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UPC finds green energy initiatives face headwind

UPC plans for turbines on Mars Hill, southwest of Caribou in northern Maine, have received broad support from residents and politicians. But UPC has hit organized opposition in the other two northern New England states. Two-thirds of residents in tiny Lyman, N.H., petitioned town authorities to stop UPC from erecting a test tower on a ridge west of Mount Washington. And UPC last month underwent a week-long interrogation in Sheffield, Vt.

As James Gordon creeps closer to fulfilling his vision of a windmill power farm off Cape Cod, his erstwhile partner, Brian Caffyn, still faces headwinds in his efforts to plant turbines on Hardscrabble Mountain in Vermont and other peaks and plains across the country.

Gordon's Cape Wind Associates Inc. proposal for turbines in Nantucket Sound is the most important wind development project in the United States, experts say.

But in many ways the experience of Caffyn's UPC Wind Management LLC more accurately reflects the experience of wind-power developers in this country, where tax credits intended to promote wind energy have appeared and died away multiple times in recent years, threatening project financing and turbine component production.

UPC is pursuing no fewer than a half-dozen wind projects across the country. This month, it received a hearty aloha in Hawaii, completing financing for the $65 million Kaheawa Pastures project on Maui's southern slopes, providing an important alternate source of energy for the state with the highest electricity rates in the country.

Across the country, UPC plans for turbines on Mars Hill, southwest of Caribou in northern Maine, have received broad support... more [truncated due to possible copyright]  

As James Gordon creeps closer to fulfilling his vision of a windmill power farm off Cape Cod, his erstwhile partner, Brian Caffyn, still faces headwinds in his efforts to plant turbines on Hardscrabble Mountain in Vermont and other peaks and plains across the country.

Gordon's Cape Wind Associates Inc. proposal for turbines in Nantucket Sound is the most important wind development project in the United States, experts say.

But in many ways the experience of Caffyn's UPC Wind Management LLC more accurately reflects the experience of wind-power developers in this country, where tax credits intended to promote wind energy have appeared and died away multiple times in recent years, threatening project financing and turbine component production.

UPC is pursuing no fewer than a half-dozen wind projects across the country. This month, it received a hearty aloha in Hawaii, completing financing for the $65 million Kaheawa Pastures project on Maui's southern slopes, providing an important alternate source of energy for the state with the highest electricity rates in the country.

Across the country, UPC plans for turbines on Mars Hill, southwest of Caribou in northern Maine, have received broad support from residents and politicians. But UPC has hit organized opposition in the other two northern New England states. Two-thirds of residents in tiny Lyman, N.H., petitioned town authorities to stop UPC from erecting a test tower on a ridge west of Mount Washington. And UPC last month underwent a week-long interrogation in Sheffield, Vt., 20 miles northeast of Montpelier, over its goal to create a wind farm on Hardscrabble Mountain, one of six such projects on the books.

A newspaper's headline succinctly summed up many residents' fears: "Will Vermont become the Pinwheel State?"

Even should UPC convert Vermonters, completing the project in the time frame it envisions could be troublesome. That's because Congress, on multiple occasions, has allowed a law authorizing tax credits for wind-power investors to expire, and that has created confusion in the marketplace. The law lapsed between January and October 2004, Winer said, making it difficult for developers to win commitments from financiers; when the law was reauthorized in October, turbine manufacturers such as General Electric Co. could not keep up with the resulting demand explosion. UPC may have to stand in line for equipment.

Caffyn, a Babson College graduate, is unaccustomed to wind projects getting mired in the doldrums. He founded UPC Group in Europe several years ago, and in 2000 a subsidiary completed what then was one of the world's largest wind plants, a 170 megawatt plant near Naples, Italy, that cost $260 million. It then put together a $325 million syndicate for more windmills in Italy.

UPC did not make Caffyn available for an interview. Co-founder and general counsel Peter Gish said UPC saw the United States as a good opportunity, and ran into Gordon while scouting opportunities in Nantucket Sound. According to news reports at the time, Cape Wind was initially launched as a joint venture between Cape Wind predecessor Energy Management Inc., owned by Gordon, and Caffyn's Wind Management, which later prefixed UPC to its name.

Gish said UPC quickly saw the environmental hurdles and political opposition to the project, but declined to say whether UPC maintained its 50 percent investment in Cape Wind. Gordon did not answer a request for comment placed through a spokesman.

"We thought we were getting into a marathon," Gish said. "What it is, is an ultramarathon, and we did not sign up for that."

"It is not at all abnormal to have people buying into and selling out of these projects," said Jonathan Winer, a wind-energy consultant with La Capra Associates in Boston.

UPC moved its office from Yarmouth on Cape Cod to Newton in 2001, and began exploring other projects. Its experience since then has largely mirrored those of similar companies, from giants like Florida-based FPL Group Inc. to individual developers.

 


Source: https://www.bizjournals.com...

APR 18 2005
http://www.windaction.org/posts/51415-upc-finds-green-energy-initiatives-face-headwind
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