Contract Extension Could Leave Landowners Flapping in the Breeze

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Crit­ics say a pro­posed leg­isla­tive fix vio­lates the spir­it of the law against spe­cial leg­is­la­tion for cor­po­ra­tions and under­cuts options for landown­ers who may rethink their involve­ment with wind devel­op­ers.

The con­tro­ver­sy focus­es on the 82-megawatt Black Oak wind farm — on the draw­ing board in Stearns Coun­ty since 2008. State law requires that wind ener­gy projects be oper­a­tional with­in sev­en years. If not, landown­ers with the sev­en-year itch can rene­go­ti­ate or recon­sid­er their options. The mea­sure pro­tects prop­er­ty own­ers against spec­u­la­tors that could tie up siz­able tracts with­out fol­low­ing through on con­struc­tion.

Geron­i­mo Ener­gy con­cedes Black Oak will not be up and run­ning by the time some landown­ers’ sev­en-year leas­es expire, poten­tial­ly putting the futures of 41 tur­bine wind farms on the line. The devel­op­er wants leg­is­la­tors to extend those expir­ing con­tracts one year, allow­ing time to com­plete con­struc­tion on Black Oak.

We have a project in the mid­dle of con­struc­tion, and the leg­is­la­tion right now says it has to be in oper­a­tion at the end of sev­en years. So we thought just a one year exten­sion would help the sit­u­a­tion for this par­tic­u­lar project,” Bet­sy Engelk­ing, vice pres­i­dent of Geron­i­mo Wind Ener­gy, said at a Sen­ate Envi­ron­ment and Ener­gy Com­mit­tee hear­ing in March.

Wind pow­er skep­tics say the pro­pos­al cross­es the line, remov­ing one of the few pro­tec­tions for landown­ers involved in renew­able ener­gy devel­op­ments. Geron­i­mo Ener­gy did not respond to Watch­dog Min­neso­ta Bureau requests for com­ment.

There’s no rea­son for them to go to the Leg­is­la­ture. It’s absolute­ly no busi­ness of the Leg­is­la­ture, inter­ven­ing on behalf of a wind com­pa­ny in a pri­vate con­tract with their land­hold­ers, and that’s what this is,” said Kristi Rosen­quist, a cit­i­zen watch­dog who mon­i­tors renew­able ener­gy pol­i­cy.

Just the same, pro­po­nents recent­ly insert­ed a 76-word amend­ment in the 2015 Sen­ate Omnibus Ener­gy bill that re-ups landown­ers’ leas­es. Tech­ni­cal­ly, the amend­ment doesn’t name the project, but the author, Sen. Bill Weber, R-Luverne, removed any remain­ing doubts, stip­u­lat­ing Black Oak as the facil­i­ty behind his legislation’s art­ful word­smithing.

The project is in its ear­ly stages of con­struc­tion. How­ev­er, it will not be com­plet­ed by the time the sev­en-year peri­od expires,” Weber said in the hear­ing. “The pur­pose of this amend­ment is to there­by extend that sev­en-year peri­od by one year to an eight-year peri­od. The amend­ment is very spe­cif­ic as to the descrip­tion of the project and it is this project.”

The Min­neso­ta Con­sti­tu­tion pro­hibits the pas­sage of spe­cial leg­is­la­tion “grant­i­ng to any pri­vate cor­po­ra­tion, asso­ci­a­tion, or indi­vid­ual any spe­cial or exclu­sive priv­i­lege, immu­ni­ty or fran­chise.”

Min­neso­ta courts have cit­ed this part of the state con­sti­tu­tion to give Min­nesotans greater equal pro­tec­tion rights than the fed­er­al con­sti­tu­tion pro­vides. This pro­hi­bi­tion is square­ly aimed at pro­tect­ing peo­ple like the landown­ers in this case from being abused by unfair leg­is­la­tion that specif­i­cal­ly tips state law in favor of some­one else,” said Peter Nel­son, Direc­tor of Pub­lic Pol­i­cy for the Cen­ter of the Amer­i­can Exper­i­ment.

Black Oak has reached out to prop­er­ty own­ers.

EPA Photo POWER TO THE DEVELOPER: Geronimo Energy told MN state senators the Black Oak wind farm fell behind schedule due to issues in connecting to the grid, necessitating another year on their deals with landowners.

EPA Pho­to
POWER TO THE DEVELOPER: Geron­i­mo Ener­gy told MN state sen­a­tors the Black Oak wind farm fell behind sched­ule due to issues in con­nect­ing to the grid, neces­si­tat­ing anoth­er year on their deals with landowners.wind

We’ve con­tact­ed all of our landown­ers about this sit­u­a­tion. We are actu­al­ly work­ing with them to effec­tu­ate a new lease that would allow us to have this exten­sion,” tes­ti­fied Bet­sy Engelk­ing, Vice Pres­i­dent of Geron­i­mo Wind Ener­gy. “…The project actu­al­ly began con­struc­tion at the end of 2014 (and) with the project actu­al­ly reach­ing some pret­ty exten­sive con­struc­tion this sum­mer, we also felt that this leg­is­la­tion would be anoth­er option.”

No state sen­a­tor voiced objec­tions to the amend­ment. The pro­vi­sion was adopt­ed as part of the Sen­ate Omnibus Ener­gy bill that will be nego­ti­at­ed with the House com­pan­ion bill lat­er in the 2015 ses­sion.

This is a real­ly poor way to do pol­i­cy,” said Car­ol Over­land, an attor­ney who has rep­re­sent­ed res­i­dents opposed to Black Oak. “… It’s craft­ed in such a way that they don’t name it. There­fore, they would say it’s not spe­cial leg­is­la­tion. But it is designed only for this project.”