Education  July 16, 2010

CSU partners with wind industry big shot

DEL MAR, Calif. – When it comes to developing monstrous wind farms around the world, Cannon Power Group has few peers.

The 30-year-old company has been putting together deals on wind energy developments from Croatia to India along with numerous projects in Washington and California, and is poised to begin work on a gigantic 1,000-megawatt wind farm in Mexico’s Baja California within the next year.

With all of that going on, Cannon has one more, much smaller project in its crosshairs: Colorado State University’s proposed 100-MW Maxwell Ranch wind farm about 20 miles north of Fort Collins.

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Gary Hardke, CPG’s president and managing director, said the Maxwell Ranch project is a respectable size.

“Up until the last four or five years, the average wind project was around 50 MW,” he said. “It’s only been in recent years that projects have really gotten big. There’s nothing wrong with a good 100-megawatt project, and we’ve done quite a few of those.”

Cannon Power Group signed a lease agreement with Colorado State University Research Foundation in June to design and develop the project on about 8,000 acres owned by CSU. The university’s former development partner, Wyoming-based Wind Holding LLC, defaulted on its contract when it couldn’t secure the estimated $500 million financing.

Hardke said he expects no problem obtaining financing for Maxwell Ranch.

“We have very strong sources of financing,” he said. “The only thing that really matters is that we’re able to go through a successful project evaluation process where we’ll address such issues as transmission lines, permitting – basically a ‘fatal-flaw’ kind of examination. If we can do all of that, I don’t see financing as being an obstacle.”

Wind power interest growing

Indeed, financing for wind projects has never been better. Cannon recently received a cash grant of $200 million from the federal American Recovery and Reinvestment Act to fund an extension of its Windy Flats/Windy Point project in Klickitat County, Wash.

Expansion of the project was expected to create more than 250 jobs and more than $32 million in community and state benefits. That’s in addition to more than 350 jobs and $145 million in local economic benefits already provided by the project.

Hardke said wind projects are finding lots of support from the federal government, which has declared a commitment to increasing the nation’s alternative energy supply, and from local jurisdictions.

“It’s really been on a rapidly ascending growth curve,” he said. “One of the things that is new is a realization and appreciation that local stakeholders now have for wind projects as being economic engines for local development.”

Hardke estimated that 75 percent of the jobs created by the Windy Flats/Windy Point project were filled by residents of Klickitat County.

“We’d be looking to do that very same thing in Colorado to maximize the local benefit to the community from the (Maxwell Ranch) project,” he said.

Curt Dreyer, Klickitat County planning director, said Cannon was cooperative throughout the permitting process for Windy Flats/Windy Point and that the project moved along smoothly.

“There were no major problems,” Dreyer said. “(The company) was cooperative in efforts to identify environmental impacts and to mitigate impacts.”

CSU impressed

Bill Farland, CSU’s vice president for research, said Cannon’s track record is impressive and a good indicator that the company will be able to make the project a reality.

“I think they represent a very successful developer and we are very interested in the work they did on the last project (Windy Flats),” he said.

Farland said the ultimate size of the Maxwell Ranch project remains to be finalized.

“The size of the project is really going to be determined by the developer,” he said. “Cannon will do their own due diligence to determine the size, but I think we’re still in the same (100-MW) ballpark.”

When it was first announced in 2007, the Maxwell Ranch “Green Power Project” was touted as eventually providing all of CSU’s electricity needs and enough surplus to sell to utilities and/or other higher education institutions in the state.

Farland said there is currently no specific target date for breaking ground on the project, which still must go through extensive permitting and citizen comment.

“That’s not our decision, it’s Cannon’s decision,” Farland said. “We’ve agreed to look hard over the next seven months at all of the issues. Ideally, we’d like to break ground within the next year, but that’s really their decision.”

Farland said once the project is completed, Cannon would have the right to keep it, sell it to a group of investors or sell it to a utility, as was done with Windy Flats. CSURF, as the CSU partner, would receive lease revenue and an agreed-upon amount of power from the project, both of which remain confidential at this point.

Hardke said it’s possible that Cannon may contract with Vestas Wind Systems to provide wind turbines for the project. He said the company has used Vestas turbines for some of its previous developments.

“We’re doing a project evaluation, and part of that is to decide which turbines would be the best fit depending on the particular wind conditions each site has, along with pricing considerations,” he said. “Certainly, Vestas would be on that list.”

Hardke said even though Cannon has many wind-farm irons in the fire, he’s not worried about the company getting spread too thin.

“We have a lot of folks who are very experienced, and we’ve worked together many years and can multi-task very readily,” he said. “The last thing we would do is commit to a project we couldn’t finish optimally.”

DEL MAR, Calif. – When it comes to developing monstrous wind farms around the world, Cannon Power Group has few peers.

The 30-year-old company has been putting together deals on wind energy developments from Croatia to India along with numerous projects in Washington and California, and is poised to begin work on a gigantic 1,000-megawatt wind farm in Mexico’s Baja California within the next year.

With all of that going on, Cannon has one more, much smaller project in its crosshairs: Colorado State University’s proposed 100-MW Maxwell Ranch wind farm about 20 miles north of Fort Collins.

Gary Hardke, CPG’s…

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