Could a BigWind lease put your family at risk for a lawsuit?

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Since BigWind slithers into an area, before it is announced to the public, you should educate your neighbors, now, about the risks of signing BigWind leases. Could you/they be at risk for future lawsuits? Maybe. We have blogged about this scenario in Indiana, once before. Will it become more common? Would it cause stress to the property owners? Absolutely! Leases should be scrutinized by a professional with experience…..

Receipt of a mechanic’s lien against their property in the amount of $68,995.75 has caused some property owners in Arkwright a fair amount of confusion and, at least initially, a significant amount of stress.

On March 15, Harter Secrest & Emery LLP, the law firm representing Specialties Company, LLC of Indianapolis, Indiana, filed mechanic’s liens against real properties in Arkwright under lease agreements with wind company EDP Renewables. According to lien documents, Akrwight Summit Wind Farm, with consent from the property owners, engaged the services of subcontractor White Construction, Inc., also of Indiana.

White Construction “was engaged to furnish labor and materials for earthwork, excavation and backfill of soil, and soil stabilization and modification, for the improvement of the Premises.”

Although the work has been completed, the mechanic’s lien says that White Construction has not been paid in full. “The total agreed price and value of labor and materials furnished under contract with White Construction, Inc., 3900 East White Avenue, Clinton, IN 47842 was $6,109,037.28 of which $3,548,568.30 remains unpaid and the total amount allocable to the Premises and which this lien filed is $68,995.75.”...

After speaking with the wind company, Norton contacted the OBSERVER by phone later on Wednesday. “I spoke to one of the vice presidents of EDPR. It’s a dispute between contractors, but beyond that they couldn’t talk about it. They are aware of the situation. It’s a legal matter,” Norton said.

In recent years, mechanic’s liens have been filed against other property owners with wind company lease agreements. In a similar 2016 case, AUI Construction Group v. Louis J. Vaessen, a subcontractor on the wind project, AUI, was responsible for the construction of the foundation and the tower on Vaessen’s property. In AUI’s subcontractor’s agreement, wind company GSG 7 was listed as the owner for the wind turbine. At the end of the project, AUI claimed it was owed $5.9 million from another subcontractor involved. AUI received partial payment, but was owed a remaining balance of $3.18 million. Although AUI received a partial award to settle the dispute, the subcontractor soon filed bankruptcy, leaving approximately $1 million unpaid. AUI attempted to collect the unpaid amount from the Vaessens in the form of a mechanic’s lien.

In a landmark decision, the Illinois appellate court ruled in favor of the property owners, whose lease agreement allowed an easement for a structure on their property. Further, the court determined that the property owners did not receive a direct benefit from the turbine — only from the lease money ($7,500 annually) from the wind company. Because the wind turbine was the property of the wind company, who directly benefitted from the energy generated by the turbine, they were held responsible for the amount of money owed to AUI.

Although the court ruled in favor of the landowners, the case raises serious questions regarding the lien rights of subcontractors and property owners’ liability. Many contractors, subcontractors and suppliers are engaged in order to create just one wind farm, which can leave several opportunities for payment problems or disputes. What protections do subcontractors have when the property owner is not the one benefitting from the project? Who becomes responsible for monies owed if a party involved in a wind project files for bankruptcy? While answers to these questions may differ based on the specific terms of property owners’ lease agreements, the case is a reminder for all parties involved to read — and understand — the fine print….

 

Arkwright article

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Ohio BigWind NOT working x years?

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Say it isn’t so! How can this be? Read through this nightmare for a small Ohio community and you will see that a 2nd turbine has also not produced what was expected (promised) by BigWind. Lawsuits are pending.  How many of you live in a community that is flush with cash to be able to afford these lawsuits?? This news is devastating for the local community and our taxpayers. Lawsuits are expensive. Don’t let this happen to you…Have you contacted your legislators and told them how you feel about BigWind invading your community?….

The city of Conneaut has prepared a complaint to be filed in Ashtabula County Common Pleas Court aimed at a long-damaged wind turbine at the city’s lakefront…

The city names three defendants in the complaint: Conneaut City Wind LLC, in care of statutory agent CT Corporation System of New York City; NexGen Energy Partners LLC of Boulder, Colorado; and NexGen’s statutory agent, Matthew O’Conneaut, of Cleveland…

In the complaint, the city alleges the defendants have not made repairs to the turbine, which has been idle since February 2017, when a lightning strike blew off one of three blades and damaged the machine’s internal workings…

The 400-kilowatt turbine was the result of a January 2010 contract between the city and CCW to provide electric power to the sewage plant. The turbine, erected a short time later, provided about 20 percent of the electricity used at the plant. Direct Energy, the primary power supplier, is filling the void, officials have said.

Last year, NexGen told the city it wanted to stretch the contract to 2030 to help it recoup the estimated $250,000 repair cost, officials said at that time. The contract included slight kilowatt-per-hour increases into the contract years, administrators said.

