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Mar 30, 2017
2:22:47pm
Solomon Levi All-American
I would be curious to know more about your family member
1. what, exactly, his role was in the project that he managed,
2. when, exactly, the project that he built was actually built.
3. I would also be curious who he worked for and if I know him

Your statement "They get built because of free federal money handed out to states and other domiciles" was accurate during the early years of the Obama administration with DOE loan guarantees, ITC, 1603 Grants, and PTC stemming from the ARRA. In other words, what you are said was more accurate as recently as 5 years ago, but much has changed. Costs of wind turbines have decreased, the technology has increased throughout the entire turbine, and greater economies of scale have seen additional savings.

Wind is complicated, location is much more important on a wind farm than it is on a solar farm for instance because of micro-climates and wind patterns. In addition to the micro climate issue, location matters because of interconnection, in other words, how much variable energy is going into the grid closest to the project and what kinds of upgrades must the wind farm developer/owner pay to upgrade the grid in order to take the power produced, coupled with wheeling fees and other interconnection costs as needed.

Another factor is the prices for which the power will be sold to the off-taker in the transaction. Some areas that have had excellent wind resources have resulted in a market flooded with wind, and so the supply is higher than the demand, and the PPA price for new projects has dropped significantly.

Everybody needs to understand that ALL forms of power generation take tax credits and/or some subsidy. Wind tax credits are set to sunset entirely in 2019. Currently the production tax credit is around .015/kWh and only applies to the first 10 years of the project.

All of this considered, I have seen recently closed projects that based on the detailed on site met data, avoided cost ppa, capex, land cost, O&M etc etc etc, that will be built after the sunset of the tax credits will still achieve an unlevered after tax IRR north of 10-13%.

That is a good investment by any measurement.
This message has been modified
Originally posted on Mar 30, 2017 at 2:22:47pm
Message modified by Solomon Levi on Mar 30, 2017 at 2:51:14pm
Solomon Levi
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UtePimp
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Solomon Levi
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