Summary
Citing infrastructure and capital markets issues T. Boone Pickens, chairman of BP Capital Management is being "less aggressive with the Panhandle project". Planned to generate 4,000 megawatts of electricity, in effect the Pampa Wind Farm Project was designed as the world's largest wind farm.
Analysis
The center piece of the Pickens Plan, the Pampa project was to have cost $12 billion and completed in 2014, providing electricity to power 1.3 million homes, and wean America off of its oil dependence.
However three things have mitigated against the project. First the global economy tanked, and the price of petroleum plummeted. The result has been a decrease in the price of gasoline and diesel. Even though the price per barrel of oil is presently sitting in the range of $60/barrel, it is still low enough to keep American's using more fuel than last year, despite tough economic conditions. The price of natural gas has also plummeted. Natural gas is second only to coal in the production of electricity; cheap electricity means more consumption, and a lessening by the populace of a need to conserve.
Second, the economic fall out from the global melt down, has resulted in tighter credit markets.
Third and most importantly was the lack of routing capability to a distribution system. The condition of our electric grid, combined with difficulties in permitting and construction of infrastructure are possibly the greatest hurdle to the deployment of this type of generation. turbines.
This set back however is not a deal breaker in developing alternative power generation. In 2008 the United States became the leading provider of wind power. Mr. Pickens has 667 wind turbines n order and has said he will find homes for them.
The United States has been trying to reduce it's reliance on fossil fuels since the Carter Administration. The Obama Administration has or is attempting to create stimulus funding to decrease reliance on fossil fuel, reduce emissions and build a Smart Electric Grid. However deployment of the necessary projects and infrastructure will still require 10 or more years to go online.
