MidAmerican Energy Co. announced locations for two new Iowa wind farms a day after accepting modifications to a rate making settlement as part of a $900 million plan to increase wind generation capacity.
The turbines will be installed in Ida and O’Brien counties in western Iowa, adding 552 megawatts of wind capacity to the company’s portfolio by the end of 2016.
For MidAmerican’s electric customers across the state, the project is cost neutral for rates, company spokeswoman Ruth Comer said. The advantage is wind should stabilize rates for years to come by reducing reliance on fossil fuels, she said,
“For our customers, we found wind has benefits,” Comer said. “Wind allows us to keep our rates stable and affordable over time.”
The plan includes approximately 134 wind turbine at a new Ida Grove wind farm, and approximately 104 turbines at an O’Brien wind farm, according to the company, bringing the companies total to more than 2,000 turbines in 23 counties since 2004.
The additional megawatts represents an increase of 15 percent from the 3500 MW of existing capacity, Comer said.
The company is on track for wind to outpace coal as its top energy source by the end of 2015. Energy will come 42 percent from wind, 36 percent from coal, 16 percent from natural gas, and 6 percent from nuclear and other sources, Comer said.
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The wind farm announcement comes after the company agreed to modifications by the Iowa Utilities Board to a rate making settlement between MidAmerican and the Iowa Office of Consumer Advocate.
Among the modifications, return on equity as part of electric rates will be 11.35 percent, down from 11.5 percent, and the cost cap for the project is $1.61 million per megawatt, down from $1.638 million to reduce the risk of price increases for customers.
At a July hearing, a MidAmerican executive testified the company doesn’t foresee a need for a rate increase in the next 10 years.
This case comes months after another MidAmerican wind project, in which the Utilities Board ordered MidAmerican to repay $2 million a year in credits to
electric customers, saying the rate making principles skewed too much in favor of the energy company over customers.