Illinois Wind Energy Weekend News Roundup

As always, a lot of Illinois wind power news to from the weekend. A quick roundup:

Element Power project moving forward in McDonough Co:

Kim Pierce, administrator of the Macomb/McDonough County Enterprise Zone, told the zone management board Thursday not to expect to see construction begin on wind farms in the county until late this year or in early 2013. Pierce shared a project update letter from wind farm company ElementPower.

In the letter, project manager Gina Wolf wrote, "Although you won't see dirt moving...we still have some big upcoming goals." She went on to state that the company is negotiating road use and repair agreements with Blandinsville and Sciota townships.

Wolf said agreement has been reached with Pioneer Rail to run overhead transmission lines across railroad tracks that run between Good Hope, Blandinsville, and Sciota. She said Ameren Illinois has agreed to allow 13 wind turbines to be located on properties where it holds easements.

Pierce some area farmers have already signed land lease agreements with ElementPower. She said some have already received their first payment checks.

Sangamon Co may soon consider larger setbacks in its wind zoning ordinance, but a developer working in the area isn't too concerned:

Board member Tim Moore, chair of the county’s Public Health, Safety and Zoning Committee, said the county’s zoning code contains setbacks for wind turbines, which state how far away they have to be from a property line or house. The current rule calls for a large wind turbine to be at least 1,000 feet from a house or three times the diameter of the rotors, whichever is greater. [...]

Chris Nickell, vice president for site establishment for American Wind Energy Management, said the company is in the process of closing the land sign-up process for property north of Old Jacksonville Road, which includes the first phase of the project.

“I’d estimate we have around 25,000 acres signed up for this project, which is plenty for us to move forward,” Nickell said.[...]

As far as the setbacks go, Nickell said the company planned to exceed the minimum 1,000 feet all along.

“We intend to use between 1,800 to 2,000 feet,” Nickell said. “Essentially, they could go from 1,000 feet to 1,800 or 2,000 feet and in our eyes, it wouldn’t change the way we are going to lay out the wind farm.”

American Wind energy doesn’t expect to have its application ready for the county during the nine months of the proposed moratorium, Nickell added. As long as there aren’t any dramatic changes in the county’s code, the company expects to submit an application by the end of the year.

“As long as the changes are minor, we don’t expect them to impact us,” Nickell said.

If everything goes smoothly, work could begin by late 2013 or early 2014.

The Lee County Board is considering a setback change to its ordinance as well, but developers in that county are not so keen on the idea:

Under the board’s proposal, turbines must be 1,400 feet away from homes or 3.5 times the height of the turbine, whichever distance is greater. The panel initially considered a proposal that included a setback of 3.2 times the height of the turbine, but board member MIke Pratt wanted that raised to 3.5.

However, representatives of Mainstream Renewable Power, a wind energy company, argued the 3.5 number would make a big difference.

“It would discourage wind companies from coming to Lee County,” Mainstream’s John Martin said.

Mainstream, an Ireland-based company, is planning a wind farm for Lee, Whiteside and Bureau counties. One landowner who plans to participate in Mainstream’s project said increasing the number to 3.5 would impact the company’s plans for his land.

Mainstream, which has yet to submit an application to the county, said it has yet to determine the height of its turbines.

The Tennessee Valley Authority has activated its contract with NextEra's 150-MW White Oak wind project northwest of Bloomington-Normal:

With these newly added wind power sources, TVA now has contracts with five operating wind farms in the Midwest with a combined 542 wind turbines as a result of a 2008 request for proposals for more than 1,500 megawatts of renewable and clean energy.

TVA's total wind energy now activated is 950 megawatts, or more than 3 million megawatt hours annually. That amount provides enough electricity to power more than 200,000 homes in the TVA service region.

Invenergy Sells Part of Bishop Hill Wind Farm to MidAmerican Energy

From a press release from Invenergy (PDF):

MidAmerican Energy Holdings Company announced its agreement to acquire the 81-megawatt Bishop Hill II wind project ("Bishop Hill II") from Invenergy Wind LLC ("Invenergy"). This project, which currently is in construction in Henry County, Ill., will feature 50 General Electric 1.62-megawatt wind turbines.

Bishop Hill II is located near the town of Galva, approximately 40 miles northwest of Peoria, Ill. Construction began in fourth quarter 2011, and Bishop Hill II is expected to be in commercial operation in fourth quarter 2012. Ameren Illinois will purchase the electricity from the project pursuant to the terms of a 20-year power purchase agreement.

Bishop Hill II is the second phase of Invenergy's Bishop Hill Wind Energy Center. The first phase, Bishop Hill I, also is under construction in Henry County and is due to commence commercial operations in 2012.

