T. Boone Pickens may stall wind farm plans

Billionaire oilman T. Boone Pickens, who launched a high-profile campaign to reduce oil imports to the U.S., is being forced to delay a huge planned wind-farm project, according to published reports.

Over the past two days, Boone spoke at events where he said that the wind project is having trouble getting financing because of the credit crunch.

Investor T. Boone Pickens

(Credit: Pickens Plan)

He was also quoted saying that falling prices of natural gas, used in power plants, are making his wind project less economical.

Boone in July launched a public campaign, said to be funded with $57 million of Boone's money, to wean the U.S. off oil imports through a massive investment in wind energy and conversion to natural gas for vehicles.

Earlier this year, he also founded Mesa Power to oversee what would be the world's largest wind farm in Texas, able to make 4,000 megawatts of electricity, or enough to power 1.3 million homes.

Speaking at a Forbes Energy Conference on Wednesday, Boone said he has had to delay financing the project. But he characterized it as a temporary setback.

"When we were looking at the project, we felt like we could do it with 30 percent equity and 70 percent debt," The New York Times quoted Pickens saying on Wednesday. "The 70 percent debt is where we're having a little slowdown."

Mesa Power has already placed orders for the first phase of the Pampa Wind Project, 667 wind turbines from General Electric capable of generating 1,000 megawatts of electricity, enough to power more than 300,000 average U.S. households.

"The capital markets are problematic for everyone and...may lead us to scale back a bit," Jay Rosser, a spokesman for Mesa, told CNN in a statement. "But we are still going forward with our wind business."

The first phase of the project, projected to cost $2 billion, was supposed to come online in early 2011.

[Galaxy5]

If he's so gung-ho about it, let him use his billions to finance the project. He and his helped this country get used to plentiful, cheap oil - maybe he is such a patriot as to invest in helping wean us away from that energy dead-end.

[texaslabrat]

He is using his own money to finance a very large chunk of it. Getting debt financing is critical to moving forward quickly, as even T. Boone Pickens doesn't have the cash on hand to finance the whole project out-of-pocket. He could move incrementally...waiting for revenue to be produced from phase I in order to fund phase II, etc..but that could take decades to complete in that fashion. And ultimately...the debt has to be paid back..it's being underwritten by Pickens' corporate credit rating..so in that way he is effectively "using his billions to finance the project".

[robgart]

whats the point now that gas is cheap again.

[texaslabrat]

LOL that's exactly the short-sightedness that got us into the economic mess we find ourselves in. Everything's always one quarter at a time to folks like you. Well, let me clue you in on something: gas is cheap NOW because the economy sucks NOW. When the economy recovers, gas will go back up. The overall fundamentals of global supply and demand haven't changed...we are just in a dip due to the global economic downturn which (hopefully) won't last forever. It would be nice if there were some renewables in place that caused gas to not go up AS MUCH when the economy (and thus global demand) recovers, wouldn't it? Now is the perfect time to implement renewable energy plans as the construction costs are lower during an economic downturn. The problem at the moment, as mentioned in the article, is that financing is more difficult to come by...which causes some of its own issues in getting things done.

[MSSlayer]

To add to texaslabrat's outstanding comments. Gas is a finite supply. Which means it is not a long term solution.

Your shortsightedness is amazingly idiotic.

[SnowCrash8]

>whats the point now that gas is cheap again.

That's right, time to run out and buy more 4 mpg 12 cylinder SUV 'land yacht's; ditch the CFL bulbs; while lower gas prices persist for the next year. But, of course when consumption again ramps up (and it will), we are back to square one, and have lost time.

Robgart, does not it bother you that America is energy dependent on foreign sources, and that pricing is no longer stable? This can and must be changed, and people like you need to try and understand why this need exists and think longer term.

[meh130]

"667 wind turbines from General Electric capable of generating 1,000 megawatts of electricity"

Realize that 1,000 watts is the maximum generation, and wind is an intermittent power source. Wind is not base-load power. Realistically, a wind farm will generate about one-half of its rated max capability. To keep power supply consistent, wind has to be deployed in conjunction with a gas-fired, coal-fired, or hydroelectric facility capable of generating a similar max power to provide power when the wind is calm.

One Westinghouse AP1000 Generation III+ passively safe nuclear reactor generates 1,100 megawatts of base-load electricity.

[willdryden]

There is also a limited supply of fuel for a nuke too. We just have not gotten to the point where it is getting expensive yet. We went over 50 years with gas under 50 cents per gallon. It took 30 years to get to $4.00 per gallon and in some places over $5.00 per gallon. The only true answer is renewables. That means solar (both PV and thermal), wind, and tidal. Tidal is base load and so can solar thermal if the heat is stored properly. The wind blows all the time SOMEWHERE. You just have to over build the wind generators in different locations to make it useful as base load.

I think you have your facts exactly right. I do wonder why T. Boone is not using the larger Vestas mills. He could get by with half the number of them.

[ledhead1962]

What the world needs is a coalition of the super rich to do this type of thing across the planet. Mr. Pickens deserves a medal for his efforts. I know that his motivation is not 100% altruistic but I for one will not begrudge an enlightened capitalist his profits when the public has so much to gain and so little to lose. We should all say a prayer that this project does not get hung up by the economic climate because it's success will open up future projects. This is the very thing I hope Obama is talking about when he speaks about the new age of energy. PLEASE, NO MORE DITHERING LETS GET GOING!!!

[realist56]

you want a coalition of the 'super rich' to take care of things for you? what about the country doing it as well? where does the ownership as a unit come in? everybody's *******' and moanin' because exxon/mobil's crankin' out the bucks every quarter, what are you going to be calling T.Boone when he's the one going to the bank 2x a day?