Pattern Energy will break ground this fall on a 1,000-megawatt complex of wind farms in central eastern New Mexico, as well as a new 150-mile transmission line to carry those electrons to Western markets.
Pattern’s Western Spirit Wind Development project represents about a $1.5 billion investment that will generate some 1,000 construction jobs over the next year and more than 150 permanent jobs, according to the company.
And that’s just the tip of the iceberg in Pattern’s plans for the state. It expects to build a total of 4,000 MW of wind generation here in the coming years, representing an $8 billion investment, said Sarah Webster, Pattern’s vice president for investor and government relations.
“We are just at the beginning in New Mexico,” Webster told participants in a webinar Wednesday afternoon. “…We are working closely with local communities to create jobs and bring positive economic impacts, including long-term community benefits.”
The webinar, hosted by the State Land Office, brought together industry representatives and government officials, including Democratic U.S. Sen. Martin Heinrich, to discuss a surge in wind development underway in New Mexico, along with the state’s potential to become one of the largest suppliers of wind and other clean energy throughout the West.
“We’re at the tipping point. It’s taking off,” Heinrich told participants. “… There are lots of challenges ahead, but it’s in our control and ability to lean in to make a difference and out-compete others to become a leading state for exporting electricity and importing dollars and jobs.”
New Mexico’s gusty eastern plains offer some of the best wind-generating potential in the U.S., attracting broad interest from energy developers for more than a decade.
That’s already led to construction of about 20 wind farms that collectively produce nearly 2,000 MW of electricity, or enough energy to power nearly 630,000 homes, according to the American Wind Energy Association’s latest annual report on wind development in the U.S., released in April.
And with state government now aggressively pushing clean energy development, new project proposals are flooding into the State Land Office for approval to build more renewable generation on state trust land, Land Commissioner Stephanie Garcia Richard said. About 40 applications for new solar and wind projects are being processed.
New Mexico wind generation and development supports nearly 2,000 local jobs and provides about $20 million a year in land lease payments, and in state and local revenue, according to the Wind Energy Association.
More than 2,000 MW of additional wind development is in the pipeline for New Mexico, said John Hensley, the association’s vice president for research and analytics.
“As advancements with wind power continue to accumulate across the country, New Mexico stands to benefit substantially as current projects under construction or in advanced development will nearly double the state’s installed wind capacity,” Hensley told webinar participants.
Just since last summer, the Land Office has approved leases for four new wind farms that together will produce about 400 MW of electricity, generating about $80 million in revenue for the state over the life of those projects, Garcia Richard said.
That includes the 140-MW La Joya II wind farm just west of Encino in Torrance County, which will supply electricity to Public Service Company of New Mexico. Avangrid Renewables broke ground on that project in May, alongside the 166 MW La Joya I wind farm, which PNM will use to channel electricity to Facebook’s massive data center in Los Lunas.
The newest land leases, signed June 1, went to Pattern Energy to permit development on about 16,400 acres of state trust land as part of its 1,000-MW Western Spirit project. The leases will generate about $16 million for the state over the life of the project. And since most Western Spirit wind farms will be built on private property, millions more will flow to local landowners.
Pattern is by far the largest wind developer in New Mexico. It already operates 550 MW of wind farms near Clovis that now supply renewable electricity to utilities in California and other Western states. The company invested $1.6 billion in those projects, creating about 700 construction jobs and 30 permanent jobs, Webster said.
Pattern is also the anchor tenant for the SunZia Southwest Transmission Project, a 520-mile high-voltage line that would run from central New Mexico near Corona in Lincoln County to Arizona. Pattern could build up to 3,000 MW of wind farms around the Corona area to transport over SunZia once it is built.
Unlike the Western Spirit transmission line, however, which has all federal, state and local permits in place, SunZia must still win state and federal approval to move forward. Opposition from landowners, wildlife conservation groups, and local politicians – who object to SunZia’s potential impact on rural landscapes and migratory birds along the Rio Grande – could still derail the project.