"We are pleased to reach this agreement with MidAmerican and look forward to working together to make the Bishop Hill Wind Energy Center the pre-eminent wind project in Illinois," said Michael Polsky, president and CEO of Invenergy. Invenergy has developed and placed in-service 26 wind farms in North America and Europe.

"Wind energy is a renewable generation source that meets current and future energy needs in an environmentally efficient and cost-effective manner," said Greg Abel, chairman, president and CEO of MidAmerican Energy Holdings Company. "The Bishop Hill II wind project fits our model of investing in the renewable energy sector."

MidAmerican is the No. 1 rate-regulated utility owner of wind-powered generation capacity in the U.S. The addition of the Bishop Hill II wind project demonstrates MidAmerican's commitment to environmental respect and renewable energy.

MidAmerican began building wind energy projects in 2004. Its first wind project was constructed in Iowa. The company has built or acquired more than 3,300 megawatts of wind generation. MidAmerican has invested approximately $6 billion in wind-powered generation, with projects in Iowa, Wyoming, Washington and Oregon.

MidAmerican Energy Holdings Company MidAmerican Energy Holdings Company, based in Des Moines, Iowa, is a global provider of energy services. Through its energy-related businesses, MidAmerican provides electric and natural gas service to more than 6.9 million customers worldwide. These businesses are Pacific Power, Rocky Mountain Power and PacifiCorp Energy, comprising PacifiCorp; MidAmerican Energy Company; Northern Powergrid Holdings Company; Northern Natural Gas Company; Kern River Gas Transmission Company; and CalEnergy. Information about MidAmerican is available at www.midamerican.com .

Invenergy Invenergy and its affiliated companies develop, own and operate large-scale renewable and other clean energy generation facilities in North America and Europe. Invenergy is committed to clean power alternatives and continued innovation in electricity generation. Invenergy's home office is located in Chicago, and it has regional development offices throughout the U.S., Canada and Europe. Invenergy and its affiliated companies currently have more than 6,700 megawatts of wind, solar and thermal projects under contract, in construction, or in operation. For more information, visit www.invenergyllc.com .          

GDF Suez to Resubmit Permit for 98MW Project in Vermillion Co

Wind developer GDF Suez has resubmitted its application to build a 98-megawatt wind project in Vermillion County, a project that would be the second wind farm in the county and the first in Illinois for the energy conglomerate.

And it sounds like county officials are going about the process very reasonably, allowing the company to grandfather its permit under the county's old wind farm ordinance, and pledging not to make any further changes to the ordinance for at least a year. According to a story in the Champaign News Gazette:

The company's plan is to build about 43 turbines across about 8,000 acres of mostly farmland stretching west and north from a starting point more than a mile west of Rossville's village limits.

International Power GDF Suez was the first wind developer to apply for a permit in Vermilion County. Since then, Chicago-based Invenergy applied for a permit, received it and started construction late last year. That will be a farm with more than 130 turbines stretching from west central Vermilion County in the Newtown area to east central Champaign County.

Also in the last year, the county board has made some changes to its wind turbine ordinance, but McMahon said he's recommending that the county board grandfather in International Power, because its original permit request was made prior to the changes. The county now requires a higher permit fee and longer distance between wind turbines and nearby building structures.

The prior permit fee was $1,000 per turbine, and the new one is $3,000 per turbine. International Power America Inc. already paid its $40,000 permit fee last year at the original fee level. McMahon said the county could enforce the new permit fee, but he's recommending that the county not do that.

Also, McMahon said, he's going to recommend that the building permit have a time limitation of one year with the possibility of a one-year extension upon a written request from the company. He said the company shouldn't be able to lock up all that land and not move forward when there could be another company interested.

McMahon said he also has no intention of considering any additional changes to the wind ordinance for at least a year.[...]

"We have established an ordinance. We tweaked it to satisfy some constituents, so we're done. It's going no further," he said.

1/20 Update: A Vermillion Co committee has approved the company's application, which now heads to the full County Board, says an article in the Danville Commercial News:

Despite concerns voiced by a couple of residents, the county’s structural safety committee approved a permit application for the construction of the Hoopeston Wind Energy Farm on the north end of Vermilion County.

GDF SUEZ Energy North America Inc. based in Houston, Texas, is coordinating the project, which calls for the construction of 43 wind turbines along a stretch from around 3 miles east of Illinois Route 49 to the area near the Hubbard Trail Country Club north of Rossville.

The committee voted 5-1 to approve the permit application. Committee member and county recorder Barb Young, who requested to see the motion in writing prior to voting on it, voted against it. Robert Watson did not attend the meeting.

