The Turlock Irrigation District board voted Tuesday to sell $450 million worth of bonds to pay for a major wind energy project.
The 136.6-megawatt system in Washington state will allow the TID to meet a state mandate to get 20 percent of its power from renewable sources by 2017.
The bonds will be sold next month at an interest rate to be determined at that time, district spokeswoman Michelle Reimers said.
The system is expected to be ready by early 2010.
The board gave initial approval to the bond issue in December, but the staff waited to assess financial market conditions before moving forward. Tuesday's vote was unanimous.
The wind power is expected to cost 7 to 8 cents per kilowatt-hour. That's more than the TID spends on electricity from its most efficient gas- fueled plant, but less than solar and most other sources of renewable energy would cost.
The project consists of 62 turbines in a windy area just north of the Columbia River. It is being built by Cascade Wind Holdings, based in San Diego County.
The construction cost is estimated at $385 million, but $65 million was added to the bond issue to cover financing and other costs.
The district will sell the bonds to investors and repay them, with interest, from ratepayer money in the years ahead.
The TID currently gets 8 percent of its power from renewable sources, including small hydroelectric plants, a geothermal system and a few solar installations. Large hydroelectric plants, including the one at Don Pedro Reservoir, do not count toward the target.
The TID has about 98,000 electricity customers in an area from south Modesto to northern Merced County, and from the La Grange area to the hills west of Patterson.
The neighboring Modesto Irrigation District has a 12 percent renewable share in its energy portfolio, mostly from wind.
The MID board voted last month to buy at least half of the output of a 100-megawatt wind system planned for the Oregon side of the Columbia River Gorge. This would bring renewables to at least 16 percent of the district supply.
Both districts are bracing for the possibility that state lawmakers will require a 33 percent renewable share by 2020.
Bee staff writer John Holland can be reached at firstname.lastname@example.org or 578-2385.