A comparative analysis of business structures suitable for farmer-owned wind power projects in the United States
✍ Scribed by Mark Bolinger; Ryan Wiser
- Publisher
- Elsevier Science
- Year
- 2006
- Tongue
- English
- Weight
- 226 KB
- Volume
- 34
- Category
- Article
- ISSN
- 0301-4215
No coin nor oath required. For personal study only.
✦ Synopsis
For years, farmers in the United States have looked with envy on their European counterparts' ability to profitably farm the wind through ownership of distributed, utility-scale wind projects. Only within the past few years, however, has farmer-or communityowned wind power development become a reality in the United States. The primary hurdle to this type of development in the United States has been devising and implementing suitable business and legal structures that enable such projects to take advantage of tax-based federal incentives for wind power. This article discusses the limitations of such incentives in supporting farmer-or community-owned wind projects, describes four ownership structures that potentially overcome such limitations, and finally conducts comparative financial analysis on those four structures, using as an example a hypothetical 1.5 MW farmer-owned project located in the state of Oregon. We find that material differences in the competitiveness of each structure do exist, but that choosing the best structure for a given project will largely depend on the conditions at hand; e.g., the ability of the farmer(s) to utilize tax credits, preference for individual versus ''cooperative'' ownership, and the state and utility service territory in which the project will be located.