The wind farm permit application still must be approved by a vote of the full county board, which next meets on Feb. 14.

Woodford County's First Wind Farm Brings Flood of Tax Revenue

Some good news came out of Woodford County this week, which has been eagerly awaiting the construction of its first wind project for several years. As reported in the Woodford Times, the county has already received nearly one million in new revenues from a new wind project near Minonk, and construction hasn't even begun yet.

This is just one more example of how wind turbine revenues can help economically stressed local governments in Illinois.

Initial construction on a wind energy facility in Woodford County has yet to begin, but the county already has received a financial windfall from it.

Gamesa Technology Corp., the developer of Minonk Wind LLC, has issued the county two checks that total almost $900,000, Zoning Administrator Kim Holmes said.

Special-use permits, 911 addressing fees and storm water-control fees for 75 wind turbines accounted for $369,625. The remaining $525,000 was paid as part of the state’s high-impact business program, which involves tax credits similar to those offered within an enterprise zone.

Holmes revealed the dollar figures Tuesday night during the Woodford County Board’s conservation, planning and zoning committee’s regular meeting. She said she received the checks earlier that day.

Once Gamesa provides the county with a letter of credit, the permits are expected to be issued for a project proposed almost four years ago.

“I’m glad the decision has been made and that definitely this is happening,” Holmes said. “Now we know which direction we’re going to go.”

The County Board approved the project in July 2010. The wind farm is located east-southeast of Minonk and extends into Livingston County, where an additional 25 turbines are to be built.

David Rosenberg, vice president of marketing and communications for Gamesa, said the letter of credit probably will be issued next week. Construction could commence in early April, he said, and take between three and six months.

“This is a fairly sizeable wind farm,” Rosenberg said Wednesday by telephone from Gamesa offices in suburban Philadelphia. “This demonstrates how Illinois is rapidly becoming a leader in clean-energy development. It’s a good project.”

Gamesa has constructed four other wind farms in Illinois - about 290 turbines located in Bureau, LaSalle and Lee counties, Rosenberg said.

The permit money already had been accounted for in Woodford County’s budget for the 2012 fiscal year. That budget projected a surplus of about $290,000.

Once the wind farm is operating commercially, Gamesa is to owe the county $2,475,000, a second high-impact business payment.

Iberdrola Acts to Comply with Bureau Co Ordinance, Avoids Fines

When Iberdrola discovered its Providence Heights project included turbines accidentally sited closer to neighboring property lines than allowed under Bureau County's wind ordinance, the company voluntarily took action to right the mistake, avoiding a citation this week from the County Board.

Because the company acted to comply with the ordinance, the Board voted Tuesday not to fine the company for the violation, says an article in the LaSalle News Tribune:

Board member Dan Rabe suggested that another mitigating factor might be that Iberdrola began addressing the violations on its own. By purchasing the land where it had exceeded the setbacks, the wind farm developer remedied each of the violations between 2008 and 2010, [Board Member Joe] Bassetti said.

"They didn't wait for us to tell them to clean up their act," said Rabe. "When they found themselves in violation, they started to clean up the problem, like by buying the other land."[...]

Bassetti made a motion Tuesday for the state's attorney to start the process to issue fines against wind farm developer Iberdrola Renewables for three wind turbines and one meteorological tower in the Providence Heights wind farm that were built too close to adjoining properties.

Bassetti said he wants the county to issue the fines to send a message to future wind farm developers that they need to follow the zoning ordinances and that they can't walk all over the board.

Board member Mike Maynard said he agreed, but it's now several years after the fact in each of the instances Bassetti cited.

The three wind turbines and met tower in question were constructed in December 2007, Bassetti said.[...]

Eleven board members voted to impose the fines. Fifteen voted no, defeating the motion.

Anti-Wind Activists Again Call for Turbine Ban in Ford County

A group of anti-wind forces in Ford County is again calling on the Ford County Board to enact wind turbine siting regulations so strict they would drive development from the county, says an article in the Champaign News Gazette:

The Ford County Board has been confronted with yet another request from a resident concerned about wind farms. And again, the board offered no discussion on whether it would consider adopting stricter regulations.

In the past year, the board has repeatedly been asked — but has refused — to discuss possible revisions to the county's ordinance regulating wind farms. Until Monday's meeting, the requests have been made mainly by Cindy and Ann Ihrke, two candidates for the board in the March 20 primary election who are both members of Energize Illinois, an organization opposed to the wind-energy industry.[...]

