After legal challenge, Maine utility regulators again OK $333 million partnership between Emera, First Wind

The Maine Public Utilities Commission voted 2-1 Tuesday to allow Emera Maine’s parent company to invest $333 million through a joint venture with wind farm developer First Wind, a deal that was sent back to the commission for further review after a Maine Supreme Judicial Court decision.

Deliberations in the case Tuesday centered on whether the financial relationship would create favoritism of any kind between the power-generating entity and the Maine transmission and distribution utility Emera Maine, which is owned by Nova Scotia-based Emera Inc.

“To use an familial analogy, this would be a second-cousin corporation and First Wind would be the spouse,” said PUC Commissioner David Littell during deliberations Tuesday.

That partnership first approved in 2012 involves Emera Inc. subsidiary Northeast Wind taking a 49 percent stake in the company JV Holdco, which would have ownership of certain First Wind projects. The Ontario-based Algonquin Power & Utilities Corp. would also have a stake in those projects.

The renewed approval stands to bolster First Wind’s financing for projects in the state. As an indication of concern over the impact the court’s ruling would have on First Wind’s projects, the Maine Department of Environmental Protection asked the company to again file documentation proving it had access to money required for developing, maintaining and decommissioning its projects.

Opponents of the partnership wrote in briefs filed with the PUC that a partnership between an Emera entity and First Wind would violate Maine’s deregulation of the power industry in 2000, which generally prohibits transmission and distribution utilities like Emera Maine from owning electricity generation resources.

Commissioner Mark Vannoy, the lone dissenting vote of the three commissioners, argued that the conditions of the measure serve to mitigate the risk of favoritism among the utility and power generator, but that those conditions do not eliminate the influence of the financial interest and thereby violates the test the court laid out.

“It’s a very difficult enterprise for a regulatory body to build in an incentive and acknowledge it exists and then dampen it with conditions,” Vannoy said. “The simple conclusion is that a financial incentive exists to favor a certain generator.”

Vannoy said it is not the PUC’s task to evaluate whether such favoritism would occur but whether the structure of the deal creates a prohibited interest.

The court decision ordered the PUC to determine when a financial relationship is sufficient to give a transportation and distribution company an incentive to favor one power generator over another.

The company expressed confidence to the DEP that the $333 million investment from Emera would move ahead to support part of its projects in Oakfield, Hancock and Bingham.

That funding would in turn become a part of the financing for First Wind’s projects in Oakfield, Hancock, Bingham and perhaps others.

Emera and First Wind were cautious about declaring the vote Tuesday as a victory. Representatives from both companies said it’s premature to comment on the decision until they have the PUC’s order in writing. That order will include other conditions that aim to mitigate any influence the investment would have over Emera or Emera Maine’s transmission and distribution planning.

A spokeswoman for Emera and spokesman for First Wind both said in emails that the result of deliberations Tuesday were “very encouraging.”

Tom Welch, chairman of the commission, cast the deciding vote. That breakdown mirrors some past commission votes on wind energy proposals, with Littell generally in support and Vannoy opposing.

Source

Wind turbine fire risk: Number that catch alight each year is ten times higher than the industry admits

Fire has a huge financial impact on the industry, the researchers report in the journal Fire Safety Science.

Each wind turbine costs more than £2 million and generates an estimated income of more than £500,000 per year.

Any loss or downtime of these valuable assets makes the industry less viable and productive.

Dr Guillermo Rein of Imperial’s department of mechanical engineering, said: ‘Fires are a problem for the industry, impacting on energy production, economic output and emitting toxic fumes.

‘This could cast a shadow over the industry’s green credentials.

‘Worryingly our report shows that fire may be a bigger problem than what is currently reported. Our research outlines a number of strategies that can be adopted by the industry to make these turbines safer and more fire resistant in the future.’

Wind turbines catch fire because highly flammable materials such as hydraulic oil and plastics are in close proximity to machinery and electrical wires.

These can ignite a fire if they overheat or are faulty. Lots of oxygen, in the form of high winds, can quickly fan a fire inside a turbine, the paper found.

It contradicts the findings of a report into the wind industry, commissioned by the Health and Safety Executive in 2013, which concluded that the safety risks associated with wind turbines are very low.

The wind industry last night questioned the validity of the new research.

Chris Streatfeild, of Renewable UK which represents wind firms, said: ‘The industry would challenge a number of the assumptions made in the report, including the questionable reliability of the data sources and a failure to understand the safety and integrity standards for fire safety that are standard practice in any large wind turbine.

‘Wind turbines are designed to international standards to meet mandatory health and safety standards including fire safety risks.

‘The industry remains committed to promoting a safe environment for its workers and the public, and no member of the public has ever been injured by a wind turbine in the UK.’

Source