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Monday, March 14, 2016

Ind. Gov't. - Fight over proposed wind farm contract decommissioning language

James Sprague, Connersville News-Examiner editor, has a lengthy March 13th story (here via The Indiana Economic Digest) regarding the proposed Whitewater Wind Farm project, involving Fayette, Henry and Rush counties. Some quotes:

The complaint, filed by attorney Stephen R. Snyder of Snyder Morgan LLP in Syracuse, Ind., is on behalf of 34 Fayette County residents – spearheaded by residents Craig Mosburg, Joe Schultz and Cecil Bell – who believe the county’s contract with NextEra Energy Resources, regarding the decommissioning of wind turbines in the proposed project, is not valid or in accordance with the county’s zoning ordinance.

The complaint focuses specifically on an addendum to the decommissioning agreement the county and NextEra Energy signed off on for the project in September 2015, which was supposed to clarify language in the contract for how long and how much the security bond required by the energy company would be for regarding decommissioning wind turbines at the end of the project.

The decommissioning agreement between the two parties has been called into question several times since August 2015, when local attorney Gary Smith first broached the subject at the county’s Board of Zoning Appeals hearing concerning NextEra’s special exception applications for construction of the Whitewater Wind Farm project.

Smith pointed out ambiguous language in the county’s agreement with NextEra when it came to decommissioning wind turbines, and the security bond required of NextEra for that decommissioning. Smith told the BZA that the county’s contract with NextEra did not address the cost of decommissioning the wind turbines once the life of the project was over, something that the county’s zoning ordinance required, and that the county’s ordinance required NextEra to have a security bond which lasted the life of the project, but appeared in the contract to be only for a total of 13 years.

“I think the county has an obligation to protect itself,” Smith said at that time. “Either we see to it that our ordinance is followed and we have assurance that absolutely guarantees and insures that when (decommissioning) happens it’s going to be paid for, or we don’t. And if we don’t ... what’s going to happen when they come down is this county’s going to go broke. And we don’t have the money now to take them down. That’s my concern. The general welfare of our community.” * * *

The life of the project, per previous statements from Jeremy Ferrell, project manager for NextEra, is roughly 30 years.

Howard’s concern was that due to the language of the addendum, it could leave open a loophole resulting in the county holding the bag for the cost of decommissioning the turbines, which as of now averages roughly $100,000 a turbine.

Howard questioned further what would occur if Whitewater Wind LLC dissolved and the county had no company to go after for the security bond, or the bond company did not rewrite a security bond for Whitewater Wind LLC after the initial eight-year period. Having language specifically stating the life of the project, in the addendum, would help cover the county, Howard continued at that time.

Posted by Marcia Oddi on March 14, 2016 08:46 AM
Posted to Indiana Government