June 4, 2006
Cohocton Planning Board
Attn: Chairman Sandor Fox
15 South Main Street
Cohocton, NY 14828
Re: Proposed Wind Turbine Zoning Law
Dear Planning Board Members:
I was at your June 1st regular meeting and am very pleased that you have considered the seriousness of the impact of approving the proposed wind turbine zoning law in its present form. I commend your recognition of the fact that the proposed new wind turbine zoning law is incomplete due to the fact that it does not address some very important issues. It was interesting to watch as you worked your way through some of the issues and reached the logical conclusion that you could not conscientiously return the proposed law to the Town Board with your approval or recommendations without seeking answers to the questions that arose during your discussions.
I am in hopes that now that you acknowledge the complexity of the issues facing you that you will give sufficient time to finding your answers and not allow yourselves to be rushed by the pressures from the wind company and/or the Town Board. You are the Lead Agency in this program and all responsibility lies with you to perform at the level your oath of office demands. I am hoping you will consider that the entire Town is depending on you to protect us. I am in hopes that the same logic you used in deciding not to return this proposed zoning law to the Town Board with your approval will also lead you to fully understand the need for a moratorium.
I hope you have all read the account of the same type of situation that the Town of Lincoln, Wisconsin faced after they allowed a wind company to intrude into their Town without sufficient regulation in place. You can find this report at http://www.aweo.org/windlincoln.html if you have not seen it.
The following points are of great concern to me and I am giving you notice of them:
Liability:
1. Without question, it has been proven that at the installation of wind farms, surrounding residents have suffered loss in property value. The current proposed law makes no provision to protect residents from this undeniable event. This is a liability to the Town.
2. The proposed zoning law makes no provision to measure current replacement and market value of homes surrounding these turbines prior to their installation and provides no program to measure any loss of value after installation, nor does it provide any provisions to hold the wind company liable for any loss. Who will pay for these measurements of pre and post values? This is a liability to the Town.
3. The proposed Zoning law makes no provision for residents that will be damaged from the installation of these turbines to seek restitution. This issue is unaddressed and therefore leaves the burden on the resident to pursue recovery through expensive lawsuits in the Court system. It is the burden of you, the Lead Agency in this program to make responsible provision for easy and quick recovery of loss for your residents that depend on your leadership. This is a liability to the Town.
4. Let it be noted that if the wind company goes into bankruptcy, any premiums on liability insurance may not be paid leaving residents unprotected. In a bankruptcy situation, previous letters of credit are worthless. This is a liability to the Town. The only logical and acceptable solution to this issue is for the zoning law to require sufficient prepaid escrow funds to protect the Town and its residents. You cannot have sufficient protection until you have sufficiently researched the impact. How much protection or escrow funds are needed?
5. Other installations of wind farms have forced the evacuation of resident’s homes. Who pays for all this? Are you going to allow this wind company to come into our Town and profit millions of dollars per year by leveraging our wind resource and leave your residents exposed to this type of loss? Are you aware of the income that UPC is able to make from this project when you consider the sale of the electricity, the government subsidies, and the tax shelter savings from accelerated depreciation? Please see the report noted below [1] on income potential. UPC must be held responsible for the potential damage we may suffer and you must get the protection up front in cash to protect us. The report below of potential income clearly shows that they can afford to be responsible.
6. The proposed zoning law does not address any measurement of low frequency noise which is measured on a different scale than audible noise. Low frequency noise is a proven undeniable liability. The proposed zoning law does not specify who is to do this measurement nor who is to pay for it. This is a liability to the Town.
7. The proposed zoning law does not address when and for how long monitoring tests should be done to measure audible and low frequency noise.
8. The proposed zoning law does not address who will pay for the alterations, improvements and repair of Town roads prior to, during and after the installation of these turbines. Will the Town have to borrow money to accomplish these changes while you wait for reimbursement from the wind company? Will you have to raise our taxes for this? Are you allowing the Town to be put in a position of financing the wind company’s ability to leverage our wind resource? What cash flow impact (has a study been done?) will the cost of these road alterations have on the Town if we have to pay for them up front? This is a liability to the Town.
9. What is the measured impact of all these road expansions? Will the affected property owners that lose usable property from the expansion of these roads suffer loss? This is a liability to the Town.
10. What is the process for recovery when a resident has been damaged? Will residents have direct and immediate access to an escrow fund for such losses or will they be forced to wait and finance any needed responses out of their own pocket? What if a neighboring farmer cannot plant a damaged field from runoffs and erosion resulting from the installation of these turbines? Who will pay his loss? How long will he have to wait for reimbursement?
