Is Buffett’s Wind Power Attracting Facebook to Iowa?
Warren Buffett’s MidAmerican Energy has announced plans to bet $1.9 billion on wind power. The investment will be used to build additional wind farms in Iowa that will increase the company’s wind generating capacity in the state by about half and represent the single largest economic investment in the state, as officials told The Detroit Free Press. The result will be 656 wind turbines, which the utility company will construct by 2015.
Once the project is complete, the utility company — which services 714,000 people in Illinois, Iowa, Nebraska, and South Dakota — has estimated its Iowa customers will receive 40 percent of their electricity for wind. Now, wind generates approximately 25 percent of Iowa’s electricity, the highest percentage nationwide. The state is also considered the seventh windiest in the country, producing enough wind energy to power 1.1 million homes.
“That is marvelous news,” Harold Prior, executive director of the Iowa Wind Energy Association, told the Press Wednesday. “MidAmerican is one of the top utilities in the country as far as embracing wind energy.”
While officials said the the Iowa Utilities Board needs to first approve the expansion, the project will be a big boost to the state economically. The new wind capabilities will add 1,050 megawatts of wind generation, pushing the utility’s total to 3,335 megawatts of energy, and it will create 460 construction jobs for a period of two years plus 48 permanent jobs.
The expanded supply of energy is expected to hold down power costs for consumers, as MidAmerican Energy’s Chief Executive Officer William Fehrman told the publication. “The reality is that you’re avoiding any kind of increase,” he said, adding that the company will not transfer construction costs to its customers. In fact, the company has forecast that the added wind power will cut consumer rates by $3.3 million in 2015 and !0 million annually by 2017.
“This is real money back in the pockets of Iowans,” Iowa Lt. Gov. Kim Reynolds said, according to the Press. “This sends a larger message to the nation that Iowa is cutting edge, Iowa is innovative.” Currently, Iowa falls only behind Texas and California in its ability to generate electricity from wind, according to the American Wind Energy Association.
As far as innovation goes, the state’s boosted renewable energy capacity has already attracted the attention of technology giants. Facebook (NASDAQ:FB) announced last month that it would construct a $300 million data center in Altoona, Iowa, which state leaders expect will require an investment close to $1 billion over a six year period. The social network has already pledged to source 25 percent of its energy from renewable resources by 2015, and Fehrman said renewable energy was an important factor in the negotiations with Facebook.
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