Wind power showdown set in Austin 

To get a sense of how contentious Monday’s hearing about where to build a massive electric transmission line through the Hill Country will be, consider this: It’s being held at the Austin Convention Center.

That’s big enough to hold more than 1,000 people – and there are easily that many with a stake in the outcome.

At the forefront of the fight are Hill Country landowners opposed to the idea of cutting a football-field-wide swath through more than 130 miles of private ranch land, to erect massive lattice towers for lines that will bring power from West Texas wind to the state’s more populous areas.

Also expected is a big pack of lawyers: for the landowners, for wind companies that need the lines, for the cities and counties in favor or opposed, for the Public Utility Commission, which will decide in January where to site the line, for the Lower Colorado River Authority, which has the task of building the line … the list could go on and on.

The hearing isn’t about whether the line should be built, only along what route.

That’s because the 2005 state law that directed the lines be built specifically mandated that the question of need be removed from the process.

But some of the very lawmakers who authored that law, under pressure from constituents, since have asked whether some of the planned lines still are needed.

The Electric Reliability Council of Texas, which manages the state grid, has reported back that two segments could be rejected in favor of beefing up existing lines.

But regarding the line causing the most heartburn, which would run from McCamey in Schleicher County through the Hill Country to Kendall County, ERCOT reported back that there is no cost-effective alternative to building the new line.

There simply is too much wind power being generated around McCamey that needs to be moved east, the report indicated.

In a way, Texas has become a victim of its own success in developing wind energy.

Wind capital of U.S.

The Lone Star State, hardly famous for its environmental activism, now leads the nation in wind power by an exponential degree, with 10,000 megawatts of installed capacity.

There’s so much wind energy that existing lines can’t carry it all where it needs to go. That congestion raises the price of power, as utilities pay additional fees to get wind delivered.

On the windiest days, congestion is so great that turbines sometimes are forced to shut down.

The roots of Texas’ thriving wind industry took hold with the state’s decision in 1999 to deregulate its electricity industry. That effort created some odd alliances, many of which persist today.

Environmentalists, who wanted cleaner air and more renewable energy, joined forces with utilities and other business interests that wanted a competitive electric market, in what Tom “Smitty” Smith, director of Public Citizen Texas, called “a grand bargain.”

He offers one story to illustrate the strange mix of interests: Sam Wyly, one of then-Gov. George W. Bush’s biggest donors, founded Green Mountain Energy in 1997, hoping to sell “green” energy to consumers.

To do that, though, Green Mountain needed both an environment in which consumers could choose an electricity provider and a mandate from the state that would make sure a market for green power existed.

At the same time, Smith said, Ken Lay of Enron, which had extensive wind holdings in the state at the time, also was looking for buyers.

“So two of Bush’s biggest donors say, ‘We’re looking for a wind market in Texas,’” Smith said.

The 1999 law that created competition in the electricity market also established what’s known as a renewable portfolio standard, or a mandate that a certain amount of the state’s generation capacity come from renewable resources. Specifically, it called for an additional 2,000 megawatts by 2009.

It also said a certain percentage of each energy provider’s portfolio must include renewable power, based on market share.

In response, wind farms began to proliferate around McCamey and other West Texas towns. Pretty quickly, it became clear that existing transmission lines couldn’t handle all the added power.

The practice in the past had been to build transmission lines once power plants are under way. But a wind farm can be completed in a year’s time or even less, while it can take five years or more to get transmission lines built.

“It became a chicken-and-egg problem,” said Mike Sloan of Virtus Energy.

Power line law

ERCOT and the PUC recognized the problem, said Sloan, who has been instrumental in guiding state wind policy for more than a decade, but it took additional legislation to make it happen.

That was 2005’s Senate Bill 20, authored by Sen. Troy Fraser, R-Horseshoe Bay. It increased the requirement for renewable capacity by an additional 3,000 megawatts.

It also asked the PUC to designate “competitive renewable energy zones,” or areas of the state most conducive to renewable power construction, and to fast-track enlargement of the transmission system to handle the load.

Fraser, who co-sponsored the deregulation bill as well, said he supported both to help Texas diversify its electric portfolio, in part to reduce the state and the country’s dependence on foreign oil.

“We had no idea at the time that West Texas would benefit as it has,” he said of that positive side effect. “Diversification is simply good public policy.”

The next year, Gov. Rick Perry, flanked by wind industry executives at Southern Methodist University, announced he had received investment guarantees worth $10 billion from wind energy developers, in exchange for the state’s assurance that additional transmission lines would be built.

“Private companies are putting up their money instead of taxpayers putting up their money,” Perry said at the time, according to news reports. “The state of Texas will ensure we build the transmission capacity needed to deliver zero-emission power.”

And invest they did, to the point that Texas far surpassed its renewable energy goals.

Private investment

“A lot of people think we have wind because the government is forcing it,” Sloan said. “But we’ve now got five times the requirement. Extra wind was built because investors saw the potential.”

He said that investment also is a big reason Republicans, not always known for their commitment to green energy, have been so supportive of wind energy.

“Wind energy has literally saved West Texas schools,” said David Power, deputy director for Public Citizen Texas. “People in the Hill Country don’t want to see those wires, but many of those small towns have really benefited.”

Although it’s sitting out this particular fight, Public Citizen generally supports the CREZ lines, Power said, but also favors using existing rights of way and already disturbed land.

Hill Country opponents and others have put pressure on Perry, Fraser and other lawmakers to slow the process.

Sen. Jeff Wentworth, R-San Antonio, sent a letter to PUC and LCRA officials suggesting that “because of the wave of outspoken, intense opposition,” the process be put on hold until the Legislature convenes, “then let us handle it,” he said last week.

“Let’s have hearings before we go in and destroy the Hill Country,” he said. “I’m not sure there’s quite the need there was when we started this process.”

Fraser, who asked the PUC to re-evaluate the two segments officials now say aren’t needed, said he’s “absolutely supportive” of the process. He, too, wants the PUC to use existing rights of way and interstate highways as much as possible.

He acknowledged that doing so would increase costs but said it would be worth it to protect private property rights.

At the current estimated cost of almost $5 billion for the entire CREZ proposal, consumers would see an additional $3 to $5 tacked onto their utility bills each month for the next decade.

The hearing on the McCamey line is expected to last for two weeks.

Even as it goes forward, Virtus Energy’s Sloan acknowledges that anything could happen come January, when the Legislature convenes.

“Politics can derail anything,” he said.