Community wind basics
Wind energy projects that incorporate local financial participation and control are known as “community wind” projects. Community wind projects encompass a wide range of sizes and project types. Examples include:
- 1- to 100-kilowatt, net-metered home and farm-based systems
- Mid-size, singe-turbine projects at schools and businesses
- Wind-diesel village power projects
- Multi-megawatt wind farms owned by co-ops and munis
- Wind farms comprising tens of megawatts and an independent power producer arrangement
The smaller size and local ownership aspects of community wind provide challenges and benefits compared to conventional, third-party or investor-owned utility projects that are typically larger, more readily financeable and able to make efficient use of the Production Tax Credit.
Denmark and Germany built their early wind markets on the local ownership scheme, but U.S. community wind efforts followed later (beginning in Minnesota, then Iowa). Innovative policies, business models and financing were all required to achieve success, as well as local champions. But the efforts are worthwhile: Economic development analyses of community wind projects have shown increases in local economic impacts to be 1.5 to 3 times those of conventional projects.
Community Wind Working Group
Because of the growth and interest in this market niche, the American Wind Energy Association (AWEA) Board formed the Community Wind Working Group (CWWG) in 2009. The CWWG provides a forum to exchange ideas and successes, develop outreach efforts, support strategic analyses and affect federal and state policy.
What is a community wind project?
Local stakeholders want to play an even bigger role in the use and development of wind energy. Individual landowners have a personal stake in the success of wind development and are looking for ways to maximize the value of wind for their communities. Local communities, including agricultural and rural economic development interests, want the opportunity to invest in wind in their backyards. A fundamental attribute of a community wind project is that the community has a tangible interest in the project.
For the purpose of developing policies to expand development of these projects, community wind projects include the following:
- Any wind project of 20 megawatts or smaller in nameplate capacity is a community wind project if it:
- Meets this condition: Projects larger than 20 MW cannot be separated into smaller projects to meet this 20-MW project size limit. Specifically, more than one qualifying community wind project cannot be built within 5 miles of another qualifying project within a 12-month period and using the same interconnect.
- Meets one or more of the following conditions:
- A local governing body (e.g., town, county) passes a resolution supporting the project; and/or
- Members of the community are offered the opportunity to participate in an ownership interest in the project and are involved in the decision-making process during the project's development; and/or
- The project’s local benefit is demonstrated in terms of: retail power costs, benefits to the local grid (or the project is incorporated into a micro-grid), or resolving remote power issues.
- A project between 20 MW and 100 MW in nameplate capacity is a community wind project if local owners own at least 33.3 percent of the project.
- Local owner includes any:
- Individual who resides in the same state as the project or within 250 miles of the project (and within the U.S.)
- State department or agency, tribal council, school, town and other political subdivision located in the same state as the project
- Municipal, cooperative and similar publicly owned utility
- Corporation or other similar business entity of which at least 51 percent is owned by one or more individuals who reside in the same state as the project or within 250 miles of the project (and within the U.S.)
- Not-for-profit corporations and similar nonprofit entities.
- 33.3 percent ownership is measured at the “commercial operation date,” a recognized term in the wind industry typically meaning the date at which the project is capable of and actually produces electricity. Local owners must own the project for some period of time thereafter.
Community Wind Project Database
View a list of community wind projects installed in 2011 and 2012, according to the AWEA U.S. Wind Projects Database.