Mega Wind Project Set To Get Underway Near Mojave Desert

The Los Angeles Times reported this week that the Alta Wind Energy Center has broken ground. The reason this project is considered mega is how it started and the overall plan. It is considered the largest wind power project in the US today. The project has had multiple ownership changes since 2000, the original planner went bankrupt and it has not been well received by the local community. The developer Terra-Gen Power has since taken over the project and they have begun breaking ground for the 290 turbines over the nine thousand acres along the Tehachapi Pass. They have also secured over a billion in funding, and are set to receive turbines from Vestas-American Wind Technology. The plan is to provide power to six hundred thousand homes to Southern California Edison customers as they are compelled to meet the State goal of supplying thirty three percent of energy from renewable sources by 2020.

The next faze will involve another 300 turbines by 2015 with potential wind blades being nearly a football field long. The entire project will dwarf the existing landscape of turbines along the pass. Most of this area is farm land along Hwy 58 tucked away among the mountains. Also most of the land is being leased for this project providing an income source and allowing future cattle grazing for farmers.

This type of land in the past sold for less than five hundred an acre not long ago. It was considered unusable or only suitable for agricultural use. It demonstrates that long term land investment can be a patient and lucrative endeavor. There is still an abundance of available vacant land in Kern County and Los Angeles County that is prime for industrial uses like Wind Energy Projects. Many wind tests and planning has been completed over the years, which verifies this area as a prime wind energy location. In this case the permitting process took three years and the project had numerous environment hurdles to overcome. In the end the Alta project will begin.

Buy Land and Sell Half of it Immediately for Your Purchase Price, that’s the California Way

The Los Angeles Times recently reported that a renewable energy venture firm won a bid to purchase a potential wind farm site near Bakersfield, California in Kern County. The land site known as Onyx Ranch is in the Tehachapi Mountains and is a prime location for a Wind Farm. The winning bidder was by Renewable Resources Group who outbid the Los Angeles County Department of Water and Power with a bid of $48 million. They then offered to sell it to the DWP for $65 million to use half of the property, but the DWP decline the offer.

The venture partner group then located another suitor in the City of Vernon which has its own electric utility and is also in Los Angeles County. They purchased about half the property for $42 million. Now the DWP is looking to purchase the land from the city of Vernon, or take them to court. The Mayor of Los Angeles Villaraigosa has pledged to make Los Angeles “the greenest big city in America.”, but he will need places like Onyx Ranch and Antelope Valley to shoulder the Counties Wind and Solar needs.

There seems to be “an inside job” surrounding this deal, since the founder of Renewable Resources Group J. Ari Swiller was Mayor Villaraigosa’s campaign manager and the Deputy Mayor David Freeman helped found Renewable Resources. The Los Angeles Times reports that Mr. Swiller indicated that he didn’t know that the DWP was interested in the property. Looks like if the DWP really wants the property then they will have to pay more now then they offered before, and apply eminent domain on the 30,000 acres to prevent other from developing the site. The end result is a higher cost to the consumer.

Renewable Resource Group is a shrewd investor who bought land that is essentially unusable until the State imposed the mandate last November for 33% of all energy to be from renewable resources. It also shows there are still opportunities in land investment in a slow real estate market. The right type of land that aligns with future specific plans can land an investor in the green.