Senior U.S. energy official to tour huge Oregon wind farm
The Shepherds Flat wind farm, in Gilliam and Morrow counties, is one of the largest in the world. Running at full capacity, it could power 260,000 homes. The project has also benefited from generous federal and state subsidies.Randy Rasmussen/The Oregonian
Deputy U.S. Energy Secretary Daniel Poneman is set to be in eastern Oregon on Wednesday to tour the giant Shepherds Flat wind farm, a collection of more than 300 wind turbines sprawling over 30 square miles of sagebrush in Gilliam and Morrow counties.
Shepherds Flat has been a headliner project for the region’s wind fleet. It is one of the largest wind farms in the world, with a generation capacity of 845 megawatts when all the turbines are running full throttle. As such, it has attracted high-profile equity investors such as Google, as well as scrutiny over its generous federal and state subsidies.
The U.S. Department of Energy did not provide a specific reason for Poneman’s visit, other than a tour. But an agency news release said the project “taps Oregon’s strong winds to generate up to 845 megawatts of emission-free wind power, enough clean electricity to power nearly 260,000 homes.”
The agency also noted that the project created 400 construction jobs and 45 permanent operations jobs “that helped the local rural economy. Shepherds Flat will also generate an estimated $100 million in tax revenue for the two counties during the next 15 years.
What the agency didn’t note was that Shepherds Flat was held up by White House officials as a prime example of wasteful federal subsidies, in particular a DOE loan guarantee. A memo circulated by senior White House officials in 2010 noted that the project’s owner, New York-based Caithness Energy, was “double-dipping” on $1.2 billion in federal and state subsidies. The incentives include a $500 million federal grant, $200 million in federal and state tax benefits from accelerated depreciation, $220 million in premium power prices attributed to state renewable energy mandates, as well as the DOE’s $1.3 billion loan guarantee, which has a value of $300 million.
Oregon approved $30 million under its controversial Business Energy Tax Credit program to support the project.
The memo concluded that Caithness had “little skin in the game” and that the project probably would have gone forward with or without the DOE loan guarantee.
“What’s more relevant than a three year old memo is the actual results delivered by this investment,” DOE spokeswoman Judith Kargbo said in an email Tuesday. She said loan payments had been made on time, jobs created and clean energy produced.
“The wind farm is helping make Oregon and the United States world leaders in wind energy production, while preventing nearly 2 million tons of carbon pollution a year — equivalent to taking 360,000 cars off the road.”
Caithness sold the project’s output to Southern California Edison to satisfy that state’s aggressive renewable-energy mandates. Caithness did not return a call for comment Tuesday.