CleanBeta

T. Boone Gets Blown Out of the Water

T. Boone Pickens has delayed work on a state permit to build 170 miles of transmission lines carrying enough wind energy to power 300,000 homes, raising concerns that the much heralded Pickens plan may not pan out as planned.

Earlier this year, Pickens ordered nearly 670 turbines for the project and planned to eventually quadruple that power production. But the credit crisis has strained Pickens’ hedge fund, BP Capital, which has lost $1 billion so far this year. Jay Rosser, a BP Capital spokesman, said recently that work continued on the wind farm but that struggling capital market could delay or reduce those efforts. The capital markets may force BP Capital to scale back a bit but we are still going forward with our wind business.

Other companies with active wind construction projects in the state reported that they remained on schedule. Firms completed more than 690 megawatts of new wind capacity in Texas as of September and had another 2,500 megawatts under construction, according to the latest figures from the American Wind Energy Association. Texas’ largest transmission project, too, had not stumbled during the downturn.

But market conditions and the sheer scale of the effort could have helped stall the Pickens project. In addition to battering the hedge fund, the continuing financial crisis had tightened lending and lowered expectations for fuel demand. Natural gas, a major electrical fuel in Texas, has fallen with gasoline and dulled wind power’s competitive edge. Smaller projects were easier to move forward in the current market, said Walt Hornaday, president of Texas Wind Power in Austin. The projects still under way in Texas topped out at 283 megawatts, far less than the 1,000 megawatts Pickens intended to deliver.