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SWEPCO’s Wind Catcher is not necessary

by Minden Press-Herald

The so-called Wind Catcher project might be better named the “Flak Catcher” for all the controversy it has stirred, although unfortunately that seems to have made little impression on Louisiana regulators.

Based in the Oklahoma panhandle, a cluster of 800 wind turbines would capture as much as 2 gigawatts of power and send it through transmission lines to Tulsa and points beyond – although the inefficiency of wind power likely means received output never will come close to reaching this ceiling. Much could go to northwest Louisiana’s SWEPCO, which would own 70 percent of the project.

Its Oklahoma partner (with SWEPCO owned by American Electric Power) started work on this in the middle of last year, then tried to leverage its progress to rush through that state’s approval process. Unlike any other large-scale effort of this kind ever attempted, the $4.6 billion plan would require ratepayers to guarantee payback plus profit beginning with power delivery in 2020. Louisianans would shoulder $900 million of that burden.

But an Oklahoma administrative law judge ruled the partner skirted regulations in trying to get approval in that state, including insufficient proof of need. Texas regulatory staff cited the same reason and disputed the allegation that the project will save ratepayers money over the long haul, noting that federal wind power production tax credits will expire by 2020 (hence the rush for approval), risks of inefficient production and SWEPCO’s historical cost overruns (plus onshore wind power typically costs per unit roughly triple that of fossil fuels when considering all factors such as reliability and subsidies), and risk of lower margins on projected sales.

If only Arkansas and Louisiana regulators were as careful and focused. In February, Arkansas’ staff recommended approval on the basis that SWEPCO provide a number of guarantees, including a cap on construction costs, qualification for 100 percent of the federal Production Tax Credits, and minimum annual production from the project. It also featured a pledge by Wal-Mart and Sam’s Clubs, which cast a long shadow over the state, to buy energy produced by the project.

Presented a similar deal, Louisiana’s Public Service Commission staff took the bait and last week announced in almost identical terms an agreement. As in Arkansas, another sweetener included assurances that the manufacturer of the turbines would have components for these built in all of the affected states except Oklahoma – driving costs higher still, as no American manufacturer makes turbines and thus the parts would have to be shipped abroad, assembled, and imported back.

LPSC commissioners almost always follow staff recommendations, particularly when it fits their ideology. In remarks broadcast last month, area Commissioner Foster Campbell seemed more interested in trying to impugn the motives of organized opposition to the project than in evaluating the data and deciding for himself.

Northwest Louisiana doesn’t need the excess capacity the project will produce and likely its costs will exceed its benefits. The LPSC shouldn’t expect Texas and/or Oklahoma regulators to bail it out and must reject Wind Catcher on its merits.

Jeff Sadow is an associate professor of political science at Louisiana State University Shreveport. His views do not necessarily express those of his employer or this newspaper.

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