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On May 9, Otter Tail Power Company entered into a 25-year contract to purchase wind energy from the Ashtabula III wind farm northeast of Valley City, N.D. Wind energy now will supply about 19 percent of the Fergus Falls-based Otter Tail Power Company’s retail sales. Marie Nitke/FOCUS

Otter Tail Power Company signs 25-year wind energy contract

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Otter Tail Power Company has entered into a 25-year contract to purchase wind energy from the Ashtabula III wind farm near Valley City, N.D., it was announced last Thursday.

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The 62.4-megawatt Ashtabula wind farm is owned by a subsidiary of NextEra Energy Resources. The contract includes an option for Otter Tail Power to own the wind farm in 10 years.

According to Harvey McMahon, Otter Tail Power’s manager of renewable energy construction and operations, this energy purchase was below the cost modeled in the company’s biennial resource plan. In addition, the purchase positions the company to meet its renewable energy obligations in the three states it serves through 2025.

Wind energy now will supply about 19 percent of Otter Tail Power Company’s retail sales.

“This is positive for our customers,” said McMahon. “This offer was low cost when compared with other resources, including other risk-adjusted wind proposals. The bill impact will be negligible, usually zero and sometimes less, because this low-cost wind purchase will replace other energy purchases that otherwise would be required to serve customers, particularly over the long term.”

Ashtabula III consists of 39 1.6-megawatt GE XLE turbines and is capable of producing enough electricity for 19,000 homes. The wind farm began commercial operation in 2010. A subsidiary of NextEra Energy Resources operates Ashtabula III and will continue to do so.

“Purchasing energy from an existing wind farm eliminates the permitting risk and construction risk associated with building a new farm, including the risk that Congress won’t continue to extend the production tax credit,” McMahon said. “Additionally, Ashtabula III’s proximity to two wind farms we own and our familiarity with NextEra, which operates and maintains those wind farms on our behalf, makes purchasing energy from Ashtabula III a good fit for us.”

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