Comprehensive Representation In The Field Of Energy Law

A wind farm could be a stable income producer for landowners

On Behalf of | Apr 26, 2021 | Wind Energy |

Texas is well on its way to being the “Energy State,” with multiple sources of energy actively being harvested in addition to traditional oil and gas. One of the fastest growing types of renewable energy is wind power, and Texas is well-positioned to capture it.

Does Texas experience enough wind to make a wind energy farm realistic? It certainly does. According to a spokesperson for Engie, a French energy giant, the turbines in San Angelo, southwest of Dallas, are turning 50% of the time. That’s a good performance for a wind farm in the U.S.

Indeed, Texas is currently the nation’s top producer of wind energy and the second-largest producer of solar energy. Oil and gas has been increasingly coexisting with renewable energy sources in our state, and the availability of stable revenue has persuaded some rangers to swap out.

TechXplore recently profiled cattle rancher Bobby Helmers of San Angelo. At 79, he has a lot of experience monetizing his ranch in various ways. For years, he leased parts of his ranch to oil wells while running 125 head of Brangus cattle.

Several years ago, Helmers and his wife, a third-generation owner of the ranch, decided to plug up their oil pumps and install wind turbines.

Now, those turbines account for half of the ranch’s operating revenue.

Wind power can be a more stable revenue source than oil and gas

Helmers didn’t choose wind energy over oil because he’s an environmentalist. He was looking for a solution to the fact that his oil pump revenues were dropping off. In the 1990s, those pumps were producing steadily shrinking returns and the operator decided to close them down.

The Infinity Renewables group met with Helmers and some of his neighbors at a local restaurant, where they described the potential royalties from just a few turbines. Helmers was convinced – and things turned out even better than expected.

It did take a full decade to get from initial negotiations to actual construction, but then Engie bought Infinity Renewables and provided improved technology.

“The turbines were supposed to be 1.5 Megawatt hours, and they are now 2.625,” Helmers says.

On top of that, wind profits are steadier than oil and gas income. Oil and gas royalties fluctuate due to market volatility, whereas wind energy is more stable. And, under many contracts, the profit shares rise over the years through amortization.

Helmers does note that his turbines stopped turning for 10 whole days during the paralyzing winter cold snap in February. Technology improvements and winterizing techniques might be able to prevent that from happening in the future.

A wind farm on your property could provide a steady new income stream. If you’re ready to sign up, don’t sign a contract without first talking to a lawyer who has negotiated and reviewed multiple contracts with wind industry players.

Archives