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Analyzing Economic Development Through Wind Power

July 22, 2013

Audio with Audio with Eric Lantz, NREL Senior Research analyst (MP3 3.0 MB). Download Windows Media Player. Time: 00:03:17.

Earlier this year, the National Renewable Energy Laboratory released its analysis of the economic development from new wind power generation and transmission in Wyoming and Colorado. NREL Senior Research Analyst Eric Lantz says the study was created to try and understand how the Wyoming wind resource could be used to provide low-cost wind energy to Colorado and also how Colorado's wind turbine manufacturing base could support construction and development of that facility, ultimately providing opportunities for economic development in both states.

He says there are two reasons Colorado would be interested in using Wyoming wind, even though there is enough wind in Colorado to meet the demand.

"Wyoming wind is truly world class. It's some of the best wind that exists on the planet. What that means is that you can get exceptionally low-cost wind from Wyoming in many cases. So, if Colorado was able to access some of that exceptionally low-cost wind from southeast Wyoming there may be a cost savings in terms of rate payers for consumers in Colorado. In addition, the wind resource in Wyoming actually isn't perfectly correlated with the wind resource in Colorado. So there's the potential opportunity that by adding some geographic diversity to the wind resources that serve the state of Colorado, there may be less variability in the amount of wind generation that the utility operators see on their systems at any given time during the day."

Colorado and Wyoming both were affected by the slowing U.S. economy over the past couple of years, according to Lantz, especially in the manufacturing and construction sectors. He says Colorado construction jobs decreased nearly 2% each year between 2000 and 2010, while manufacturing jobs decreased more than 3% each year during that same time. Wyoming saw a little less than 1% in manufacturing job losses each year during that time and construction jobs remained flat, according to Lantz.

"Construction and manufacturing are two sectors that have been hit relatively hard over the last decade. And this set of projects, really, that consists of the wind plant, the transmission line, and the natural gas facility, could actually offer an opportunity for new investment in both those sectors. So this is where this project kind of provides a unique opportunity for these states to realize some of the potential that exists there."

Lantz says this study shows that over a cumulative 20-year period—the typical assumed life of a wind plant—Colorado and Wyoming would see 3.7 billion in total economic output. On average, Lantz says there are 4,000 jobs created in the construction and development of these facilities during a 3-year period, as well as 400 operations-related jobs.

"Another notable piece here is that even though we're looking at transmission, natural gas, and wind generation, it really is the large wind facility that drives the vast majority of the impacts in both these states. And it really is that turbine manufacturing component that boosts the Colorado economy. And then it's the construction and operations-related activity and tax revenues that boosts economic development in Wyoming."

Overall, Lantz says the portfolio of infrastructure is a little more than 1.8 billion in new investment during construction and almost 30 million spent on these projects per year of operation.