Texas Wind Energy
Economic Impact of Wind Energy in Texas
An initial investment in wind power plants creates a ripple effect of spending that will result in an overall increase in output, employment, and income in the economy, which will also increase spending in goods and services. This will generates a series of transactions that benefits suppliers, service providers, restaurants, retail stores, and other sectors of the economy. The success of the wind industry in Texas brings forth jobs and other economic activity that has had a tremendous impact in its economy.
Gross Economic Activity
Utility scale wind projects bolster jobs and generate tax revenue that helps improve schools and other public facilities, improving the overall quality of life. By 2012, there were 116 wind projects that were operational in Texas. These projects not only increase the demand for wind turbines, but it also increases the demand for other materials and supply input. The overall impact in the economy depends on the expenditures of wind projects and how they are spent locally. It also depends on the relationship between producers and suppliers at a local level. The construction and operation phase of a wind power plant is one of the driving forces of economic activity in Texas. 1000 MW of wind power developed in Texas generated approximately $260 million in economic activity during the construction phase and approximately $35 million in annual recurring local economic activity.
Construction
Most jobs on site and under project development require skilled professionals in engineering, construction, management, and manufacturing. These highly paid positions further increases economic development in the sate of Texas. About 75% - 80% of construction workers are residents of Texas. These workers boost the state’s economic activity through their spending salaries on several payments such as mortgage payments, insurance, childcare, education, bills, tax payments, and clothing. 1000 MW of wind power supported 2100 full – time – equivalent (FTE) jobs in Texas.
Operation and Maintenance
When the wind power plant goes into operation, permanent employees are needed to maintain the 20 – 30 year life expectancy of the plant. The majority of these positions are filled by people residing in Texas or by people who’ve relocated to Texas to hold these jobs. 1000 MW of wind power supported 240 permanent jobs.
Property Tax Revenue
Wind energy project increases property tax revenue base in local counties, which is then used to improve schools, parks, community programs, fire department, and other public services. 1000 of MW of wind energy generates about $7 million in property tax revenue.
Land Lease Revenue
Land leases provide a stable source of income for farmers and ranchers who lease their land to wind energy industry developers. Farmers and ranchers are also allowed to continue growing their crops or graze their cattle while the wind turbines are in operation. Although wind projects take up a lot of acres of land, the actual footprint of a wind turbine is small, and they are spaced far apart. The actual footprint of land that is disturbed by wind projects only amount to 2 – 5% of the total land. The average land lease revenue in Texas is approximately $5000/MW/year. 1000 MW of wind energy generates $5 million in annual income for farmers and ranchers who lease their land to wind developers.
Manufacturing
Texas is also now a leader in wind energy manufacturing. Manufacturers and suppliers support about 1000 jobs within the state. It also supports a higher number of induced jobs. More workers are able to spend their income a variety of activities that generate and support employment opportunities in other areas in the economy, such as restaurants, retail stores, and hospitals. Manufacturing is the largest economic development driver in the wind industry. It accounts for almost 70% of total project cost. A stronger manufacturing base in Texas could lead to further economic development.
Direct and indirect economic impacts create a ripple effect through the state economy, providing jobs, tax revenue, and land lease payments to communities. 1000 MW of wind energy generates approximately $260 million in economic activity during the construction phase, $35 million in recurring local economic activity, supports 2100 full-time-equivalent jobs and 240 permanent jobs. It generates $7 million in property tax revenues and $5 million in annual income for farmers and ranchers who lease their land for wind industry developers.
The wind industry also creates other economic benefits through the training of workers, exporting goods outside of the state, fostering research and the development of research facilities, and through the development of new technologies and capabilities.
Sources:
http://www.nrel.gov/docs/fy11osti/50400.pdf
http://www.window.state.tx.us/specialrpt/energy/renewable/wind.php
http://stateimpact.npr.org/texas/2014/03/28/texas-wind-power-breaks-another-record/
http://governor.state.tx.us/files/ecodev/renewable_energy.pdf