In 2016, the last full year of the turbine’s operation, NexGen charged the city $59,000 for the electricity it produced. The city is charged only when the turbine is producing power, officials have said…

“(Defendants) Conneaut City Wind and NexGen have refused to repair, remove or otherwise restore the ability to of the turbine to generate electricity,” according to the lawsuit…

A larger turbine at Conneaut Middle School, erected by NexGen at about the same time in 2010, never performed as expected. NexGen filed a lawsuit against a parts manufacturers that is still working through the courts…

original article link

 

Rural Greenwich, Ohio, taking BigWind to the supreme court

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“according to Ohio law, before the Ohio Power Siting Board can issue a certificate for a windfarm, the board must be able to show the proposed windfarm will comply with various requirements related to flicker, sound and ice throw. The board was supposed to have developed rules related to those requirements by 2008. The board “never issued those rules“…Setbacks exist for a reason and that is safety. Few people know that the NW Ohio wind site in Paulding county experienced a blade shear. How far away was a piece found? More than 900 feet away!! How does the OPSB stay in business??…….

A rural Greenwich group’s fight to keep wind turbines out of their neighborhood is headed to the Ohio Supreme Court.

A state board on Thursday gave Windlab USA, a wind turbine developer, the go-ahead to construct 25 turbines in rural Greenwich, rejecting a request for a rehearing by a couple who lives by the future development.

The project will comprise 4,600 acres and up to 25 turbines, each 490.5 feet tall with rotor diameters of up to 383 feet….

 

A point of contention is whether Monica Jensen, Windlab USA’s vice president of development, has secured the necessary signatures from all adjacent property owners to bypass the minimum setback requirements.

Jensen on Thursday said she has “15 waivers” from residents whose property violates those setbacks.

But Sam Randazzo, an attorney for the Greenwich Neighbors United, a group opposed to the wind turbines, said of the 25 proposed turbines, 62 percent violate the minimum setback requirements. He added that amounts to “at least 100 property owners.”

“The only way the construction can proceed is if (Windlab) obtains waivers from all adjacent property owners,” Randazzo said.

The attorney said if you draw a circle based on a one-mile radius from the center of the proposed windfarm, there are more than 900 residences, in addition to “many active farms” as well as recreational and hunting businesses.

“That is why there has been such strong opposition,” he said.

“There’s no way that they have secured waivers from all of those property owners,” Randazzo said. He added that the ruling handed down by the siting board Thursday stipulates that Windlab must have those signatures before starting to construct a turbine.

“At the end of the day, they can’t construct anything unless they secure a waiver from the adjacent property owners,” he said. “That would be against the board’s order.”

Schilling confirmed the ruling requires the signatures.

The attorney was asked about the 15 waivers Jensen said she’s obtained….

The lawyer also said according to Ohio law, before the Ohio Power Siting Board can issue a certificate for a windfarm, the board must be able to show the proposed windfarm will comply with various requirements related to flicker, sound and ice throw.

The board was supposed to have developed rules related to those requirements by 2008. The board “never issued those rules,” Randazzo said. He added, therefore, the board issued Windlab USA a certificate to construct before the developer can demonstrate they can satisfy those requirements.

Opponents have also raised concerns about noise, adverse health effects and impact to wildlife….

Source: Winds in rural Greenwich are blowing toward Columbus … specifically the Ohio Supreme Court

Everpower has their hands full with Ohio lawsuits

In Champaign County, the Urbana Daily Citizen reports that the County and Township governments did not file requests for rehearing of the OPSB’s decision to grant Everpower’s certificate extension. Presumably, these governments have their hands full with their two other active lawsuits. Additionally, below this discussion is an enticing offer from Everpower for some of their leaseholders.  If they provide a 1-time payout to the leaseholder, it will cost them less over the lifetime of the project. Everpower is seeking a bank that might assist them in this initiative. Is this a new strategy to attract leaseholders?….

Citizens group Union Neighbors United UNU filed an application for rehearing Wednesday against an Ohio Power Siting Board OPSB decision in the Buckeye Wind project….

In the application for rehearing, UNU contends that the board’s decision is unlawful and unreasonable for multiple reasons including the extension amends an express term of the original certificate issued to the project applicant without complying with legally-mandated procedure for certificate amendments, the board lacking legal authority to waive or alter procedures applicable to the amendment of certificate and because the project developer has not shown good cause to extend the certificate by motion or otherwise.

UNU questions why EverPower has been unable to begin a continuous course of construction within the original five-year term of the certificate and contends that the developer has shown no evidence to demonstrate that litigation prevented this.

The intervenors also argue that the extension request is a response to new state laws….

via Wind intervenors file application for rehearing – Urbana Citizen – urbanacitizen.com.

From EverPower Newsletter Vol. 3 Issue 2

 Annual Landowner Payment Buyout – Is it right for you?

Everpower has had a number of landowners express an interest in receiving a one-time up-front payment in place of their annual royalty checks. Due to the number of requests we have received, and in an effort to be accommodating to those who have supported our projects, Everpower is currently considering such an arrangement.

In order to assess the present value of future annual payments, Everpower will need to appraise each project’s future performance, which will include forecasts of energy production, power prices, renewable energy credit prices, wind turbine reliability, and take a view on state and federal renewable energy policies over the life of the project. Everpower will likely team up with a lender to make one-time payments, which will also carry with them and interest rate cost. Due to these factor, the calculation of  the amount of money that Everpower could pay for each one-time payment has some complexity to it….

We understand that the one-time payment may not be the right option for everyone, but it may have advantages for some who would rather not wait until the end of the life of a project to recover value from their annual payments….