Fuel prices thwart Pickens' wind farm
Earlier this year, T. Boone Pickens announced a grand plan to build the world's biggest wind farm and help wean the country off gasoline. Now that natural gas prices have tanked, he's putting the plan on hold. Sam Eaton reports.
T. Boone Pickens, Chairman and CEO of BP Capital (Spencer Platt/Getty Images)
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TEXT OF STORY
KAI RYSSDAL: T. Boone Pickens said today he's putting plans to build the world's largest wind farm on hold. Pickens made his billions in oil, of course. But it's natural gas prices that're putting the kibosh on his wind farm. Pickens has been advertising his "Pickens Plan" like crazy. He wants to use wind and natural gas to get this country off foreign oil. Of course, oil closing at $55.77 today and gas off another 5 percent kind of throws a wrench into the economics of renewable energy.
But as Marketplace's Sam Eaton reports from the Sustainability desk, there may be a silver -- or a green, anyway -- lining.
SAM EATON: T. Boone Pickens' announcement to delay construction of a $10 billion Texas wind farm leaves a gaping hole in efforts to boost the nation's renewable energy portfolio. The oil tycoon says cheaper natural gas, also used to generate electricity, has taken some of the wind out of wind power. But Berkeley energy expert Dan Kammen says there's an even bigger problem -- finding the cash.
DAN KAMMEN: It's much more a question of the short-term capital available to initiate a project that is building several-hundred-foot-tall structures. Big infrastructure is needed.
And big bucks. Something that's hard to come by these days. Pickens own investment firm lost as much as $2 billion this year as stocks plummeted. Ethan Zindler of the clean energy research firm, New Energy Finance, says Pickens isn't alone. Major wind backer, GE, says it's "facing constraints."
ETHAN ZINDLER: I would say in the short run this is not good news for the industry.
But Zindler says the long run may be a different story.
ZINDLER: Because the traditional players -- a lot of them have either pulled in their horns or left the playing field entirely -- there's an opportunity for new players to come in and potentially earn higher returns because the industry very much needs that capital and needs it now.
And when it comes to capital, Zindler says one industry's still flush: Big Oil.
Throw Congress's new renewable energy tax credits into the mix and it's an opportunity oil giant BP has already found too good to pass up. Last week, the company announced it would shift the bulk of its $8 billion renewable energy spending program to projects in the U.S.
In Los Angeles, I'm Sam Eaton for Marketplace.
Comments
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From oak harbor, WA, 11/18/2008
And I thought you had a change of heart for once! To help the American People and not your pocket book! You could have changed the way this country thinks and put us on the right track to green powered
Energy. Very disappointed
From Scottsale, AZ, 11/13/2008
"Pickens has been advertising his "Pickens Plan" like crazy. "
I will now call you Valley Girl Kai.
Oh no! A real American traitor backs out on his word and lost $2 Billion. *sob* *sob*
Actually it's more:
*Clap* *Clap* *Point* *Point* *Laugh* *Laugh*
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