July 14, 2007
Wind power for the city

I like the sound of this.

Hoping to stabilize a $150 million annual electricity bill, Houston officials have negotiated a contract to ensure that a third of the city's power is generated by wind.

If approved, the contract would make Houston a leader among local governments across the country using renewable energy.

The mandate for wind as part of the annual 1.3 billion kilowatt hours needed to power city buildings, street lights and water plants comes from Mayor Bill White, who has made energy conservation a theme of his tenure.

"It puts us in a definite leadership position," said White, a former chief operating officer at the U.S. Department of Energy during the Clinton administration. "We are ahead of the curve."

City Council could consider the contract as soon as next week.

The mayor sought the changes after hurricanes Katrina and Rita disrupted the production and delivery of natural gas -- a common fuel at Texas power plants -- prompting electricity prices to soar.

The city spent roughly $150 million during the last fiscal year on electricity, paying a rate of roughly $91 per 1,000 kilowatt hours. Wind rates generally are cheaper, experts say.

City officials, who have seen Houston's electricity bills nearly double since 2004, hope the new source will help control those costs over the five-year deal, starting next summer.

"Since Katrina and Rita, we have been on a mission -- a mission to have diversity in our electricity portfolio," said Issa Dadoush, the city's building services director who helped develop the plan. "We can no longer do business the way we've been doing business."


The council is expected to consider an amendment to the current contract with the Texas General Land Office, which supplies the city's electricity under the State Power Program. Reliant Energy and the investment banking firm Goldman Sachs also were involved in the deal.

Once the contract is approved, the city can lock in a five-year fixed price for its wind power, depending on when market conditions are most favorable, officials said.

Goldman Sachs would offer the city electricity -- about a third of the average demand -- generated by a Shackelford County wind farm operated by Horizon Wind Energy.

Makes a lot of sense fiscally, and it's environmentally responsible, too. I like this a lot.

On a related note, here's a story about offshore wind farms, coming to Galveston Bay.

Right now there is a single modified oil platform supporting a new wind test station. Over the next year it'll tell engineers where, how high, and in what direction to place turbines much as you would see on land in west Texas or off-shore as it is in Denmark -- a country that gets a third of its energy from wind.

Eventually, over an stretch of 18,000 acres of water nine miles off the coast of Galveston, there could be 100 of those platforms out here. Each of them will be helping to generate wind energy. And the group believes there's enough here to power Galveston twice over.

Patrick Warren with Wind Energy Systems Technology said, "I think this is an integral part of energy production -- electrical production in the United States and the world."

It could fund Texas schools with millions of dollars. Right now the Texas permanent school fund gets a lot of money from off-shore oil and gas leases.

"Oil and gas are depletable resources," said Jim Suydam with the Texas General Land Office. "Whether it runs out in 10 years or 100 years, the state has to find a way to put money into that fund."

This lease is for 25 years and a percentage of any energy profits goes directly to the state. Texas could be uniquely positioned to benefit from a lot of leases, given that the state owns the land 10.3 miles off-shore. That's more than three times as far as any other state.

Suydam said, "We see a real future in this."

I do, too. I'm rooting for this to succeed.

Posted by Charles Kuffner on July 14, 2007 to Local politics