This is the second in a three-part series tracking stimulus funds for renewable energy. Click here for part one.
GOLDENDALE, Wash. -- On an 80-degree day in this tiny rural town, winds gust up to 30 miles per hour, tossing tree branches and whipping hair into faces. Resident Cheryl Davenport smiles. She knows she's making money.
"It's a T & E day," said Davenport, 62, using jargon familiar to locals. "T & E," means "turn and earn," a mantra whispered to hundreds of windmills. Davenport sits on her porch on days like this, rocking in a chair and cheering spinning white blades, "Turn and earn, turn and earn."
Like many in Goldendale, Davenport and her extended family leased their expansive agricultural land to a wind developer. Turning turbines sitting on their property bring in about $200,000 annually, money divided among a clan of six. In a place where the per capita income is $32,550 a year, that supplies a healthy boost.
It is small town America in the age of clean energy promotion.
Windmills cover the town and the county it sits in, Klickitat, located near Washington's southern border. More than 600 white towers shoot out of rolling hills and flat pastures, creating a giant, white picket fence marching in multiple directions. Another 300 windmills are planned, and that number is expected to grow.
The power capacity of those online in the county already exceeds the total available in Colorado. Klickitat's windmills make enough electricity to power between 300,000 and 400,000 homes.
"That area has sort of become the epicenter of wind development in the Pacific Northwest," said Jeff King, senior resource analyst with energy planning organization Northwest Power and Conservation Council. The county, he said, attracted developers with "existing transmission, compatible land use, receptive residents and local government."
As the nation wrestles over its future energy policy, Goldendale and Klickitat offer a window into the changes that occur when wind comes to town. Residents tell a story both optimistic and cautionary. Wind, they say, brought stability to a place struggling with low wages, few industries and staggering unemployment. Wind development provided some new jobs and money for land owners who lease property to wind companies.
"It's helped us cover long-term debt, short-term debt," said Bruce Davenport, 55, who farms beef cattle and alfalfa hay and along with his family opened land to windmills. He is brother to Cheryl Davenport. "It's kind of a mortgage lifter and a nice shot in the arm with extra income."
Wind development at the same time has limitations. It hasn't transformed a poor town into a wealthy one. Green jobs haven't filled the gap left by the factories that closed and never reopened. And allowing wind projects required aesthetic sacrifices.
Goldendale sits 1,600 feet above the winding Columbia River, an area known as the Columbia River Gorge. Some people in Goldendale bought homes for open views looking out over the river and the sandstone hills of Oregon below. Those views now are gone. During the day, residents look at spinning windmills. At night, whirring white blades turn into a sea of flashing red lights. Federal rules require those lights as a warning for planes.
"This industrial-scale development with hundreds of wind turbines has absolutely transformed a natural landscape into an industrial landscape," said Michael Lang, conservation director with a local environmental group, Friends of the Columbia Gorge. "This landscape now has 200-foot-high turbines spinning around as far as you can see."
Klickitat, and counties across the country like it, illustrate the result of local, state and federal incentives for green power. Klickitat feeds energy into Washington, Oregon and California, all of which have mandates that utilities generate some renewable energy. That creates a built-in market, King said.
At the federal level, the 2009 stimulus bill created grants in place of tax credits for renewable developments, an incentive that has spurred some of the more recent Klickitat projects. Windy Flats, one of the biggest wind farms in the area with 114 turbines, received $218.4 million , so far the largest grant under the federal program (Greenwire, Oct. 14).
Developer Cannon Power Group of San Diego is expanding that project with an additional 39 turbines. Another Klickitat project called Harvest Wind, built by a consortium of public utilities, received $60.8 million from that grant program. And developers with projects under way said that they planned to apply for grants when they have finished construction.
But incentives like those might not continue. States are tightening budgets, and benefits given to wind development -- like the waiving of sales tax on construction equipment in Washington -- could disappear.
