A wind rush of sorts is happening in the Mexican state of Baja California, which has a population of less than 3 million. Two estimates of the wind energy potential in Baja range from 5 gigawatts, according to California's Renewable Energy Transmission Initiative, or as much as 10 GW, according to studies done by KEMA Inc. and Bates White for the California Energy Commission.

A small 10-MW wind farm began commercial operations near the United States border this year. Although this small energy project is intended for local Mexican consumption, developers are eyeing much bigger wind farms in Baja that would export clean renewable electricity to the United States.

Baja Governor Osuna Millán has signed a memorandum of understanding with California Governor Arnold Schwarzenegger which commits the two states to work closely together on renewable energy issues.

Only the very deep-pocketed need apply, however. Almost 4 GW of wind project applications were withdrawn over the last year after the California Independent System Operator reformed – albeit made more expensive and risky – the interconnection process for smaller companies with lesser capitalization.

One of the start-ups that attempted to reap the wind potential in Baja is San Francisco's Asociados PanAmericanos, begun by James Walker of Minnesota’s EnXco and Steve Tabor, whose start-up Nordic Windpower just won funding from the Energy Department this year.
APA partnered with the Pai pai, the indigenous people of Baja’s Santa Catarina region, to build a giant 1-GW to 1.5-GW wind farm on 263 square miles of land.

The Fortune 500 giant Sempra Energy is the only large company looking at the area. The company has an application for a 1.1-GW wind project right at the Baja-United States border.

But of all the applications, only giant Sempra's project has held fast. Most of the smaller developers, including APA, were unable to raise the money for their pro-rated share of the cost of the transmission upgrades needed under the new California I.S.O. rules.

San Diego, California-based Sempra made $11 billion in revenue last year. It operates 2.6 GW of natural gas projects, but appears to be moving ahead with solar and wind, too. It just began commercial operations of a 200-MW wind farm in Indiana last month and has signed contracts for small amounts of solar power with Pacific Gas & Electricity.

Meanwhile, APA will apply again in the next California I.S.O. interconnection application window in 2010. For now the company is gathering meteorological data; working on federal and state permitting and environmental studies; and looking for a buyer for the output of the wind farm.

APA may be smaller than Sempra, but its more focused renewable energy portfolio stands it in good stead. The company just completed another 67.5-MW wind farm in Mexico to supply a Walmart operation in Oaxaca. And in partnering closely with the indigenous Pai pai, it is bypassing the nimbyism so prevalent in the United States.

-   Susan Kraemer