Associated Press
Thursday, July 5, 2007

LUBBOCK — Oil gushed from the vast scrub brush terrain of the PermianBasin and made millionaires of many. From the High Plains just to the north came cattle, cotton, and food crops.

West Texas held its own economically for decades. But since the 1980s the region has seen population dwindle and economy shrivel.

While the numbers of farmers, ranchers and oil field workers have been on a steady decline over the past decade, hardy West Texans have been adapting.

The region long known for sheep and goats, cattle feedyards, cotton fields and oil derricks is evolving into a hub of alternative energy, with plans for ethanol plants and wind farms, and possible nuclear reactors and coal-powered plants.

"These rural communities have to find something they can have in their area that provides quality of life and will generate the economic activity that allows communities to thrive and grow," said Greg Clary, a Texas Cooperative Extension economist who works with the Texas Center for Rural Entrepreneurship.

Just last week, a University of Tennessee study projected that Texas would lead the nation in production of renewable energy by 2025, creating more than 173,000 jobs and adding about $22.8 billion annually to the state's economy.

The report was commissioned by the National 25x'25 Alliance, a group of organizations and individuals shooting to have 25 percent of the nation's energy come from renewable sources by 2025. Nationally by that year, the renewable energy effort was forecast to have an annual economic impact of $700 billion and create 5.1 million jobs.

Already, West Texas has begun moving in that direction, and efforts continue to expand the region's energy industry. Cities and counties across the region have economic development corporations, which work to attract businesses and create job opportunities. Some are funded by a portion of sales tax revenues allowable under state law while others are privately funded.

Here's a look at some energy projects - proposed, underway or already in place - that many believe will revitalize West Texas.

-- WIND: Since the mid-1990s, wind turbines have stretched skyward in Texas; in 1999, the bladed towers began to dot mesas across portions of West Texas. The state last year surpassed California as the nation's leading producer with 2,370 wind-generated megawatts, enough to power 600,000 homes a year.

That number could grow significantly in coming years, and breezy West Texas would benefit. Billionaire T. Boone Pickens recently announced plans to build a 4,000-megawatt wind farm - the world's largest - in the Panhandle.

-- ETHANOL PLANTS: Three plants are under construction in West Texas. Two plants in Hereford and one in Levelland will produce 240 million gallons a year when completed. Statewide, eight more are planned. Four of those, potentially totaling another 380 million gallons a year, would be built in West Texas.

One of the Hereford plants, owned by The Panda Group of Dallas, will turn manure from nearby feedyards and cotton gin waste into fuel.

-- NUCLEAR: The University of Texas system, Permian Basin cities and private industry hope to bring the nation's first High Temperature Teaching and Test Reactor to Andrews County. A feasibility study is under way on the reactor, which would cost $400 million and be completed by 2012.

If built, the reactor would use fuels that include uranium, some types of plutonium and thorium, and spent reactor fuel elements now in secure locations across the country.

Fuel pellets about the size of poppy seeds would be covered with three layers of ceramic coating and do not rupture up to 3,600 degrees, according to University of Texas-Permian Basin's Jim Wright, a spokesman for the project.

At high temperatures it's believed the reactor can generate hydrogen as an alternative energy source.

The reactor, which would be part of an energy research facility, is considered safer than traditional nuclear plants. Because it is cooled by helium rather than water, there is no danger of a meltdown, according to Wright. Japan and China are currently the only countries with high temperature test reactors, and each is working to generate hydrogen.

Andrews County already has a nuclear-related industry. Dallas-based Waste Control Specialists currently stores 45,000 tons of Cold War-era radioactive waste and is seeking a license to dispose of it.

A couple of hundred of miles north in Amarillo, a developer is seeking federal approval to build a nuclear power plant. The city has long been home to Pantex, the nation's only nuclear weapons assembly and disassembly facility.

George Chapman and his company, Amarillo Power, and UniStar Nuclear plan to apply to the Nuclear Regulatory Commission next year for a permit to build and operate the plant. Technical reviews for the license and hearings could take four years, NRC officials have said.

No location has been disclosed.

-- COAL-POWERED PLANT: The Permian Basin is one of four sites - two in Texas and two in Illinois - that are finalists for the $1.5 billion project headed by the U.S. Department of Energy and a consortium of 10 energy companies from the United States, China and Australia.

The plant, billed as a prototype coal-fueled power plant that produces almost no pollutants, would store carbon dioxide, a heat-trapping "greenhouse" gas, underground. Possible locations are Mattoon and Tuscola, in eastern Illinois, and Odessa and Jewett, in Texas. A site is expected to be chosen in September.

Breathing new life into the basin's economy now, though, is a resurgent petroleum industry, spurred by the high price of oil.

In a region long known for agriculture, West Texas is eager to expand its economy beyond food and fiber, Texas Agriculture Commissioner Todd Staples said.

"I think we need to be smart and selective when we go after projects," Staples said. "We need to look at the entire set of ramifications, but I see opportunity in this and I see an ability to attract new minds and new talent to the rural parts of Texas that have been suffering from a lower population base."

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