In Washington, D.C., House Republicans as part of their election platform "Pledge to America" have said that they would eliminate any unspent money from the $787 billion stimulus package, which could affect grants now available through 2013 for those projects that qualify. Even before GOP members unveiled that pledge, wind developers had been rushing to complete enough of their renewable projects in order to qualify for that money under the current law.
With wind towers costing about $3 million each, incentives are key, said Mike Canon, Klickitat's economic development director.
"They're incredibly sensitive to tax incentives and demand," Canon said of wind projects. "As long as development of renewable energy is being promoted and helped, they'll continue to grow, but they're sensitive to that."
Turning to windmills
A town of about 3,000 people, Goldendale moves at a relaxed pace. The sole drug store, KC Pharmacy , closes at 6 p.m. There is one stop sign and no traffic lights. There is not much crime, with no robberies all of last year and eight stolen vehicles.
"Everybody knows everybody and everything," said Brandy Myers, 32, Washington administrative manager for Cannon Power Group. Myers is the daughter of farmer Bruce Davenport. "If you need help they're there to help you; if you screwed up, they know."
Before wind, Goldendale was in economic shambles. Two of the largest industries had crumbled. Forestry jobs had been in sharp decline for several years. Then the local aluminum smelter shuttered its doors in 2001, eliminating about 600 jobs. The plant at its peak had employed more than 1,000.
When the plant closed, business dropped 40 to 50 percent at hunting and fishing equipment seller McCredy Co., said owner Dan McCredy, 50. He saw nine other businesses close within a month. McCredy laid off all five of his workers, he said, and ran the shop alone for two years.
Talk turned to wind as a possible savior. For years there had been discussions about windmills in Goldendale, a place with decent wind and, more importantly, available transmission with lines capable of moving power out of state. Bonneville Power Administration years earlier had put infrastructure in place for area dams.
"They first approached my husband in the mid-70s," said Ruth Davenport, 84, mother to Cheryl and Bruce Davenport and a town resident since 1932. "They came in, sat down at the kitchen table, told us, 'This is going to bring you $200,000 a year.'" The couple signed a conditional contract.
But, Ruth Davenport said, "It never happened." That developer pulled out and ended up building in Hawaii. "In the '80s and '90s we had other companies coming through," Davenport said, adding that one of those companies was an Enron Corp. subdivision. "The offers kept coming, but they didn't materialize."
Then in 2005 the town created the nation's first energy overlay zone. It expedited permitting for wind development, with the county pre-approving several time-consuming studies that must be done before windmills can be installed, Canon said, including research into the effect on birds and geology.
Just over two months later, large wind developers announced wind farm plans. One of the first to come in was Cannon Power Group, which built the Windy Flats project that has received the largest renewable energy grant under the 2009 stimulus bill. Before Windy Flats, Cannon built the Windy Point farm in Goldendale, which did not receive a grant.
There now are 18 wind farms built, in development or permitted in the county, created by large companies that include Iberdrola Renewables and enXco.
"It basically was a very big welcome mat to wind developers to say, 'We want you here,'" Iberdrola Renewables spokeswoman Jan Johnson said of the energy overlay zone. Iberdrola came to Klickitat in 2006 and now has two other projects under way and another in development.
Other incentives helped, Johnson said. Iberdrola plans to apply for the federal renewable energy grant for two of its ongoing projects when they are completed. Washington waived state sales tax on the equipment used in wind construction.
The county's available transmission played a big role, Johnson said. Iberdrola is among a few developers in Klickitat that sell their wind-generated power to California, which is scheduled to have the highest renewable electricity standard in the nation. Cannon Power Group also sells to California. Wind projects in Klickitat and nearby areas sell 60 percent of their power to the Golden State, said King, with the Northwest Power and Conservation Council.
Wind developers faced relatively little opposition from Klickitat residents, King said, and there was limited concern about wildlife.
