Wind on the Water: Q&A with Jerry Patterson, Texas State Land Commissioner

While most of the discussion about offshore wind energy projects involves those on the East Coast of the United States, such as Cape Wind in Massachusetts, Texas is moving forward with wind projects within its sphere of influence.

Offshore development efforts in Texas include those by Baryonyx, formed by former senior managers of Eclipse Energy, which successfully developed several offshore wind projects in Europe. Baryonyx currently holds three leases for parcels in the Gulf of Mexico, is negotiating the permitting process and, its senior vice president of offshore development told TransmissionHub, hopes to have a project built and producing energy by 2016.

In Texas, the General Land Office (GLO) oversees the use of all state lands, including 2.5 million acres of land that are underwater in the Gulf of Mexico.

Thanks to litigation in the 1940s and 1950s, known as the Tidelands Controversy, Texas retains ownership and control over submerged lands up to three leagues, or nine nautical miles, from shore, while the jurisdiction of most states ends at three nautical miles.

That fact gives the GLO a major role in the development of offshore wind facilities.

TransmissionHub spoke with Texas State Land Commissioner Jerry Patterson, who is in charge of the Texas General Land Office, which oversees the use of state lands.

TransmissionHub: How does your state’s unique situation lend itself to the development of offshore wind?

Patterson: The permitting process is a lot simpler here than it is elsewhere. Texas, being sovereign, has control up to three leagues, or nine nautical miles, into the Gulf of Mexico. You’ve got your Corps of Engineers permit and you’ve got to tag up with the Coast Guard, but as long as you’re within that three-league boundary, it’s simpler.

In addition, Texas already has a working coastline. We’ve been looking at oil rigs offshore for quite some time, and these wind farms when they’re located, frankly, will not be that visible from the coast. Even so, we don’t care. It’s energy, it’s progress, it’s clean, and it makes money – in our case, for the school children – so we like that.

THub: So your primary motivation is not the lack of environmental impact, but money?

Patterson: Clean energy is a nice bonus, but our primary concern is revenue and, in Texas, all the revenues from state lands are dedicated to public or higher education, so we have an educational motive and a moneymaking motive.

We’ve been in the energy business for a very a long time – a hundred years or more – and this is energy. And many of the skill sets used to build offshore wind platforms are the same skill sets to install exploration and production facilities in the Gulf of Mexico, so it’s just a natural extension. It’s energy, we like energy, we like producing energy, and we like making money doing it.

THub: Based on your state’s history and your aggressive development of energy sources from a number of sources – oil, gas, and now wind — it appears that Texas is positioning itself to become the first state in the nation to actually generate wind off its shores.

Patterson: We don’t have any production yet. We hope that’s not too far down the road. As you know, we were the first offshore lease in the United States and we have several of them now. And hopefully in the not-too-distant future, they’ll be producing electricity.

THub: What lessons are you learning from on-shore wind development?

Patterson: One of the interesting lessons is that wind has become a significant factor in meeting our load here in Texas. Of the Electric Reliability Council of Texas (ERCOT) generation in the last year that we have data for, 8% was wind power. And when we build out the CREZ (competitive renewable energy zone) transmission lines, that’ll probably be up around 12 to 15%.

So we’re going to be using wind power – particularly coastal wind – quite a bit. The great thing about the coastal wind is that it’s peak wind. It’s afternoon wind. It’s 5 o’clock-in-the- afternoon-on-a-110-degree-day wind. That’s what great about it.

During the last summer, when we had more than 100 days of over 100 degree temperatures, we had some days that, were it not for the wind power on coastal land-based wind farms, we’d have had rolling blackouts.

And Texas is growing. We’re getting very close to reaching a point where we have to worry about having sufficient supply to satisfy all the electric demands, whether it’s industrial, residential, whatever, and wind is an important source of where future generation will come from. So, wind is real important in Texas, and we want more of it.

THub: With ERCOT not connected to the Eastern or Western Interconnection, what other options do you have for adding generation?

Patterson: Well, we grow our own, and we’ve got some other interesting things going on. We have a crosstie connection with Mexico, but we do have a self-contained grid that gives us a great deal of flexibility and, we think, reliability. That’s going to be even more significant when the CREZ transmission build-out is complete, and that’s moving rather quickly.

I drove through a large wind farm recently and the wind was whipping pretty fast, but I looked at those vast wind turbines and saw a substantial number of them were feathered. The reason for that is congestion. We don’t have the transmission to be sending that electricity to the load centers. When that transmission is complete, I hope to see very few feathered wind turbines and even greater wind power delivered to customers here in Texas.

THub: Geographically, Texas is the largest state in the Lower 48. How does that vast geography help integrate large amounts of wind?

Patterson: When you’re a state as large as Texas, the wind is going to be blowing somewhere. One of the shortcomings folks frequently mention when talking about wind is that, when the wind’s not blowing, you’re not generating any wind power. But in Texas, the wind’s blowing somewhere on any given day. With wind farms disbursed in the panhandle, a little farther south in the Permian Basin (in west Texas), and with the coastal wind, I’m pretty sure we’re going to have wind power somewhere that’s going to be filling the demand.

THub: When Baryonyx gets its offshore wind project up and running in 2016, where will that power be used?

Patterson: A good thing about coastal wind is that, when you build it eight miles out in the Gulf of Mexico, you’ve got to lay eight miles of cable and then you’re connected to the grid. You don’t have to build 300 miles of transmission line, so it’s ready to go into the high load centers of Houston, Corpus Christi and even further inland – San Antonio, Austin – and it’s great. It’s perfect wind. It’s the right time of day.

THub: Much of the rest of the country struggles with wind that blows off-peak. Is that a battle you also fight in Texas?

Patterson: There’s a way you can use off-peak wind. You can do things with it that produce something that you can store. For example, there’s a discussion about using wind power to power reverse-osmosis desalinization plants. That’s a commodity you can make, and it doesn’t make any difference whether you make it at 2 a.m. or 2 p.m.; it’s there, and it negates some of the time factors of wind.

There’s also some interesting research being done on battery technology. Everybody’s waiting for the “big ol’ battery” – acronym BOB – and when we get the storage technology, that’s going to make wind even more viable.

THub: We’ve discussed variability and off-peak generation; any other downsides to wind you’ve identified and are dealing with?

Patterson: Renewables have to be economic. There are those who complain about the production tax credits and other types of tax credits, but what I tell those folks is that every energy sector has had some sort of incentive at some time, if not all the time. Whether it was oil depletion allowance, or royalty relief, or severance tax credit in the hydrocarbon industry, or the nuclear energy, they’ve all had some kind of subsidy. So, to those who are the ideological economic purists and say we shouldn’t subsidize wind, I say let’s not subsidize any energy sector. If you want to hold that out, let’s go all the way.

 

Leading thought leaders will be discussing this topic and more at TransForum Texas taking place in San Antonio, April 24-26th. This regional event is designed for executives in electric transmission to network, discuss the successes and failures of projects with colleagues, challenge speakers with new ideas and drive our industry forward. Review full conference details here.