New wind projects still on hold
On Jan. 20, President Donald J. Trump issued an executive order, “Temporary Withdrawal of All Areas on the Outer Continental Shelf from Offshore Wind Leasing and Review of the Federal Government’s Leasing and Permitting Practices for Wind Projects.” The order effectively halted approval for new wind projects both off and onshore.
Three months later, new wind projects are in limbo, with no foreseeable changes on the horizon. Although the order does not affect wind farms that were already running prior to the Trump taking office, it has slowed wind energy’s progress.
“A review of utility industry trade press indicates considerable uncertainty regarding what this will ultimately mean for the onshore wind energy,” said Justin Grady, deputy director of the utilities division at the Kansas Corporation Commission. “For instance, if this order applies to the Federal Aviation Administration, and that agency’s issuance of a determination of no hazard to air navigation, that could mean an effective end to the development of new onshore wind energy installations, at least while this EO is in effect.”
For onshore wind right owners, it has meant a freeze on future projects that contribute to their income. Depending on the agreement made by the wind power company and the wind rights holder, landowners can receive between $3,000 to $10,000 per turbine in a year.
“Wind energy has historically been an economic source of supplemental energy for the power grid in Kansas,” Grady said. “When the wind is blowing, wind farms produce some of the lowest cost energy possible. Many utilities in Kansas use that low-cost power to keep bills affordable for Kansans. While tax credits help make wind energy more affordable, the best wind energy sites would likely still be economic, even without the tax credits because wind generation is a mature technology.”
According to the U.S. Energy Information Administration, in 2023, 10.2% of the U.S. utility-scale electricity was generated by wind turbines.
“While the wind industry faces many challenges today, including a transmission system that is at capacity in many areas of our state, we still see the potential for wind generation over the long term in Kansas,” Grady said.
But there is tremendous uncertainty right now in the industry for what this EO means in the long term for the onshore wind industry, he said.
“Also, there is currently a policy debate occurring in Washington regarding the future of the renewable energy tax credits for wind and solar,” Grady said. “Even without these tax subsidies, wind and solar are mature technologies that present an opportunity to add low levelized cost of energy generation to the grid. We can’t power the grid today with just wind and solar, but as supplemental sources of energy, they are economical today compared to other sources of energy production.”
Although Trump order indicates it is temporary, wind right owners should be prepared for an open-ended freeze on wind projects for the remainder of this term.
Lacey Vilhauer can be reached at 620-227-1871 or [email protected].
