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How to pay for turbine decommissioning?

Board goes with $2 million letter of credit

Published: Friday, July 11, 2014 1:15 a.m. CDT • Updated: Friday, July 11, 2014 10:14 a.m. CDT
Caption
(Shaw Media file photo)
An aerial view of the Big Sky wind farm in Ohio. At issue with the Bureau County Board recently has been how decommissioning funds for the farm would be handled. On Tuesday, the board voted 16-5 to approve a $2 million letter of credit for the farm, owned by Ever Power.

PRINCETON – After several months of consideration, the Bureau County Board has decided how to handle decommissioning funds for the Big Sky wind farm near Ohio.

Tuesday, the board voted 16-5 to approve a $2 million letter of credit for Big Sky wind farm, owned by Ever Power.

During the public comment portion of Tuesday’s meeting, the board heard from rural Walnut resident Ed Gerdes, who said he and a group of other residents were concerned about granting a letter of credit. Their recommendation would be to go with performance bonds, which he said would cover the entire cost of decommissioning.

The group also was concerned that Big Sky participating landowners would be responsible for making up for lost property taxes as the turbines depreciate.

Although he didn’t agree with those who signed on with Big Sky, they are still friends and neighbors and the group cares about what will happen with them when it comes to decommissioning, Gerdes said.

Ever Power/Big Sky spokesman Mike Speerschneider said the proposed letter of credit would be for $2 million, rather than the current $1.8 million cash-on-hand arrangement.

Letters of credit are a contract between the county and the bank. If there was ever a default or bankruptcy problem with the wind farm company, the bank still would have to pay the full amount to the county, Speerschneider said.

Letters of credit are a common financial instrument in the wind farm industry, he said.

After talking to brokers, the use of performance bonds, as suggested by Gerdes, was not easily done, he said.

Board member Connie Stetson recommended the county keep the cash on hand, which is what she thinks county residents would want.

Board member Steve Sondgeroth also questioned Gerdes about the accuracy of a study used by the group and presented to the board at its May meeting that showed the cost to take down the 87 turbines would be about $224,000 each.

After further examination and study, that number should be more in the $126,000 range, Sondgeroth said.

In a related matter, the board also decided an outside facilitator was not needed to moderate future zoning hearings on wind farm issues.

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