Harvesting Iowa Wind Energy Benefits

Date Feb 3, 2010
By James Strohman

Americans certainly recognize Iowa as a leader in the production of corn, soybeans, and hogs. Few might guess the Hawkeye State as such a prominent leader in wind energy.

Iowa has made a concerted effort to be a leader in wind energy and the state is now harvesting the benefits with new factories and jobs, sharp economic growth in the energy sector, and substantial new local revenue.

Iowa ranks second in the nation in wind energy production. The state now derives about 15% of total electrical demand from wind energy, far surpassing the national average of around 2%.

Wind energy activity in Iowa consists of three main areas: wind turbine operations, manufacturing of wind energy equipment, and electric transmission grid upgrades.

Over 2,100 turbines now dot the landscape of Iowa. That number could double or triple in a few years as MidAmerican Energy, Alliant Energy, and other companies bring new systems onto the grid.

Iowa has attracted many of the leading international wind manufacturers, who now operate plants across the state. They include Clipper Wind in Cedar Rapids, Siemens in Fort Madison, Acciona in West Branch, Sector 5 in Oelwein, Trinity in Newton, Goian in Ankeny, and Heartland in Mount Ayr.

As manufacturers role out more blades and companies erect more turbines, a major focus is underway to add transmission lines in order to transport power to end-users. Iowa is at the intersection of a wind energy superhighway and new lines will connect wind generation east from the Dakotas to demand centers in the Great Lakes region.

The State estimates 2,300 jobs have been created by the wind industry. Most are in manufacturing, and have helped buoy the loss from other companies, like Trinity's 500 new jobs to counter the displacement of 1,800 Maytag workers in Newton.

While active turbines are not major job producers, they provide substantial property tax revenue for local governments, ancillary economic activity, and revenue for landowners.

A good example is my area, Story County, where Florida Power and Light invested $270 million in a 100-turbine wind farm in 2008. The company's subsidiary, NextEra Energy, added 30 more turbines in 2009 and invested $20 million in a turbine repair facility on Interstate 35 at Story City. Another company, ITC Midwest, has invested $25 million to upgrade transmission lines through Story, Marshall, and Boone counties.

The initial 100-turbine farm in Story County will produce about $1.3 million in local property taxes each year and another $500,000 for local farmers as lease payments. Statewide, the 2,100 wind turbines will provide an infusion of over $27 million in new property taxes into the two-dozen counties with wind farms. That is substantial revenue for local governments, who are struggling to fix roads and bridges, and provide a myriad of services. Lease payments to property owners (typically family farms) now constitute a total boost of about $10 million per year to rural economies.

Iowa's investment in wind energy is paying dividends. Governor Culver deserves a great deal of the credit for aggressively approaching these international companies to locate in Iowa and a bi-partisan effort in the legislature has provided resources such as the Iowa Power Fund, loan programs, and tax credits. State aid to the wind industry is an example of how properly structured tax credits and incentives can provide intended benefits.

If Iowa can keep the blades turning, we can continue to foster growth, fortify local economies, and enhance our state image. During the economic crisis that is gripping the country, wind power just may help blow away the state's economic doldrums.

James Strohman is an Ames writer and serves on the Story County Board of Supervisors. He can be reached at jstrohman@storycounty.com