The Columbus, Neb.-based utility signed a 20-year agreement to purchase power from Midwest Wind Energy LLC of Chicago and its affiliate, Elkhorn Ridge Wind LLC, which would generate 80 megawatts of electricity, enough to power about 25,000 Nebraska homes a year.
Financial terms of the agreement are confidential, NPPD said, but the pricing "compares favorably" with the cost of NPPD's owning and operating such a project or purchasing electricity on the open market.
The agreement makes Midwest Energy the first independent power producer to negotiate a purchase contract with NPPD. Midwest Energy said the project would cost $140 million to build and pay more than $5.7 million in property taxes to local governments over five years, plus $325,000 a year in lease payments to landowners.
Midwest said about $21 million of the project cost would be spent in Nebraska for material and services to construct the plant, creating more than 100 full-time jobs during the nine-month construction period and six permanent operating jobs.
NPPD said a groundbreaking would take place soon.
NPPD is negotiating with a second developer for a 40-megawatt wind-powered plant near the same location and with a third developer at an undisclosed location.
NPPD operates a wind farm near Ainsworth, Neb., that can generate 60 megawatts of electricity. By contrast, NPPD's Gerald Gentleman Station coal plant near Sutherland, Neb., has a capacity of 1,300 megawatts.
NPPD recently dismantled its wind farm near Springview and plans to replace those turbines.
In July of last year, NPPD invited proposals for wind projects up to 100 megawatts, receiving 10 proposals from seven developers and narrowing that list to three. Elkhorn Ridge is the first to reach a purchase agreement.