That’s one of the few big challenges that wind development is still facing in New Mexico. More wind generation is contingent on increased transmission capacity. More outreach to communities is needed, said Fernando Martinez, executive director of the state Renewable Energy Transmission Authority.
“Convincing people that investment in transmission infrastructure is as important as investment in a school or hospital is critical for the economy,” Martinez said. “It’s essential to develop a reliable, connected grid for renewable energy.”
And given the boom-and-bust cycles that plague the oil and gas industry, it’s critical to develop New Mexico’s renewable resources to offset state dependence on income from fossil fuels, Garcia Richard said.
“The recent unprecedented challenges facing our state have only strengthened our determination at the Land Office to execute build-out of New Mexico’s incredible potential for wind energy on the hundreds of thousands of acres of state trust land that are prime for these projects,” Garcia Richard said. “Not only will increased wind power boost our economy for decades while raising valuable revenue for our public schools, it will lessen New Mexico’s dependence on fossil fuels and take on the role of being an important economic vehicle in the recovery fight against COVID-19.”
Source: “NM Wind Energy Development Surges Forward“
Archives for June 2020
Industrial Real Estate Leads the Way Out of the COVID Crisis
The industrial real estate sector showed significant gains in new redevelopment/redevelopment, building acquisitions and deal activity.
Construction Costs Expected to Ease for Apartment Developers
Developers aren’t exactly finding bargains at the moment, since there’s now also downward pressure on rents and potential returns. The net result is that even as more companies re-open for business most multifamily developers are still hesitating to start big projects or sign big deals to purchase materials. Those big deals that could help establish a new normal for construction prices are largely in a holding pattern, especially now with worrying signs of new spikes in COVID-19 case counts and rising hospitalization levels in many states.
“Generally pre-COVID pricing is still prevalent,” says Paula Cino, vice president of construction, development and land use policy for the National Multifamily Housing Council (NHMC). “There is a lot of uncertainty.”
On balance, a minority of developers (17 percent) say that prices are rising for materials they need to build apartments, according to an NMHC survey. Prices plunged at the onset of widespread COVID-19 cases in the U.S. and government-imposed measures to contain the spread. Since then, prices have rebounded. The producer price index for inputs to new multifamily construction increased 0.6 percent in May 2020, compared to April (not seasonally adjusted), though the index was still down 1.8 percent compared to the year before, according to an analysis of Bureau of Labor Statistics data by the Associated General Contractors of America (AGC), based in Arlington, Va.
Despite those numbers, most experts expect materials costs to dip over the next year, as it gradually becomes clear how quickly many of the more than 45 millions of jobs lost in recent months come back and how many renters will be able to pay market rents at new apartment developments.
“Contractors will find less and less work in the next year as current projects finish up and owners face financial difficulties and reduced or uncertain demand,” says Kenneth D. Simonson, chief economist for AGC. “Overall project costs for developers are likely to be down, or at least to increase much less than appeared likely at the beginning of the year.”
However, not all contractors are so pessimistic. “Currently our backlog is greater than it was at this time last year so the outlook for the future appears positive,” says Marc Padgett, president of Summit Contracting Group, based in Jacksonville, Fla.
In addition to domestic issues, disruptions to international supply chains are expected to put upward pressure on materials prices through the summer, says David Logan, director of tax and trade analysis at the National Association of Home Builders.
On the flip side, shortages in supply for some materials caused by the pandemic have caused some prices to rise.
“The lumber market dropped for a couple of weeks right at the beginning of the pandemic but that was quickly offset by price increases,” says Padgett.
The producer price index for lumber and plywood rose 1.4 percent in May 2020, compared to April (not seasonally adjusted), though the index was down 1.6 percent compared to the year before, according to the Bureau of Labor Statistics.
The cost of lumber from Canada is still burdened tariffs created by the long dispute between the U.S. and Canada over trade—though those tariffs may ease.
“Tariffs on Canadian lumber are still in place, although the rate is scheduled to be lowered from 20 percent to 8 percent,” says NAHB’s Logan. “That decrease was scheduled to occur midyear by Commerce, but has been pushed back for COVID-related, administrative reasons.”
