Southern Company, Georgia Tech Wind Power Study Finds Potentially Favorable Conditions for Offshore Generation Pending Resolution of Economic, Regulatory Issues

Southern Company, Georgia Tech Wind Power Study Finds Potentially Favorable Conditions for Offshore Generation Pending Resolution of Economic, Regulatory Issues
ATLANTA – Southern Company said today that a thorough two-year study conducted with the Georgia Institute of Technology has identified several conditions potentially favorable for wind power generation off the coast of Georgia, but that high costs and regulatory issues still need to be resolved.

Launched in 2005, the joint study examined in detail a variety of factors – including wind resources, technology, siting, environmental, weather conditions, permitting and economics – associated with sites off Georgia’s coast. In conclusion, the study recommended that Southern Company continue to pursue the potential development of wind energy resources in the state’s coastal waters.

“We continue to believe that renewable energy resources, including wind, need to be a part of our energy supply portfolio. We will continue to pursue this and other renewable energy options that allow us to provide reliable and affordable electricity to our customers,” said Leonard Haynes, Southern Company executive vice president for supply technologies, renewables and demand-side planning.

“We believe that given the available wind resources and the extent of the shallow water continental shelf there is considerable ultimate potential for wind power generation off the coast of Georgia. While the 20 year levelized cost of wind power is higher than current production from existing power plants, off shore wind power may become a viable option for green power generation. We therefore, support the conclusion that development of offshore wind power should be pursued.” said Sam Shelton, Strategic Energy Institute research program director.

Currently, the Department of Interior Minerals Management Service (MMS) has jurisdiction over alternative energy-related projects on the outer continental shelf, including wind power developments. MMS is currently outlining the permitting requirements for such projects, a process that should be completed in late 2008. Until these regulations are finalized, only limited activities to develop an offshore wind farm in federal waters may be conducted.

Though the Southeast in general does not have sufficient wind speeds to effectively support wind power generation, the conditions are better starting about five miles off the Georgia coast, the study said. The average wind speeds there are about 16-17 mph. Wind technologies currently available typically require sustained winds of 14 mph or greater.

Among other key findings, the water in the area is relatively shallow, which could make it easier to establish the foundations of a wind farm. Also, the study said, existing electrical substations on Jekyll Island and Tybee Island are the two locations with the best potential for connecting power from an offshore wind farm to the transmission grid.

Of the two locations determined to be feasible for development, the study noted that Tybee Island was better suited because the turbines would be less visible from the beach, the wind resource is slightly better and it is closer to industrial and maintenance resources.

However, the study found that based on today’s prices for wind turbines, the 20-year levelized cost of electricity produced from an offshore wind farm would be significantly higher than the current production costs from existing power generation facilities.

Among the reasons for the high costs are the additional case-hardened cabling that would be required to locate the stations far enough offshore to minimize the view from land and take advantage of the greater wind speeds. Another significant issue is the additional cost of construction and maintenance of a facility in the ocean. While specific installation and maintenance infrastructure is in place in Europe, the offshore wind industry is in its infancy in the United States.

“Provided regulatory and technological hurdles can be overcome and the communities we serve favor this approach, we will continue to explore developing both off- and on-shore wind energy for our customers,” said Haynes.

Southern Company is currently involved in a variety of renewable energy projects, including extensive research into the use of biomass, which has yielded promising results for the use of materials such as switchgrass and wood chips to produce energy. Through its subsidiaries, Southern Company also offers customers the opportunity to purchase “green” energy from renewable sources such as a generating plant in DeKalb County, Ga., that provides electricity produced from landfill gas to Georgia Power.

The Georgia Institute of Technology is one of the nation’s premier research universities. Ranked eighth among U.S. News & World Report’s top public universities, Georgia Tech’s 17,000 students are enrolled in its Colleges of Architecture, Computing, Engineering, Liberal Arts, Management and Sciences. Tech is among the nation’s top producers of women and African-American engineers. The Institute offers research opportunities to both undergraduate and graduate students and is home to more than 100 interdisciplinary units plus the Georgia Tech Research Institute.

Georgia Tech’s Strategic Energy Institute (SEI) serves as a conduit for integrating, facilitating, and enabling Institute-wide programs in energy research and development. Engaging the best and brightest from industry, government, and academia, SEI creates innovative solutions to current and future energy challenges.

With 4.3 million customers and more than 42,000 megawatts of generating capacity, Atlanta-based Southern Company (NYSE: SO) is the premier energy company serving the Southeast, one of America’s fastest-growing regions. A leading U.S. producer of electricity, Southern Company owns electric utilities in four states and a growing competitive generation company, as well as fiber optics and wireless communications. Southern Company brands are known for excellent customer service, high reliability and retail electric prices that are significantly below the national average. Southern Company has been listed the top ranking U.S. electric service provider in customer satisfaction for seven consecutive years by the American Customer Satisfaction Index (ACSI). Visit our Web site at www.southerncompany.com.