Some Klickitat residents and land owners, however, fume about the number of windmills. A few do so quietly, like one longtime resident who said that windmills destroyed views at his dream home. He asked not to be identified by name because he knows everyone in town.
Another man who lives out of town but owns land in Klickitat called the windmills destructive.
"Our property is now surrounded by them and virtually worthless to us," said Daniel Parke, 52, who along with his wife, Tammy, 50, had hoped to retire in Klickitat, moving from their suburban Tacoma, Wash., home. Their 20 acres in Klickitat have windmills on three sides, Daniel Parke said.
Parke said there is a lack of education to land owners and pressure not to speak out against the wind developments. He plans to sue, he said, to force wind developers and governments to notify people that their property will lose value because of windmills. He said he has had real estate agents tell him that having the windmills all around has sharply cut the value of his land.
"The large land owners are going to make money. The windmill companies are going to make money. The county is going to make money," Parke said. "The small land owners when they go to sell, they're going to find out that their land is not worth much because of the windmills."
Windmills that the Parkes see from their home are part of Windy Flats. Developer Cannon Power Group rejected that wind farms hurt property values.
"The Klickitat County community overwhelmingly recognizes the very significant contributions our project has brought to the area as a whole -- in jobs, tax base and other economic benefits," said Cannon Power Group CEO Gary Hardke. "That said, I appreciate that there is a small minority who feel they haven't sufficiently shared in the project's benefits."
There are some indications wind has helped Goldendale's and Klickitat's finances.
The county's property tax base has swelled significantly, with wind driving much of the change, said Victoria Allen, county property specialist. Klickitat's taxable property value grew in 2010 to more than $3 billion, from $1.7 billion in 2006.
The larger property tax base meant that the school districts and fire departments can more easily ask voters to approve bonds, Allen said, the proceeds of which pay for new buildings and needed equipment. Voters are willing to do so, Allen said, because they know with the wind developers helping to pay the bills that their own property taxes won't increase.
In Bickleton, a town east of Goldendale, voters approved a bond sale to pay for a new school that will serve about 100 students. Existing elementary and high schools have failing heating, sewage and power systems, said Superintendent Ric Palmer.
"We're extremely small and rural. Everything the community does is through the school," Palmer said. "Now that the wind towers have come in, it's made it feasible for us to have something new again."
Sales tax revenues in Goldendale, meanwhile, grew about 50 percent from 2005 to 2009.
Measuring what it has meant for jobs is more difficult. The county's 9.3 percent unemployment rate in August was higher than the state average of 8.8 percent for the same period, Bailey said.
Town residents have filled many temporary construction jobs. During construction periods, Goldendale has felt small economic booms. Goldendale's Ponderosa Motel and Quality Inn and Suites were full for weeks.
They "had to go out and buy 'no vacancy' signs," Canon said, that "they never had before."
Permanent jobs are fewer. There are about 80 to 100 jobs on the 10 operating wind farms, including both technical and administrative positions, said Scott Bailey, regional economist for the Washington Employment Security Department.
"Goldendale lost 600 good-paying jobs when the smelter closed. You're not going to replace 600 jobs with wind power," he said. "But it's something."
Some permanent positions were filled by people outside the area, with wind companies bringing in people with technology expertise that town residents lacked. Iberdrola, however, said that the 15 permanent jobs on its sites were filled by people from Goldendale and nearby Bickleton. Several of Cannon Power Group's permanent jobs went to Goldendale residents, but at least one technical job went to an outside expert.
There is now a wind technology program at a nearby community college, funded by wind developers, that could supply future workers. That program did not exist when wind projects started in 2005.
Wind jobs are important but just part of the equation, said Hardke with Cannon Power Group. In addition to pre-construction, manufacturing, building and permanent jobs, he said, the Windy Flats development over its projected 20-year lifetime will produce $145 million in state and local economic benefits from taxes, rent and other payments.
"It's been a huge, huge shot in the arm for that community," Hardke said.
