A New York-based renewable-energy developer wants to build wind turbines in a number of Rhode Island and southeastern Massachusetts towns, which the company says could provide as much as 20 percent of the localities’ municipal electricity.
The idea is being shopped around by Allco Renewable Energy Group Ltd. LLC (a member of the Allco group of companies, along with Allco Finance Group Ltd. of New York and Allco NMTC Equity Partners LLC) – the same firm that advanced a stalled proposal for an 8-megawatt solar farm in Coventry (READ MORE) and that unsuccessfully bid to become the state’s preferred developer of an offshore wind farm.
Rather than have local taxpayers pay the wind project’s construction costs, Allco is proposing that the towns lease the company land for the project and then sign a power-purchasing agreement to buy the electricity it generates. Allco, in turn, would pay for construction and maintenance of the turbines.
William “Bill” Fischer, a spokesman for Allco, said the company will target between 10 and 12 cities and towns with high wind speeds, particularly in the East Bay. “I’m not saying it couldn’t work in northern Rhode Island,” he said, “but clearly, the best wind resources in the state are the lower East Bay and South County, and those are the towns that we’re focused on.” Having a dozen or so projects will also let Allco scale its costs, he added.
The benefit for the towns to working with a private firm is twofold, according to Fischer. First, the wind turbines would partly offset rising energy prices by providing a stable source for up to one-fifth of municipal energy needs. Allco can offer towns a stable price for wind power that will remain the same for 15 to 20 years, other than inflation adjustments, he said.
Second, cities and towns would not have to borrow money to pay for the turbines themselves, which Fischer estimates will cost $3 million each. Construction costs are also lower for Allco because private-sector companies are eligible for the federal renewable energy tax credits that were recently renewed by Congress.
The idea is gaining interest in local communities. After hearing presentations by Allco and other renewable energy developers, the Tiverton Town Council last week directed its town administrator, Jim Goncalo, to draft a request for proposals for a project. Potential locations that have been discussed include the town landfill or the public works yard.
“With the rising energy costs, especially electricity for one, it’s a situation where we have to look into alternative power for our town properties,” Goncalo said. He added: “I would imagine that the people would most likely be in favor of it, because it would be reducing our costs.”
Allco is not alone in promoting community wind farms, as the municipal projects are known in the industry. WindWrights – a Wakefield, Vt.-based energy developer that is part of the same company as Bristol-based SolarWrights (READ MORE) – is also discussing the idea with a number of communities in different parts of New England. The economics work out in places where wind speeds are more than 5 meters per second, according to the company.
“The political will seems to be getting stronger for building community wind projects, and renewables in general,” said Nils Behn, director of project development at WindWrights.
WindWrights is trying to set itself apart from its competitors by offering to handle the entire process, from permitting and grant-writing through construction and operations, on behalf of cities and towns.
The impetus for the new focus on community wind projects were new laws passed last summer in both Rhode Island and Massachusetts that expanded eligibility for net metering. Net metering allows energy consumers who have installed a small-scale renewable energy project to deduct the electricity they generate from the total number of kilowatt hours on their electricity bill.
In Rhode Island, the law raised to 2.25 megawatts the maximum allowed capacity of renewable-energy projects that can qualify for net metering. “That’s really the crux of this,” said Allco’s Fischer. “That law was significant legislation.” For wind projects, 2.25 megawatts likely would be generated by three medium-size turbines, according to Allco.
The new net-metering law also won praise last week in the state’s annual report card from the Network for New Energy Choices, a New York nonprofit, which graded Rhode Island’s net-metering policy a “B,” up from a “C” in 2007.
The community wind-farm projects being discussed by Allco and WindWrights are precisely what policymakers had in mind when they passed the new law, according to Karina Lutz, deputy director of People’s Power & Light, a local nonprofit that manages renewable energy purchasing programs and that advocated for the Rhode Island net-metering law.
“This is exactly the kind of unleashing of capital into the renewable-energy market that we hoped we would see from getting the bill passed,” she said.
The main barrier to wind projects at the moment is raising enough capital to construct them, because all of their costs are upfront. “No one ever has to come up with all the capital to build a gas power plant and all the fuel that it’s going to use over its lifetime,” Lutz said. A public-private partnership, she added, “helps solve the problem very nicely.” •
Allco Renewable Energy Group Ltd. LLC – part of the Allco group of companies, along with Allco Finance Group Ltd. of New York and Allco NMTC Equity Partners LLC – is a New York-based development and investment firm focusing on renewable energy projects including wind, biomass and solar power. Additional information is available at www.AllcoRenewableEnergy.com.
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