Going Green

Monday, September 10, 2007

Crop of the Future?

For farmers on the windswept High Plains, energy from wind may become an important crop.

Winds of Change Bring Investment Opportunities

Published on: Wednesday, September 05, 2007
Written by: Brad Zimmerman
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Farmers have traditionally tended everything from cotton to corn. But wind?

Cash crops come in all shapes and sizes, and giant energy-producing wind turbines have become the latest incarnation. Energy companies are paying top dollar to landowners willing to lease or sell space for wind turbines, and investors may want to follow the breeze.

The move toward wind energy is fueled by major energy companies trying to rack up clean energy credentials and state legislatures passing laws requiring increased use of energy from renewable sources.

Texas is becoming a pioneer in the wind market; many of its western plains feature the consistently high wind speeds capable of sustaining a productive wind farm. Wind speeds need to average 14 miles per hour annually to effectively power the 200-foot high wind turbines, according to Alliant Energy, an energy company serving the Midwest.

Besides strong gusts, expansive acreage is needed to catch sufficient amounts of wind. States such as Minnesota, Wisconsin and Iowa have the land and the necessary wind potential. Regions available to invest in are limited because of these constraints; expect to heavily scout the Midwest, where the most viable states are located.

To put into perspective what a wind farm is capable of, take Buffalo Gap, the third-largest wind farm in Texas. With its most recent expansion complete, it produces 354 megawatts annually—enough to power nearly 100,000 homes, according to the Dallas Business Journal.

Leasing space for wind turbines can net a landowner between $3,000 and $5,000 per turbine annually, according to the Texas State Energy Conservation Office. Lease agreements vary and can include monthly rental income and royalties. Typical leases last anywhere from 10 to 25 years, making wind farms a potentially viable long-term investment, as long as energy companies remain interested in wind energy. (see complete article here)

In the words of Bob Dylan, "The answer is blowing in the wind." -- well at least part of the answer.

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