The pandemic has also caused delays—especially at some of the factories that assemble materials that apartment developers need.
“We have seen some slowdown on deliveries such as appliances, windows, trusses amongst others,” says Padgett.
The number of apartment developers who said their projects were affected by a lack of construction materials is less than a third (29 percent) of the respondents to the NMHC survey, up from 24 percent earlier in the crisis.
“Tile and flooring seemed to be a big chokepoint… along with some electronics coming out of Asia,” says NMHC’s Cino.
At the same time, apartment developers used to have to worry where they would find construction workers, before the crisis. Today just a quarter of developers (25 percent) say their projects are affected by a shortage of labor, down from nearly half (44 percent) earlier in the crisis, according to NMHC.
Also, some of the problems created by the spread of the coronavirus now seem easier for many developers to solve.
Shortages of personal protective equipment, which were the number one cause of delays and disruptions in April (39 percent of respondents at one point), were cited by only 10 percent in the latest survey in June conducted by AGC.
Also, just one-third (38 percent) of respondents say that materials suppliers had delayed or cancelled deliveries, down from nearly half (49 percent) in the previous three surveys.
Source: “Construction Costs Expected to Ease for Apartment Developers”
Balloon Fiesta Postponed Until 2021
Balloon Fiesta is an event that brings our community, city and state together to host thousands of pilots, volunteers and guests from around the world. When COVID-19 first began to impact our world and eventually our community, our non-profit organization held out hope to still launch our event this October. However, with only three-and-a-half months left until the planned start of Balloon Fiesta, there are many variables that are out of our control, potentially impacting the health and welfare of our attendees. The safety of our pilots, guests, sponsors, staff and volunteers has always been our top concern and in the wake of COVID-19 and its continued impacts, we must stay dedicated to upholding that commitment.
The Balloon Fiesta’s volunteer board of directors and 20-person staff have brainstormed many different ways to make the 49th event occur this October. We’ve created various contingency plans and approaches but know that all of those fail if someone contracted COVID-19 as the result of attending our international event. For that reason, we are postponing the 49th Albuquerque International Balloon Fiesta to October 2-10, 2021. Guest reservations, tickets and RV spaces will be unchanged and can be used for the 2021 event. We acknowledge some guests might not be able to join us next year, we respect your choice and have directions to accommodate other options on our website. Of course, we hope you will continue to support
us by using your existing reservation for the 49th event in 2021. For nearly 50 years, the Balloon Fiesta has been filling New Mexico skies with the brightest of colors, this will be the first year since 1972 that we will not hold an event. While saddened to postpone the event, we are excited about the future, flying in Albuquerque and supporting our many communities in 2021.
While the process for this decision has been thoughtful and extensive, ultimately the following factors most contributed to our decision:
- Health & Safety: Like the rest of the world, we are hopeful that the effects of COVID-19 will diminish. However, without a clear understanding of the status of this virus or the applicable New Mexico Public Health Order this October, we can’t proceed with plans that could put anyone working at or attending Balloon Fiesta at risk.
- Financial Responsibility: The Balloon Fiesta is a 501(c)(3) nonprofit organization, led by 24 volunteer board members and a year-round staff of 20. This year we were prepared to host more than 600 pilots, facilitate 1,657 RV reservations, coordinate with hundreds of sponsors, support more than a thousand volunteers, order 230,000 pieces of merchandise, as well as work with entertainers and concessionaires; it’s an extensive process that requires a lot of planning. If we were to move forward with these steps, and in the end not be able to have an event in October, it would put the event and organization in a very vulnerable position.
We are proud of the event Balloon Fiesta has grown into over the years. We know that there is an entire community, city and state invested in its success, making this the most difficult decision we’ve ever faced as an organization. This is certainly a setback, but we will remain committed to making this the best and brightest event in the world and can’t wait to see Balloon Fiesta Park once again filled with balloons and smiling faces.
Matt W. Guthrie,
President, Balloon Fiesta Board of Directors
Download the PDF here.
Source: “49th Event Rescheduled to October 2-10, 2021“


