Siemens lands new MidAmerican blade order

Originally published in the Burlington Hawk Eye
Written by: Dale Alison, dalison@thehawkeye.com

Siemens Energy will provide blades for 67 new wind turbines MidAmerican Energy said Friday it wants to build in western Iowa.

The project is in addition to blades the Fort Madison manufacturer already is building for MidAmerican. President and CEO Bill Fehrman said the addition will bring MidAmerican’s investment in Iowa wind energy to $6 billion since 2004.

He said Siemens isn’t assured of the new order, but noted it’s an “exceptional company” providing the “highest-quality, lowest cost” blades.

Fehrman made the announcement Friday morning at a press conference with Gov. Terry Branstad and Lt. Gov. Kim Reynolds at the Statehouse.

The new developments for a wind farm in Adams County in southwest Iowa and additional turbines for an existing farm in O’Brien County in northwest Iowa will cost up to $280 million, pending approval from the Iowa Utilities Board.

Scheduled for completion by the end of 2015, it would add up to 162 megawatts of new wind generation capacity in the state. Fehrman said as a consequence MidAmerican’s customers’ energy bills likely will be reduced by $93 million over 10 years.

A representative from Siemens could not be reached for comment, but Sen. Chuck Grassley applauded the announcement.

“Renewable energy supports thousands of jobs and generates billions of dollars in investment across the country,” he said in a statement. “Wind energy is a big part of the picture and Iowa is at the forefront of taking advantage of wind as a natural resource. Yet more wind energy investment is good news for our state’s energy needs and economic development.”

Grassley considers himself the father of the wind energy tax credit, having sponsored the original legislation. He continues to sponsor numerous extensions, which now extend through 2016.

Coupled with projects already underway in Grundy, Madison, O’Brien and Webster counties, MidAmerican Energy will have about 3,500 megawatts of wind generation capability in Iowa by year-end 2015 – enough to provide energy for the equivalent of about 1.05 million average Iowa households, if the IUB gives MidAmerican a green light.

Branstad was enthusiastic about the announcement.

“MidAmerican Energy’s commitment to wind generation garners long-lasting benefits and makes Iowa a competitive economic force, not only in the United States but also in the world,” he said. “Iowa has attracted major tech companies, such as Google, Microsoft and Facebook, because of our low energy prices and commitment to renewable energy. MidAmerican Energy’s newest wind project will help the state meet the demand for renewable energy that is attracting major companies and high-quality jobs to Iowa.”

The governor pointed out the turbines will generate more than $40 million in additional property tax revenue over the next 30 years in the counties where the turbines are installed. In addition, there also will be payments made to landowners.

Friday’s announcement brings the price tag of MidAmerican’s most recent project to $2.2 billion, further eclipsing the $1.8 billion investment Orascom Construction Industries has in the Iowa Fertilizer Co. plant being built 15 miles from the Fort Madison Siemens’ plant in Wever.

No incentives, other than the production tax credit, will be used in the project outlined Friday, Fehrman said.

“Wind is now the No. 1 source of new electric generating capacity in the country, and Iowa derives a greater percentage of its electricity from wind than any other state,” Reynolds said at the press conference. “By taking advantage of the abundant wind resources we have here in the state, MidAmerican Energy is delivering a sustainable energy solution that will play an increasingly important role in powering Iowa’s future.”

MidAmerican provides power for much of western Iowa, but its territory also dips into the extreme southeast portion of the state to serve Fort Madison, West Point, Donnellson, Denmark and Wever. The company’s average residential rate is 11.6 cents per kilowatt-hour, according to 2013 figures compiled by the Edison Electric Institute.

Alliant Energy, meanwhile, provides service to cities in much of the rest of eastern Iowa. Its average residential rate is 13.52 cents per kwh, though Rob Hillesland, a spokesman for the Iowa Utilities Board, pointed out a precise apples-to-apples comparison is not possible in regulated environments because other factors, including transmission fees, must be factored into the equation.

Across the country, EEI said average residential rates ranged from 8.37 to 36.88 cents per kwh. The national average is 12.50 cents per kwh.

Alliant has its own electric generation project underway. In June, it started work on a $700 million, 650-megawatt electric generating plant in Marshalltown that will be powered with natural gas.

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