A Wind Energy Windfall for Rural Communities: What More than $800 Million in Economic Impact and Tax Revenue Could Mean for the Magic Valley

Creating domestic energy that can serve Idaho residents and connecting states does more than fill the tremendous need for clean energy across the West. Idahoans will also profit from a substantial economic surge that will benefit schools, highway and recreation districts, cemeteries, and rural fire and ambulance services.

Magic Valley Energy’s two wind energy projects, Lava Ridge and Salmon Falls, were analyzed in an economic impact report by Dr. Geoffrey Black, a professor in the Department of Economics at Boise State University, and Steven Peterson, a Professor in Economics at the University of Idaho.

Their study estimated the economic and fiscal impacts of the construction activities and the continued operation of the two projects using IMPLAN, the most widely used economic impact analysis model in the United States. In their analysis, Black and Peterson based their modeling on each project’s anticipated investment, employment, and generating capacity. The magnitude of the economic impact realized will be influenced by the size of the projects approved by the Bureau of Land Management’s permitting decisions.

Construction Phases Projected to Bring More Than $800 Million in Economic Output

The construction phase of each wind project is estimated to last two years. The large expenditures and labor demand for the projects’ construction activities will significantly increase employment, compensation, regional business activity, and tax revenues.

These revenues will come from the direct purchase of construction materials and the indirect and induced economic effects of related business activity. The influx of construction activity will generate significant business for surrounding hotels, restaurants, housing, local businesses, and shopping centers.

The economic analysis shows the construction phase tax revenue from Lava Ridge could be more than $80 million for Idaho’s coffers, while the economic output (employee compensation + proprietor income + intermediate expenditures) could be more than $500 million. The Salmon Falls project construction phase is estimated to bring in $46 million in tax revenue and $300 million in economic output.

According to Black and Peterson, “the economic impacts from the construction of the two wind farms will be significant, especially in the relatively rural southeastern Idaho region. These impacts will provide large increases in various economic activities, including employment, incomes, and economic output, in the south-central Idaho region every year over the two-year construction period. Cumulatively, over the course of the construction horizon, these impacts will lead to dramatic increases in the levels of employment, incomes, and economic activity in the area.”

More than 700 workers are expected during the peak of construction activities for Lava Ridge. Magic Valley Energy prioritizes using local contractors and vendors and hiring local workers for the projects. The Lava Ridge project is projected to begin construction in late 2023, while Salmon Falls is proposed to start construction in 2025.

Ongoing Operations Projected to Bring More Than $6.3 Million of Annual Tax Revenue to Local Counties

The ongoing bonus for Idaho comes in annual tax revenue to local counties. Once in operation, the two wind projects are projected to provide an estimated $6.3 million annually to local counties’ tax base, mainly benefiting school districts like Filer, Jerome, Shoshone, Dietrich, and Minidoka, as well as highway districts and fire and ambulance services. The estimated 40 permanent jobs will produce an economic impact of $15 million annually due to the well-paid salaries for wind technicians and operation teams.

While actual economic impact values and tax receipts will be driven by the development areas approved by BLM, the benefits to counties like Lincoln, Jerome, and Twin Falls could be substantial. Lincoln County could receive an annual boost of more than $590,000, while Jerome County could receive more than $868,000 yearly. Jerome School District could see more than $375,000 annually, and the Filer School District could receive around $614,000 each year for the 30-year lifespan of the project.

Access to unrestricted funding would allow school districts to support staff development and training, aid in facilities upgrades, parking lot pavement, classroom equipment, and student travel.

Community Support is a Core MVE Value

What was not analyzed in the economic analysis? The support MVE will continue to contribute to community projects in Southern Idaho.

When Hollister Elementary Booster Club and community members heard their school was at risk of closing permanently due to a staff shortage, they reached out to Magic Valley Energy for support.

Magic Valley Energy has donated more than $40,000 to local needs in the Magic Valley from local food pantries, Hollister’s Elementary Booster Club, College of Southern Idaho scholarships, and local education foundations and booster clubs located within Lincoln, Jerome, Minidoka, and Twin Falls Counties.

“Magic Valley Energy has been the backbone of helping to keep our school open,” said Hollister Mayor Robyn Grover. “It has given us resources to help these kids stay in their hometown school to stay close to their parents. I love that Magic Valley Energy was so helpful and kind – so giving.”

Magic Valley Energy believes in giving back to local nonprofits, cities, and counties and partnering to address community challenges.

“We’re committed to providing community support, well-paid careers, and a positive economic impact to Southern Idaho,” said Luke Papez, MVE Senior Project Director. “Supporting education and community initiatives is essential to being a part of the communities we’re working within.”

From increased tax revenue, dramatic economic output dollars, well-paid jobs, and on-going community support, the opportunities Lava Ridge and Salmon Falls wind projects bring to Southern Idaho will have an incredible benefit for many years to come.