Austin Energy Invests in Wind Power

Yesterday, the Austin City Council approved the utility's plan to acquire over 4,500 acres in West Texas for potential wind farm development, with construction beginning as soon as 2013. Austin Energy will lease the land for 30 years, bringing the utility's total wind farm holdings to around 22,000 acres. Austin Energy will pay about $50,000 yearly for the new land.

The biggest hurdle to developing the land would be the additional construction of new transmission lines that are required to bring the wind-generated electricty to Central Texas. Austin Energy has already paid for around 4 percent of this cost, but there is still a long way to go. The state is scheduled to pick up most of the $5 billion cost of building the lines.

By owning its own wind farm, the cost to Austin Energy for providing wind energy would be half as much as it currently pays to purchase the power from private companies. Growing demand for wind power is continually driving up its price. "We don't want to be at the mercy of the marketplace," said Roger Duncan, Austin Energy's general manager. "Our overall strategy is to develop and own our own wind-generating capacity, and we think we'll get more certainty about prices that way."