American Electric Power Co., the largest U.S. producer of coal-fueled electricity, agreed to buy the output of a Texas wind power farm that’s being developed by a unit of Babcock & Brown Renewable Holdings Inc.
The 20-year agreement is for all of the production and renewable energy credits that will be generated by the 79.5- megawatt Majestic Wind Farm in Carson County, Texas, northeast of Amarillo, according to a statement today by American Electric’s Southwestern Electric Power Co. unit. Production may begin this month. Terms weren’t disclosed.
The agreement advances a 2007 goal set by Columbus, Ohio- based American Electric to buy 1,000 megawatts from wind turbines and other renewable sources of power by 2011. The Majestic Wind farm will be connected to Southwestern Electric’s 473,500 customers by way of high-voltage lines owned by a unit of Minneapolis-based Xcel Energy Inc.
Texas leads U.S. states with 6,297 megawatts of wind-power capacity and 2,470 megawatts under construction, according to the American Wind Energy Association. One megawatt of wind power can supply 300 average U.S. homes, according to the group.
American Electric’s plants can generate 38,000 megawatts, enough for 30.4 million homes, based on data from the Energy Department in Washington.
The Majestic Wind Farm project is comprised of 53 1.5- megawatt SLE turbines manufactured by General Electric Co., American Electric said.
American Electric fell 56 cents, or 1.7 percent, to $31.57 in New York Stock Exchange composite trading.
