24 May New report: Wind energy setback policy will cost Ohio $4.2 billion unless changed
COLUMBUS – A reasonable and common-sense change to restore Ohio’s wind setback policy to pre-2014 standards would result in over $4.2 billion in local economic benefits according to a new report released today.
Ohio’s current wind energy setback requirement is a government-imposed market barrier directly responsible for blocking over $4.2 billion in lifetime economic benefits for Ohio, including capital investment, tax revenue, and operational expenditures, according to a new study by the American Wind Energy Association (AWEA) and the Wind Energy Foundation’s “A Renewable American” campaign. The original setback requirements, addressing the minimum required distance between a wind turbine and property lines, were nearly tripled by a legislative change in 2014.
“Ohio has a rich wind resource – taking advantage of that resource will yield tremendous economic value for the Buckeye state,” said the report’s author, John Hensley, Deputy Director of Industry Data and Analysis, AWEA. “In fact, developers have plans to build more than 3,300 megawatts of new wind projects that would generate enough electricity to supply more than 900,000 homes. In addition to local capital investments totaling more than $2 billion, these projects would create more than 13,000 jobs and provide over $660 million in tax payments to local governments and schools. Landowners would reap the benefits of a stable ‘cash crop’ through land lease payments totaling more than $440 million over 30 years.”
Ohio now has one of the most stringent statewide setback laws for wind power development in the country. Not a single application for a new wind farm in Ohio has been submitted since government regulations were significantly increased by the legislature in 2014, with no science to justify the change, no evidence of problems, no public input or legislative debate.
“In Van Wert County, we represent both the promise of clean energy achieved and denied, since we have the largest wind farm built but others stalled due to Ohio’s overly restrictive setback requirements,” said Susan Munroe, President and CEO of the Van Wert Area Chamber of Commerce.
For the last seven years, Van Wert County has been home to the Blue Creek Wind Farm – the largest taxpayer in the county contributing nearly $2.7 million a year in tax payments that greatly benefit local schools and $2 million more in annual lease payments to local landowners. At the same time, several other projects in Van Wert County are on hold due to the 2014 change.
“The benefit to our public schools could be tremendous,” said Ken Amstutz, Van Wert City Schools Superintendent. “If several proposed projects in our community move forward, the potential revenue would provide for additional educational resources that would impact our students in a very positive way.”
Constructed in 2011 prior to implementation of the stricter setback requirements, the 152-wind turbine Blue Creek Wind Farm would, under current restrictions, accommodate just 12 turbines – far too few to be economically feasible.
The losses extend well beyond the tax revenues and land lease payments. In 2015, corporate purchasers of wind power exceeded traditional utility purchasers for the first time. The ability to construct and purchase utility scale wind has become an increasingly significant factor for corporations seeking attractive sites for new facilities.
In 2015, Facebook narrowed its options for a new facility after a 220-city search to Columbus, Ohio and Ft. Worth, Texas. In announcing its selection of Ft. Worth, Facebook also revealed that its new facility will be powered by a wind farm to be constructed 100 miles away.
If Ohio is serious about attracting major corporations, an essential next step is to remove the government-imposed barrier and allow the market to drive new wind development.
Like its neighbors, Ohio has the three key ingredients for success: good wind resource; plenty of rural and agricultural land; and access to transmission lines. Unfortunately, Ohio has just three utility-scale wind projects, all permitted under previous setback requirements. Ohio compares poorly to Illinois (with 26 such projects), Indiana (7), Michigan (21) and Pennsylvania (22). The U.S. wind industry has invested nearly eight times as much in Illinois, four times as much in Indiana, and three times as much in Michigan and Pennsylvania as compared to Ohio.
“The economic benefits are simply too great to ignore,” said Nate Strum, Executive Director, GROW Licking County CIC. “Ohio should take swift action to ensure that requirements are comparable to those of neighboring states. We should always strive to be an economic development leader – particularly at a time when state tax revenues are lower than expected and the economy is sluggish.” Licking County is home to a new Amazon fulfillment center powered by a northwest Ohio wind farm.
AeroTorque is a Sharon Center-based manufacturer of wind turbine component parts that currently supplies clutch and brake products to wind energy customers across the country and the globe, with little to no demand for its products in the Buckeye State.
“It’s hard to continue to add jobs in Ohio – where all our manufacturing has been done since 1978 – when our business is elsewhere,” said Doug Herr, Vice President of Sales and Marketing, AeroTorque. “Our company would prefer to put our wind products and expertise to use in our home state, but without a change to the setback law, that will be impossible. Put simply, when it comes to renewable energy development, resources do matter, but removing government barriers is often the key factor in determining which states are renewable-energy leaders.”