Group files complaint, alleges decommissioning agreement not valid
Things had been quiet locally, thus far in 2016, regarding the proposed Whitewater Wind Farm project.
Not any more.
The fight against the proposed wind farm project has been picked back up again, by a large group of Fayette County citizens, with the filing late this week at the Fayette County Clerk’s Office of a civil plenary complaint against both the Fayette County Commissioners and NextEra Energy Resources, the energy company behind the Whitewater Wind Farm project.
The project, slated to span Fayette, Henry and Rush counties and begin construction this year, would see approximately 43 wind turbines place in Fayette County, specifically in Posey and Fairview townships.
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.”
NextEra, at that meeting, agreed to the addendum by the county to the decommissioning contract, which better detailed that subject. The addendum states that Whitewater Wind LLC would provide a security bond for the duration of the wind farm project to pay for decommissioning, with the amount of that security bond to be looked at after an initial eight-year period and then reevaluated every five years after for the life of the project.
Wording in the addendum, however, raised questions again in September 2015 from former Fayette County Commissioner Doug Howard as to whether the county was sufficiently protected from any costs of decommissioning.
“According to the ordinance and according to the motion that was made granting the (BZA) approval, it stated that the bonding period will cover the entire lifespan of each WECS unit,” Howard said at that time. “If you read the addendum Whitewater Wind LLC provided, it says in the opening line that it’s for a term of eight years. That is not the life of the project.”
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.
Per the addendum, it states that Whitewater Wind LLC will have a security bond for an initial term of eight years, with “each five years thereafter for the duration of the operation of the Wind Farm, the Company shall deliver to the County not later than 120 days prior to the expiration date of any posted Restoration Fund, a certificate of continuation extending the expiration date of the then-existing Restoration Fund for an additional period of five years.”
Those certificates, according to the addendum, will also include updated estimates of the net removal cost of the wind turbines to be prepared by an independent engineer. Those estimates will be used in determining the amount of the security bond for NextEra.
The complaint filed by Snyder, however, alleges the addendum still does not adhere to county zoning ordinances.
“The Fayette County Decommissioning Agreement and the Addendum to Fayette County Decommissioning agreement ... fail to conform to the provisions of the Fayette County Zoning Ordinance, in particular, Section 153.24(F)(66)(XI) in the following manner,” the complaint reads. “A. A conforming Decommissioning Plan was not submitted at the time of filing of the Special Exception Application; B. The Decommissioning Plan submitted at the time of the filing of the Special Exception Application failed to include a contractor cost estimate for demolition and removal of the WECS facility; C. The Decommissioning Plan failed to provide financial assurance at least equal to the demolition and removal contractor cost estimate that will continue for the project life of the WECS facility.”
The complaint goes on to state that the decision by county commissioners to approve the original decommissioning plan – without the addendum – was “arbitrary and capricious” because they had insufficient information at that time, due to the “failure of Whitewater Wind LLC to timely file the required contractor cost estimate and financial assurance concurrently with the Special Exception Application or prior to approval of the Decommissioning Plan” by commissioners.
The complaint seeks a declaratory judgment by the Fayette Circuit Court that both the Decommissioning Plan and its addendum between the county and NextEra Energy Resources be declared invalid and void, for failing to comply with the county’s zoning ordinance. It also seeks “costs of this action” and other relief.
Fayette County Commissioner Frank Jackson, when contacted Friday by the News-Examiner seeking comment on the complaint, said it was the first he had heard of it. He had no further comment on the matter at that time.
Efforts by the News-Examiner seeking comment on the complaint from Whitewater Wind Farm project manager Jeremy Ferrell were unsuccessful.