Wind Energy in Perspective

1. Wind Energy in Perspective Lisa M. Daniels Windustry Michigan Wind Working Group December 9, 2003

2. Windustry • Creating a wind energy knowledge base with rural landowner/community perspective • Provides technical support • Performs wind energy outreach • www.Windustry.org • Online info and tools • Local, state, regional and national forums • Coming: Wind Farmers Network

3. Windustry’s Wind Farmers Network • A network for landowners, farmers, ranchers, farm organizations, businesses, community leaders and others. • A membership-based exchange for case studies, individual experiences, lessons learned, negotiating points, and more. • More info on wind easements and development models. • comOnline at www.Windustry.org

4. Topics in this Presentation • Wind rights • Wind Easements • Wind Energy Impacts • Permitting • Process • Considerations • Who does it • Siting • Other comments and questions

5. A Wind Energy Leader • Minnesota - a typical story for the Midwest

6. Why Minnesota?Why Wind Energy? • Public Policy - 1994 Legislative session • High Stakes - Mandate for some renewables in order to allow Nuclear Waste Storage • Wind Energy Drivers • Economics • Environment • Energy independence/security • Local/state policy and grassroots support • New development models are emerging…

7. What makes a good wind project? • Average wind speed • Proximity/access to the grid • Cost of capital • State and Federal incentives • Market for the power • Community enthusiasm/ acceptance

8. Wind Development Models Three Main Types: • Large Wind Plants (large number of utility scale wind turbines) • Dispersed Wind Projects (a few utility scale wind turbines) • includes distributed generation • Small wind turbines (residential or sm. Business size)

9. Large Wind Plants • Concentration of large wind turbines. • High voltage transmission lines required. • Power delivered to distant population or load center. • Economies of scale are the main advantage here. • Currently the most common model of development. • Local involvement is mostly wind easements and tax revenue.

10. Southwest Minnesota

11. Dispersed Wind Development • Single or small clusters of large wind turbines • Connected to existing or upgraded distribution grid • Power contracted for distant load or local use, (local use is distributed generation) • More and more examples of locally-owned/financed dispersed projects • Often owned & operated by local utility, farmer/landowner enterprise, small business or community-based entity, i.e. school district

13. Large wind projects:Local involvement- wind easements • No standards • Some good, some bad, some ugly • Terms • Wide range, $2,500-$6,000 per turbine per year • Range from 20 years to perpetuity, most common 25-40 years • Main benefit • A way to participate in wind development with no cash outlay from landowner • Little or no risk to landowner

14. Easements: Lessons Learned Best results when landowner has good info on: • The area’s wind resource • Wind developer’s history • Wind energy project economics • Stays involved with siting of machines and roads • Size of machine developer will use matters if easement is based on a percent of revenue • Consult a qualified attorney before signing anything.

15. Easement Issues • Definitions: • When the contract begins • When it ends • What happens when no development takes place • Can I work with the guy who will be siting the wind turbines • How much of my land is included • What is included in gross revenue of project

16. South Dakota Statutes State Limits • 5 yr options • 50 yrs wind easements • Severability - wind rights can’t be severed from the land • Property Taxes on foundation, tower and some infrastructure -in line with neighboring states

17. Landowners Payments • The Result: Wind Easement Contracts are becoming more lucrative for landowners • Old: $2,000 per year per turbine (based on late 1990s Enron developments in Iowa) • Recent: Reports of $5,000 or $6,000 per turbine per year in Illinois

18. Large wind projects:Local involvement- Tax revenue and Jobs Case Study: Lincoln County, MN (population: 6,429, per capita income: $19,935) • Tax Revenue • Collected $757,634 from 156 MW in 2002. (25% of total county tax revenue) • Jobs • 31 jobs are supported annually for operations and maintenance for 107 MW project • Construction phase of same 107 MW project supported 150 jobs.

19. Community Commercial- Scale Wind Projects- Public Utilities • Municipal Utilities Examples: Moorhead, MN • Waverly, IA • Hull. MA • Rural Electric Cooperatives Examples: Kotzebue Electric Association, Alaska • Last Mile Electric Cooperative, Oregon. Moorhead, Minnesota

20. Community Wind Projects • School districts Examples: Spirit Lake, IA • Eldora, IA • Lac Qui Parle School, MN- integrated into school curriculum • Tribal Communities Example: Rosebud, SD- first Native American-owned large-scale wind turbine in the US

21. Wind Energy and Economic Development • Large non-local wind projects • Wind easements • Local tax revenue • Jobs • Community and Local projects • Same benefits as above • Energy production revenue stays local • Tend to use more local businesses (such as banks, engineering firms, and construction contractors)

22. Economic Development for Communities- Tax Revenue • Largest benefit to whole communities from large wind farms is tax revenue • For example: • Lincoln County, Minnesota 2002 (Pop. 6,232): $757,634 from 156 MW (25% of total county tax revenue). • Pipestone County, Minnesota 2002 (Pop. 9,761): $389,789 from 113 MW (10% of total county revenue). • Worth County, Iowa - the new 80 MW project will add an estimated 9% to the county tax base.

23. School Wind Projects: Eldora, Iowa

24. Kas Brothers Plant 25-Year Cash Crop • First farmer owned commercial-scale projectin US. • Two 750 kW Micon turbines installed in summer of 2001. • Financed with local banks (had an equity partner) • Dozens of farmers in MN now following this model. Richard and Roger Kas --Woodstock, MN

25. A growing group of Minnesota Wind Farmers • "Combines cost you $150,000. You use it two, three, maybe four weeks out of the year. This costs you over a million dollars, but it runs 365 days a year. So when it all boils right down, I think this is a better investment," Pam Fey, Woodstock, Minnesota. Fey family wind turbine under construction. Photo by Mark Steil/MN Public Radio

27. Wind Energy Permitting Process • Typically wind projects are required to obtain a permit from one or more government agencies. • Often jurisdiction is local (planning commission, zoning board, city council, county board etc.) • Federal agencies such as the Bureau of Land Management and Federal Aviation Administration can come into play.

