Ambitious Developer Plans 1 GW Community Wind Farm In S.D.


Ambitious Developer Plans 1 GW Community Wind Farm In S.D. South Dakota-based developer Dakota Plains Energy wants to team up with local landowners in Lincoln County to build a community wind farm between 500 MW and 1 GW. The ambitious developer cites two main catalysts for the project: South Dakota's strong-but-underutilized wind regime and a nearby transmission project.

According to the National Renewable Energy Laboratory, South Dakota is the fifth windiest state, with potential to generate more than 882 GW of wind energy. However, the state had a total 784 MW of installed wind capacity by year-end 2012.

"We have an awful lot of wind. We should be embracing it, we should be monetizing it," says Rob Johnson, president and co-founder of Dakota Plains Energy. He refers to wind power as a "game-changer" for South Dakota.

Dakota Plains Energy began in the wind energy business in 2007 and started formulating its first project in early 2008. Dubbed the Campbell County Wind Farm, it is a traditionally financed project, and Johnson says construction on a 99 MW phase is slated to begin by December. The developer plans to eventually build the wind farm out to 300 MW.

The company principals, including Johnson, come from a background in real estate development. So while working on the Campbell project, Dakota Plains Energy traveled South Dakota looking for a prime spot to put another wind farm.

"We learned a long time ago in real estate development that if you wait for people to knock on the door, you'll starve to death. Nothing will happen," explains Johnson. "You go out and find the best location and figure out a way to put a project together."

About two years ago, the developer came across Lincoln County and did some due diligence. The county is located close to a planned transmission project, and Johnson says preliminary wind studies showed the region is promising. Dakota Plains Energy then prepared a business plan and engaged local landowners to see if they would be interested in moving forward with a project. As it turned out, they were.

Earlier this year, some Lincoln County landowners and community leaders established Dakota Power Community Wind. The group formally announced "preliminary action" on the up-to-1 GW community wind farm last month, saying the project would help boost the county's economy.

"This wind energy plan is unique in being a truly community-based project," said Jim Fedderson, mayor of Beresford and Dakota Power board vice chairman, in a statement. "The economic potential for our area is tremendous, in addition to using South Dakota renewable resources to help solve our country's energy needs."

According to Dakota Power Community Wind, a 1 GW project would create over 1,000 construction and 70 permanent jobs, as well as lead to millions of dollars in direct investments. The entire project could have a $2 billion price tag.

Johnson explains that enrolled landowners in the project footprint would receive royalties and, conceptually, citizens across the state may have the opportunity to invest in the project should such a plan be approved.

"To bring this into a project that's really feasible, we need the buy-in, if you will, of the local residents and the potential stakeholders," he says, adding that he hopes to secure between 65,000 and 75,000 acres of land.

Making the connection

South Dakota may have a great wind regime, but according to Johnson, "Our problem is we don't need it here. We're a small state."

Therefore, he says South Dakota should make wind energy an exportable product. The main hurdle, though, is that the state has a lack of available transmission. "If we can figure out a way to break that transmission deadlock, we can really open up the doors for this state."

In addition to its wind potential, Johnson explains that he chose Lincoln County mainly because it is near the planned Rock Island Clean Line project. As proposed by Clean Line Energy Partners, the 500-mile HVDC transmission line project would deliver 3.5 GW of renewable energy from northwest Iowa and the surrounding regions to Illinois and other states to the east.

Hans Detweiler, development director of Rock Island, says the project is well under way and currently seeking regulatory approvals. He expects the line to be in operation sometime in 2017.

Dakota Plains Energy has been in discussions with Rock Island for quite some time and will seek to connect to the transmission line if and when both projects come to fruition. As of today, Johnson says the only formalization between the two parties is an executed memorandum of understanding.

"We are pleased that Dakota Plains Energy is interested in our project," notes Detweiler. "South Dakota is highly transmission constrained, and Rock Island Clean Line would create potential outlets for that energy to be delivered to PJM."

That said, there is a problem: Dakota Plains Energy would still need to build about 60 miles of transmission line to connect to Rock Island's western terminus in Iowa. Johnson anticipates constructing a 345 kV line and says the community wind farm must ultimately be at least 500 MW to make it financially viable.

"Can this be done? Yeah. Are we going to do 1 GW? I don't know," he says. "It depends on how much land we sign up and the response, but our modeling shows us that to pay for that 60 miles, we're going to need to have pretty close to 500 MW minimum."

Johnson says he has met with several potential developers, including Clean Line, that could handle the extension and other transmission work. As to whether Clean Line will be the one to build the extra 60 miles, Detweiler says, "It is too early to determine at this point."

Looking ahead
Dakota Plains Energy recently held meetings with over 200 Lincoln County landowners. According to Johnson, there has been an "amazingly strong positive response [and] absolutely no negative reaction to this point."

The developer's attorneys are in the process of formalizing some landowner option agreements, and Johnson expects to begin signing up acreage in the next few weeks. He is careful not to disclose anymore details.

Johnson hopes to begin erecting meteorological towers within the next two months, as well as to conduct other studies and seek necessary permits. In order to closely match Rock Island's timeline, Dakota Plains Energy wants the wind farm to come online by 2018. "We're already halfway through 2013, so we have to get moving," Johnson admits.Â

Nonetheless, Dakota Plains Energy is determined to develop the wind farm, whether it be 500 MW or 1 GW.

"We're a South Dakota company that wants to help our home state, so we are taking the challenge head-on and intend to do everything in our power to make this project a reality."

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