten percent of America’s energy resources, including renewable energy, worth nearly a trillion dollars in revenue.

And yet, only a handful of tribes have been able to successfully utilize these resources.

Keel cited the example of the Mandan, Hidatsa and Arikara tribes of the Fort Berthold reservation in North Dakota, who overcame a string of “49 bureaucratic steps” to open up their land for oil exploration. The oil revenue has been an economic boon for the long-impoverished tribes.

But if it’s that difficult to smooth the way for oil companies, you can imagine how hard it is for tribes to develop renewable energy.

→

Renewables on the reservation: A success story

Posted on 01/20/2011 by Ken Paulman

The lights of Mystic Lake Casino, just outside the Twin Cities.

Today’s story on the barriers to developing renewable energy on South Dakota’s tribal land paints a pretty bleak picture.

In addition to a byzantine patchwork of federal and tribal laws, a major obstacle South Dakota tribes face is a remote location that makes it difficult to develop economic resources.

For Minnesota’s Shakopee Mdewakanton Sioux Community, though, it’s a different story. Contrasted with the vast reservations of South Dakota, the Shakopee own a small 3,300 acre patch of land just outside the Twin Cities. That location has made it possible for the tribe to operate Mystic Lake Casino and an adjacent 600-room hotel, a cash cow that generates millions – perhaps hundreds of millions – of dollars in revenue for the tribe.

That financial clout has enable the Shakopee to develop their own renewable energy resources – an impressive portfolio that includes solar panels, geothermal systems, waste oil recycling, a biomass plant, and most recently, a 1.5 megawatt wind turbine that supplies almost all the residential power consumed on the reservation.

“Fortunately, we’re in a situation where we can not only move forward with the design and construction of these facilities, but we’re also able to fund them in a timely manner,” tribal administrator Bill Rudnicki told Minnesota Public Radio in a 2009 story.

For the Shakopee, renewable power is a way of carrying on traditions of environmental stewardship, but it’s also a matter of sovereignty:

Like many others across the country, the Shakopee Mdewakanton Sioux Community and its members are faced with growing energy demand, dependence on outside sources for that energy, and known environmental impacts associated with conventional energy sources. In response, the Community has been active in exploring local options to supply its energy needs.

What a difference location can make.

Photo by insipidlife via Creative Commons

South Dakota tribes struggle to reach energy potential

Posted on 01/20/2011 by admin

Some of South Dakota’s prime locations for wind power are on tribal lands that are notoriously difficult to develop. (Graphic by Robin Decaire for Midwest Energy News; Sources: BIA, AWS Truewind)

By Kevin Dobbs

Michael Jandreau, tribal chairman of the Lower Brule Sioux Tribe in South Dakota, regularly looks out over the wind-swept land that stretches before the tribe’s headquarter west of the Missouri River and imagines the possibilities.

“The obvious potential is here – the open land, all the wind that could go into the system and create so much energy,” Jandreau said. “And yet as much as we might like it to, nothing gets done; there are too many obstacles in the way of allowing progress.”

Entrenched poverty, geographic isolation and unique legal issues tied to the tribes’ sovereign status have conspired to prevent notable movement toward developing wind energy enterprises in Indian Country in South Dakota, a state routinely ranked among the top five in the country for its sheer amount of wind.

Which of these culprits gets more of the blame? It depends upon whom you ask. But the tribes’ collective poverty stands between them and developing projects on their own. The other matters join to discourage private developers.

→

A tale of two pipelines

Posted on 12/14/2010 by Ken Paulman

No, not this one. Not the other one, either.

An excellent story from Greenwire today on the controversy over new EPA greenhouse gas regulations briefly contained a common misconception about a proposed oil refinery in South Dakota.

First, a bit of background. The refinery, which Hyperion plans to build near Elk ~~River~~ Point, South Dakota (just across the state line from Sioux City, Iowa), would be the first new refinery built in the United States since 1976. It would essentially double the refining capacity of Minnesota, Wisconsin and the Dakotas combined, and would also double South Dakota’s carbon emissions footprint.

Two pipelines are involved: Keystone 1, built by TransCanada, is currently operating in eastern South Dakota, not terribly far from the Hyperion site. Keystone XL, which would also be built by TransCanada, is in the planning stages and has yet to be approved by the State Department.

→

Tag Archives: South Dakota