28. Typical steps in permitting • Pre-application • Application Review • Decision-making • Administration and Judicial Review • Permit Compliance (NWCC Permitting Handbook, 2002)

29. Principles Common to Successful Permitting Processes • Significant Public Involvement • Issue-Oriented Process • Clear Decision Criteria • Coordinated Permitting Process • Reasonable Time Frames • Advance Planning • Timely Administrative and Judicial Review • Active Compliance Monitoring (NWCC Permitting Handbook, 2002)

30. Specific Permitting Considerations • Land Use • Noise • Birds and other wildlife • Aesthetics • Soil Erosion and water quality • Public health and safety • Archeology and Paleontology • Solid and hazardous wastes • Air quality and climate (NWCC Permitting Handbook, 2002)

31. 1. Land Use • Wind turbines should be compatible with other land uses. • Agriculture generally works well with wind energy.

32. 2. Noise Wind turbines generate sound levels no higher than a moderately quiet room at distances of 750-1,000 feet.

33. 3. Bird and Wildlife impacts • Concerns include: • Direct fatalities (such as bird and bat collisions or electrocutions) • Loss of habitat • Loss of natural vegetation • All of these impacts can be mitigated with thoughtful siting.

34. 4. Aesthetics • Highly subjective subject • Many things can be done to reduce visual impacts: • Spacing and turbine design • Markings and lighting • Roads on slopes • Building and storage

35. 5. Soil Erosion and Water Quality • Mostly an issue during construction. • Good construction practices can go a long way toward preventing permanent harm to soil or water resources.

36. 6. Public Health and Safety • Health concerns related to energy generation usually stem from harmful emissions released into the environment. • Wind energy is emission-free • Appropriate setbacks and signage protect public safety.

37. 7. Archeology and Palentology • Culturally, historically, or scientifically important sites could be damaged by wind energy development. • Usually project plans can and should be adjusted to avoid such sites.

38. 8. Solid and Hazardous Waste • Relative to other energy generation technologies, wind power produces little waste. • Considerations: • Construction produces solid waste that must be removed. • Poorly designed turbines could leak gearbox oils, hydraulic or insulating fluids.

39. 9. Air Quality and Climate • Use of wind energy reduces air pollution and greenhouse gas emissions by displacing fossil fuel use.

40. Case Study: Minnesota • Minnesota Environmental Quality Board had jurisdiction over permitting wind projects over 5 MW. • Process includes streamlined review process (usually 60-90 days, 180 day max.) and environmental review. • Smaller projects are approved by local governments, usually counties. (NWCC Permitting Handbook, 2002)

41. Case Study: Minnesota • Wind turbines have been widely accepted by local communities. • Issues that have arisen include: • Limited impact on TV reception • Some aesthetic complaints • Long term avian study in Buffalo Ridge area showed wind turbines to have minimal impacts on local birds. However, a number of bat fatalities was recorded, prompting a bat study.

42. Case Study: Minnesota • Lessons learned: • High standards have been established to protect interests of local communities and residents. • Efficient and flexible process for developers. • Successful projects must address the needs of both the developer and the community.

43. Case Study: Lincoln and Kewaunee Counties, Wisconsin • Developer Madison Gas & Electric accelerated its timeline due to beat the expiration of the Federal Tax Credit. • Result was a hasty community outreach effort that left the community feeling “ambushed” and some vocal opposition to the 9.24 MW project. • Developers need to have established public support before and should be aware of specific local issues before moving forward with permitting applications.

44. Case Study: Lincoln and Kewaunee Counties, Wisconsin • Lessons Learned: • Developers need to have established public support before and should be aware of specific local issues before moving forward with permitting applications.

45. Siting and Permitting Guidelines and Resources • National Wind Coordinating Committee’s Permitting of Wind Energy Facilities Handbook, 2002. www.nationalwind.org/pubs/permit/permitting2002.pdf • U.S. Fish and Wildlife Service’s “Interim Guidance on avoiding and minimizing wildlife impacts from wind turbines.” www.fws.gov/r9dhcbfa/wind.pdf • American Wind Energy Association’s Model Zoning Ordinance for small wind turbines. www.awea.org/smallwind/documents/modelzo.html • AWEA’s Small Wind Turbine Permitting Handbook, Learning from the California Experience. www.awea.org/smallwind/documents/permitting.pdf

46. Article: www.dnr.state.mn.us/volunteer/novdec03/wind.html Editorial: www.dnr.state.mn.us/volunteer/novdec03/thisissue.html

47. Wildlife/natural resource conservation voices for wind “The most beautiful thing about wind turbines is not visible at all: It’s cleanliness—clean energy. That enormous benefit may not always offset the drawbacks of wind-fueled energy, but it ought to make us think twice about tilting at giant windmills as if they were monsters.” – Kathleen Weflen, editor, Minnesota Conservation Volunteer, MN DNR

48. How to view wind power • As a tool for economic development in rural communities. • As a significant new crop for farmers. • As a home-grown energy resource. • As a clean alternative to traditional energy generation technologies. • A new industry for rural economy.

49. Contact Us Windustry 2105 First Avenue South Minneapolis, Minnesota 55105 toll free(800) 946-3640  main phone(612) 870-3461   fax(612) 870-4846   e-mailinfo@windustry.org www.Windustry.org