11. What if people are forced out of their home which is always the case when a wind farm is implemented in a populated area such as ours? How will struggling young families handle the financial burden of moving their families when they cannot get full market value from their current home because you allowed a 400’ wind turbine to be stuck right behind it? Shouldn’t there be an escrow fund set up to cover replacement costs of homes and all moving and relocation expenses? How can these financially struggling families afford to fight a wind company that turns a deaf ear to their cry?
12. What on earth are you thinking when you are allowing a 500’ foot height restriction? How long do you think it will be before the wind company utilizes that option?
The following [1] is an extract from the work of Glen Schleede in which he examines the income streams for these wind companies. The analysis is based on 67 of the old style, less productive 1.5 MW turbines which are smaller and less in number than what UPC wants to put into out Town. One could logically conclude that UPC will be in line to receive much more financial benefit than proposed in the analysis below.
[1] Total Profit: Assuming 30% turbine efficiency, the first year profit for a 100 megawatt (67 turbine, 1.5 MW) project comes to, at a minimum, 18.7 million (from electricity sales + Federal Production Tax Credit + NYSERDA credit) + $8.7 million in tax savings = 27.4 million in year 1, the net cash flow goes up substantially in year 2, goes back to approx. 26.4 million in year 3, and drops down about half in years 4 and 5. The depreciation schedule is one of the incentives granted by the federal and state governments. (Note-each company which takes over an existing windplant gets to take advantage of the same depreciation schedule as the original company. There is an obvious incentive to sell the wind project after 3 years of operation. See reference [2] below.
You are the Lead Agency in this program and directly accountable for all the answers to these questions and the successful management of this program. I completely understand the position you are in. I understand the pressure on you from above to rubber stamp this zoning law as it is, but please, for the sake of the residents who trust you to protect them, for the sake of your honor, for the sake of your conscience, do not cave into the pressure from above. You are the Lead Agent, tell those above you that are pressuring you to be puppets and disregard the oath of your office to back away, they have to obey you, you have the authority. You are the Lead Agency, use your authority to do what your oath of office demands … protect us residents.
I urge you to declare a moratorium for yourselves giving time to research and make responsible decisions. Irresponsible decisions will only expose the Town to future liability from lawsuits for negligence. You will have to face us residents after these turbines are up. What will you tell us when we see you in the store? Will you have to hang your head in shame because you crumbled under the pressure of the Town Board? Please lead properly.
I have only scratched the surface of the questions that lie before you with my points above.
Sincerely,
Robert C. Strasburg II
[2] The author of the above analysis, GLENN R. SCHLEEDE is semi-retired after working on energy and related matters in government and the private sector for over 30 years. He now devotes a large share of his time to self-financed analysis and writing about (a) government policies and programs that are detrimental to consumers and taxpayers, and (b) government or private sector activities that are presented to the media, public and government officials in a false or misleading way. From 1992 until September 2003, Schleede maintained a consulting practice, Energy Market and Policy Analysis, Inc. (EMPA), providing analysis of energy markets and policies. During that time he worked primarily on natural gas and electricity issues. Prior to forming EMPA, Schleede was Vice President of New England Electric System (NEES), Westborough, MA, and President of its fuels subsidiary, New England Energy Incorporated. His time with NEES included responsibilities for procurement and transportation of coal, natural gas and oil for NEES facilities, NEEI’s oil and gas exploration and coal shipping ventures, and NEES economic planning and budgeting functions. Previously, Schleede was Executive Associate Director of the U.S. Office of Management and Budget (1981), Senior VP of the National Coal Association in Washington (where he was employed from 1977-1981) and Associate Director (Energy and Science) of the White House Domestic Council (where he served from 1973-1977). He also held career service positions in the U.S. OMB and the U.S. Atomic Energy Commission. He has a BA degree from Gustavus Adolphus College and an MA from the University of Minnesota. He is also a graduate of Harvard Business School’s Advanced Management Program. Schleede is the author of many papers and reports on energy matters. His articles appear in various journals and/or are covered in the energy trade press. Some appear in full text on various public policy group web sites. Since 2001, Schleede has analyzed and written a lot about wind energy. The facts (a) convinced him that wind turbines are a niche technology that would never make a significant contribution toward meeting US energy requirements, and (b) demonstrated that the US DOE’s Office of Energy Efficiency & Renewable Energy (DOE-EERE); the National Renewable Energy “Laboratory” (NREL) and other DOE contractors, using tax dollars, distribute false and misleading information on wind energy.
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