POWERING UP
Bigger tax incentives mean bigger blades for Pennsylvania wind farms
Over the next few weeks, two large cranes will begin to pull down the hulking fiberglass blades from the 68 turbines at the Twin Ridges Wind
Farm.
The Somerset County facility, which was completed in 2012, is being prepared for a kind of industrial molting.
Bulldozers at the site are widening roads to make way for a new generation of wind components — longer blades, more efficient generators and electronic components.
It will cost Exus, the company that bought Twin Ridges last month, nearly as much ($200 million) to repower the wind farm as it cost Everpower Wind Holdings to build it a decade ago (around $250 million).
It’s fitting that Exus, a Hill District-based asset management firm founded by the same team that started and later sold Everpower, sees the value of refashioningan old idea into a new one.
When Twin Ridges is outfitted
“
One of the soft benefits of repowering is that, unlike when you’re first developing a project,
[there is no] fear of the unknown. By and large, people have gotten used to it. Townships have gotten used to them. Landowners have had more than 10 years of income.”
Jim Spencer
President and CEO,
Exus North America
with new blades and power boxes, it will be capable of producing 20% more power from the samefootprint, Exus said.
The job is easier the second time around, said Exus North America’s president and CEO JimSpencer.
“One of the soft benefits of repowering is that, unlike when you’re first developing a project, [there is no] fear of the unknown,” he said. “By and large, people have gotten used to it. Townships have gotten used to them. Landowners have had morethan 10 years of income.”
It’s not that the wind turbines at Twin Ridges are no longer working and need to be replaced. In Germany, which is about a decade ahead of the U.S. in wind development, Mr. Spencer estimated, turbines are still operating at 20 years old and repowering is still a nascent industry there.
But in the U.S., the average age of repowered turbines is 11 years, according to a U.S. Department of Energy analysis that tracked the wind industry through the end of 2022.
The difference between Germany and the U.S. is the production tax credit. The incentive is so attractive as to entice wind facility owners to swap out still useful equipment for new models sooner than they might have otherwise.
The new production tax credit can give wind power operators up to $33 per megawatt hour for 10 years.
For reference, last year the average wholesale cost of electricity on the PJM grid, which involves 13 states including Pennsylvania, was $50 per megawatt hour. That means a qualifying new wind facility within this territory could increase its revenue by more than 50% with the tax credit. And, critically, repowering a windfarm qualifies as a new project, as long as least 80% of the
An incentive ‘on steroids’
The U.S. has had a production tax credit available for new renewable power on and off for the past 25 years. It gives project owners 10 years of tax abatement, based on how much electricity their projects produce.
The last production tax credit was set to lapse at the end of 2022. But in August of that year, Congress passed the Inflation Reduction Act, a massive clean energy package witha new production tax credit.
“The revamped regime looks like the old one on steroids,” summarized a report on wind repowering by Tamarindo, a U.K.-based wind intelligence firm.
It estimated that by end of the decade about a third of the U.S. wind fleet will be slated for decommissioning.A large number of repoweringprojects may be on the horizon.
Actually, the trend has already begun, sweeping across the U.S. in the same direction as the first wave of wind installations — it started in California, which had some of the oldest and smallest wind turbines. “The old eggbeaters,” Mr. Spencer calledthem.
Brookfield Renewable, a subsidiary of one of the largest asset management firms in the world, repowered the largest wind project in the U.S. in 2022, when it replaced 300 turbines at the Shepherds Flat projectin Oregon.
“The implications of wind repowering go beyond this one asset,” the company wrote in a public filing. “In the next five years, we estimate that 200 gigawatts of global wind turbine capacity will age into being candidates for repowering around the world. That is the equivalent of about 240 Shepherd’s Flat assets overthe next five years.”
InOctober, NextEra Energy Partners, a Florida-based power producer, announced plans to repower 740 megawatts of wind over the next three years. With 8 gigawatts of wind in its portfolio — a capacity equal to about four Beaver Valley Nuclear stations — the company told investors to expect more of the samegoing forward.
GE, which is one of the major manufacturers of wind turbines, said in its annual report that it has repowered 1,275 turbines in the past threeyears.
Twin Ridges isn’t the first re powering project in Pennsylvania.
North Allegheny Wind in Cambria and Blair Counties is currently repowering 33 out of its 35 turbines, according to a permit filed with the state Department of Environmental Protection. The project, which is now owned by Brookfield, put new blades and generator components on top of the original towers and is plans to restart commercial operationsby June.
Powering up
What Exus is doing at Twin Ridges is called a partial repowering. This means the foundation and steel towers remain and are topped withnew components.
For its Highland North Wind Farm in Cambria County, Exus is consideringa full repowering.
“We may go in and tear out the foundation and everything,” Mr. Spencersaid.
A full repowering is basically like starting over on the same site. The towers come down to make way for bigger towers capable of supporting evenlonger blades.
At the Cambria County site, that would mean replacing 25 turbines with eight new ones for the same energyoutput.
Every year, wind turbines get biggerand more powerful.
The average rotor diameter of a newly installed wind turbine — the span of the circle drawn by its rotating blades — is around 430 feet, longerthan a football field, according to federal energy data. The average sizeof the tower is around 100 feet.
As more of these giants are replaced, there are concerns about what happens to all that steel and fiberglass.
“That’s been a huge criticism of theindustry,” Mr. Spencer said.
There are ways to recycle the materials, to grind up the fiberglass and use it in aggregate or road pavingmaterials, he said.
Exus has arranged for the Twin Ridges blades to be cut into pieces and transported to a company in Tennessee called Carbon Rivers that reprocesses the fiberglass into materials it sells to glass manufacturers or companies making compositematerials.