But on Monday night, the person requesting greater protections was Tom Harrison. His home southeast of Paxton is about a quarter-mile from one of the 94 wind turbines built last fall as part of the Pioneer Trail Wind Farm.

To protect people living near future wind farms in Ford County, Harrison suggested the board increase the county's existing 1,000-foot setback between wind turbines and "non-participating" landowners' homes. Harrison said he has heard that turbines need to be at least "a half-mile or a mile" from a home to be considered a comfortable distance away.

Citing research, the Ihrkes have also asked the board to consider amending the ordinance to require a greater setback.

Crain's Spotlights IPA Director Juracek, Discusses Possible Conflict of Interest

Crain's Chicago Business put a spotlight on Illinois Power Agency Director Arlene Juracek this week, focusing on her role in brokering 4.5-year power deals with her former employer Exelon and asking if a conflict of interest exists in a state employee brokering deals with a company in which she owns stock.

The piece makes for fascinating reading in the ongoing saga of Illinois energy politics, but also offers a few nuggets of information useful to the wind industry: 1) Juracek may not be long in the job, as the state's Ethics Commission is currently seeking a new director; and 2) Former IPA Director Mark Pruitt does not want the job back.

From the article:

Arlene Juracek—an Exelon shareholder whose October appointment to head the Illinois Power Agency caused an uproar—is about to solicit bids to provide electricity to utility customers statewide from mid-2013 until the end of 2017. Observers say Chicago-based Exelon may not have much competition due to the contract's duration and credit requirements that could disqualify many other suppliers.

The setup is yet another sign of the dysfunctional nature of state government. It puts a shareholder in the state's biggest power generator in position to strike a long-term deal for the same company despite conflicts of interest that were meant to be eliminated when the state wrested control of power purchasing from utilities four years ago.

Ms. Juracek, an employee of Exelon's Commonwealth Edison Co. for more than three decades until her 2007 retirement, has pledged not to sell her Exelon stock, which she declines to quantify, for at least two years.

.

In an interview, she minimizes her role in the upcoming procurement, saying, “I'm the orchestra conductor making sure all the instruments are playing their role in the symphony.”

SMART GRID

The IPA director is required to complete the solicitation by Feb. 23 under the “smart grid” law enacted late last year over Gov. Pat Quinn's veto. The act permits ComEd to raise electricity delivery rates annually for the next decade to finance a $2.6-billion power-grid modernization. The idea behind the long-term power contract was to lock in today's low energy prices to blunt the impact of the law's automatic rate hikes on utility customers, whose electric bills include both the cost of power and its delivery.

After being given oversight of the IPA in November, the Illinois Executive Ethics Commission quickly mounted a search to replace Ms. Juracek. But it won't have anyone in place before March 1, commission Executive Director Chad Fornoff says.

Former IPA Director Mark Pruitt, whom Mr. Quinn replaced with Ms. Juracek after Mr. Pruitt resisted the governor's calls to hand out 20-year sales contracts to Illinois wind farm developers, has rejected entreaties to return to the job.

House Speaker Michael Madigan, a Pruitt supporter, spearheaded the change in law that yanked the IPA from the governor. But his action came too late to protect Mr. Pruitt, who is building a burgeoning consulting practice.

A spokesman for Mr. Madigan says the speaker hasn't taken a position on Ms. Juracek or her management of the procurement. He says the issues are in the hands of the executive branch. “The Legislature's role really has kind of concluded at this point,” he says.

A spokeswoman for Illinois Attorney General Lisa Madigan, who along with Mr. Madigan, her father, championed the IPA's creation and backed Mr. Pruitt, declines to comment. Ms. Madigan's office expressed concerns about Ms. Juracek's potential conflict of interest when she was appointed.

FALLING DEMAND

In Northern Illinois, where demand from utility customers is expected to shrink as suburbs strike money-saving deals with alternative suppliers on behalf of their residents, the IPA is looking to buy just 500 megawatts of power, Ms. Juracek says. That's less than 10% of ComEd's current demand and a quarter of the 2,000 megawatts some in the industry were expecting. Bidders will offer one price, which automatically will increase 2.5% annually over the course of the contract.

She's hired a consultant to produce a “benchmark” representing what a fair price would be over the four years and seven months of the contract. She says she will play only an advisory role in that calculation and that the consultant will make the final call.

Bidders won't know the price target, and any bids above it won't be accepted.

There will be no haggling after the fact, no sitting across the table from execs at her former employer. “I don't negotiate with any of the bidders,” Ms. Juracek says.

Mr. Pruitt, who until October had been the state's first and only IPA director, says the IPA never deferred to a consultant to set a price benchmark before. He points out that the consultant works for the IPA, not the other way around.