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CORVALLIS, Ore. - Wind energy development in Umatilla County could provide a multi-million dollar impact on the state's economy, according to a recent special report released by the Oregon State University Extension Service.

OSU researchers used economic models developed by the National Energy Renewable Laboratory and the university to estimate both the current impact of the wind industry, and also what the impact of wind energy development would be in an "optimized" economy. An optimized economy is one in which at least 75 percent of the businesses and facilities needed to support wind development are local.

According to the report, "Umatilla County's Economic Structure and the Economic Impacts of Wind Energy Development: An Input-Output Analysis," Umatilla County's wind industry has the potential to grow into a $40 million business and provide numerous new jobs to the area's rural communities if local infrastructure is developed.

"In the last 25 years, many rural communities have gone through a significant economic decline," said Bruce Sorte, a community economist in OSU's College of Agricultural Sciences. "Small manufacturing shops and trucking operations have closed their doors or moved to more metropolitan areas. Local wind energy development provides an opportunity to rebuild rural infrastructures and revitalize communities."

The OSU study focused on Umatilla County, which is Oregon's leader in wind energy development. However, other Oregon counties also may have the potential to develop a wind energy industry and the same optimizing factors are relevant, the researchers say.

Umatilla County has the capacity to generate about 480,000 megawatt hours of wind energy per year, or enough energy to power roughly 46,000 Oregon homes annually. However, most of the current development is at a non-local level.

But that's not necessarily a bad thing, said Melissa Torgerson, a graduate student in OSU's Master of Public Policy program, and one of the report's authors.

"In the case of non-local investors, the long-term impacts of wind energy development come from land lease payments made to local farmers and landowners, as well as county property taxes," she said. "Land lease payments to landowners who place turbines on their land provide important supplemental household income, particularly for farmers.

"This income can then be reinvested into the community economy as households purchase goods or pay for services at the local level," Torgerson added.

The income from land payments can be difficult to predict, however.

The researchers found that methodologies used for assessing land value are varied, resulting in some uncertainty around income projections and in the planning for wind power development. Consistency in the land assessment process could increase total revenues for all counties wanting to develop wind energy, they said.

Torgerson added that when wind energy development is controlled locally, revenues are often spent in local businesses, resulting in profits to the local economy. To attract investors, she says, rural counties need to explore the option of dovetailing business development in relevant industrial sectors. The availability of local suppliers could prevent a significant portion of money spent on maintenance from leaving the local economy, and offset the leakage of sales revenues to outside investors.

"Regardless of whether projects are owned by a single farmer, multiple investors or a community, rural counties have the potential to gain from local ownership," said Torgerson. "Revenue from non-locally owned wind farms tends to 'escape' the local economy. Our research indicates that if local capital could be used to support local ownership of wind turbines, the economic impacts of wind power development may be doubled or tripled."

In order for rural communities to succeed in local wind energy development they must look at start-up costs and the feasibility of wind power generation in their area. Gathering information about wind data, permitting processes, tax incentives and financing costs is a key first step for communities wanting to get involved in wind energy investment, said Torgerson.