Who gets hired
Town residents disagree about how much wind jobs benefit those who do not work at the wind farms.
At Hot Rods tavern, a bar with wood walls and pool tables, bartender Trisha Williamson, 25, works more hours and makes more tips since the windmills arrived.
At the same time, Williamson explained, increases in customers and tips come in waves, tied to construction projects.
"The locals are the ones that keep us steady, keep us up and going," Williamson said as she served drinks to two customers.
Marie Gatz, 31, brought her résumé into Hot Rods in late August. She had been dropping off résumés at businesses up and down the street, she said.
Raised in Goldendale, she had lived in California but moved back to her hometown recently to care for her sick mother. Asked what impact the windmills had had on her job prospects, Gatz answered, "none."
Dee Dee Connor, 28, manager of the Golden Arms and Golden Sands apartment buildings, said her husband has been looking for a job since January.
"I know a lot of people who have been looking for a year," Connor said.
"For the town of Goldendale, we don't need wind turbines, we need businesses," Connor added. "Wind brings in people from out of town. It's not made an economic difference that I can tell."
But local restaurant owner Michael Kitchen, 55, sees clear boosts from the windmills, both to the town and to his own bank account.
Kitchen said that in the 1980s he put up three small wind turbines on his land. A few years ago a subsidiary owned by billionaire investor Warren Buffett decided to build a wind farm in Klickitat County and needed the right to use a piece of Kitchen's property. He sold lucrative rights of way.
"I made a lot of money by proxy," Kitchen said. He funneled between $80,000 and $100,000 into a new town restaurant, Windy Ridge. It features high ceilings, stained glass windows, exposed piping and an exposed brick wall, with a menu that offers grass-fed beef and other artisan fare.
On a Wednesday evening, seven of the 12 tables were occupied. Wind developments have boosted the business, which employs eight people, Kitchen said.
"A third of the guys that come in here work for the wind farms," Kitchen said. "They come in regularly."
While higher-paying jobs at wind plants might go to people from outside the area, Kitchen said, that is still a plus for Goldendale.
"If one person can make $30 an hour for being one of the wind techs, it goes through the entire community, all the way to buying a beer from me," Kitchen said.
Farmers reap benefits
Windmills have made one of the biggest differences to the property owners who lease their land to developers. For the most part they are farmers and ranchers, many of whom had struggled over the years to make enough money to keep their land, said Myers, with the Cannon Power Group and Davenport family. Farmers who could not earn enough have subdivided property and sold some of it off, anathema to many who have held homesteads for many generations.
"The ability to have backup income really gives them stability," Myers said.
Land owners get paid a percentage of profits from the windmills on their land, or in some cases per windmill. Different developers offer different contract amounts, Myers said.
"The rent is a percentage of the revenue generated by each turbine every month," said Hardke with Cannon Power Group. "So, it fluctuates from month to month based on how windy it was and how much electricity was produced during that month. But on average, it would equate to around $18,000 per year for each turbine."
Another resident said the sales pitch from developers estimates about $8,000 per year per windmill.
"Everybody negotiates their own rate," said McCredy with McCredy Co. store who is handling his mother's property in Bickleton. He negotiated with Horizon Wind Energy, which then sold the project to enXco. "They were telling us $8,000 is what we should expect."
"I've heard from farmers saying they don't pay as well as they promote them," McCredy said.
Driving her brown Chevrolet pickup, Myers, 32, takes a long, paved road that cuts through the property her family owns. She points to her home, her sister's, those if her aunt and uncle, mother and father. Her uncle lives on a ranch house built by her great-great-grandfather. Windmills fill the acreage around each of the houses.
Bruce Davenport and his brother, David, 50, own about 500 beef cows that graze on the grass below the windmills. Before the windmills, he said, there were very lean years. Since the development, during two years when the cows fell ill from diseases, there was backup income.
"That was enough to turn the corner," Davenport said.