Representative of fledgling N.J. investment group meets town supervisor, one landowner
HENDERSON — A fledgling investment group is eyeing the town as a location for a wind power project.
Ronald J. Scrudato has talked to town Supervisor Clyde E. Moore and one landowner. He represents an investment firm so young, it's name isn't set yet. But so far, it's called Delfea and it is based in New Jersey.
"It's really very premature," Mr. Scrudato said. "It's looking to invest in wind energy development."
Mr. Scrudato, who has a doctorate in geology, ran SUNY Oswego's Environmental Research Center and has been involved in environmental issues, such as hazardous waste site remediation, for the last 30 years.
Mr. Scrudato said he will come to Henderson to talk to landowners who are interested in both small and large wind development. Mr. Moore and Mr. Scrudato have not yet arranged a meeting time and date with the public.
Delfea is interested in leasing from landowners with at least 25 acres whose neighbors also own at least 25 acres and would be interested in development.
There are areas in Henderson with consistent wind speeds of at least 12 miles per hour at the height of turbines.
Mr. Moore said Mr. Scrudato is considering the ridge along Route 71 and Ridge Road. Mr. Moore suggested Town Barn Road.
"The wind's always blowing there," he said.
Delfea would need wind speed data collected through test towers for at least one year at potential turbine locations.
The company would offer leases of 50 to 100 years, with up to $5,000 per year per turbine for the property owner, but the compensation would depend on the productivity of the turbine.
The town has a zoning law related to wind power development. In part, the law bans wind turbines on the waterfront and allows commercial wind farms in agricultural zones. The law stipulates: "No wind turbine tower facility shall be installed in any location that would substantially detract from or block the view of a portion of a scenic viewshed, as viewed from any public road right-of-way, public body of water, or publicly owned land."
Tuesday, September 02, 2008
VIDEO of PSC Iberdrola Vote on Energy East
PSC Special Session Meeting - Iberdrola / Energy East Vote.
Watch the Video Meeting on Wednesday, September 3, 2008, 10:30 AM
http://www.dps.state.ny.us/webcast_sessions.htm
Watch the Video Meeting on Wednesday, September 3, 2008, 10:30 AM
http://www.dps.state.ny.us/webcast_sessions.htm
PSC Case 07-M-0906 Iberdrola - Energy East Merger September 1, 2008 Letter by Alice Sokolow
Dear NY PSC,
When weighing in on Iberdrola's acquisition of Energy East, please add the following new information attached to Case 07-M-09-06 especially the August 30, 2008 announcement of British gas and electric increases.
Is this the future for NY and Energy East? Who will own the transmission rights(reference 2 & 3)? Is this energy staying in NYS for the benefit of New Yorkers? Has the PSC accounted for the REC's? Higher SBC and RPS charges in our regions? Iberdrola's influence on the Eastern Coast and beyond to transmission pipelines or REC corridors?
Respectfully,
A Negatively Impacted Paying Customer who is not Blown Over by Empty Promises of Wind,
Shown me the Hard Generation Data of Maple Ridge,
Alice Sokolow
Penfield, NY (RGE, Energetix)
& Prattsburgh, NY (NYSEG)
1. August 30, 2008 Timesonline:
ScottishPower lifted its gas bills by 34 per cent, the second-largest rise after British Gas increased its prices by 35 per cent last month. It also announced that it will increase its electricity prices by 9 per cent from Monday. The company's 1.2 million customers will pay £221 more a year for gas and an extra £38 for electricity.
2. June 13, 2008
In the event that IBERDROLA RENOVABLES decides to sell its total shareholding in any of the companies from 1 January 2011, the Company has granted Gamesa EnergÃa a joint transmission right to third parties (tag along) and a first option right, subject to certain conditions.
3. May 25, 2008
Click here: Iberdrola, S.A. Abu Dhabi National Energy Company PJSC 9TAQA) to explore co-investment opportunities | TAQA
Iberdrola, S.A. Abu Dhabi National Energy Company PJSC 9TAQA) to explore co-investment opportunities.
Both companies will explore co-investment and development opportunities in the Middle East, North Africa, Europe and North America
IBERDROLA, S.A. ABU DHABI NATIONAL ENERGY COMPANY PJSC (TAQA) TO EXPLORE CO-INVESTMENT OPPORTUNITIES
Ignacio Galán, Chairman of Iberdrola, and Peter Barker-Homek, CEO of TAQA, signed an agreement today in Abu Dhabi, capital of the United Arab Emirates.
For the Iberdrola Chairman, this new agreement to collaborate in identifying energy investments around the world will benefit both companies, and specifically Iberdrola through the opportunity to grow in new markets such as North Africa and the Middle East with a partner that is already active there, as well as potential to continue building its already significant presence in Europe and North America.
When weighing in on Iberdrola's acquisition of Energy East, please add the following new information attached to Case 07-M-09-06 especially the August 30, 2008 announcement of British gas and electric increases.
Is this the future for NY and Energy East? Who will own the transmission rights(reference 2 & 3)? Is this energy staying in NYS for the benefit of New Yorkers? Has the PSC accounted for the REC's? Higher SBC and RPS charges in our regions? Iberdrola's influence on the Eastern Coast and beyond to transmission pipelines or REC corridors?
Respectfully,
A Negatively Impacted Paying Customer who is not Blown Over by Empty Promises of Wind,
Shown me the Hard Generation Data of Maple Ridge,
Alice Sokolow
Penfield, NY (RGE, Energetix)
& Prattsburgh, NY (NYSEG)
1. August 30, 2008 Timesonline:
ScottishPower lifted its gas bills by 34 per cent, the second-largest rise after British Gas increased its prices by 35 per cent last month. It also announced that it will increase its electricity prices by 9 per cent from Monday. The company's 1.2 million customers will pay £221 more a year for gas and an extra £38 for electricity.
2. June 13, 2008
In the event that IBERDROLA RENOVABLES decides to sell its total shareholding in any of the companies from 1 January 2011, the Company has granted Gamesa EnergÃa a joint transmission right to third parties (tag along) and a first option right, subject to certain conditions.
3. May 25, 2008
Click here: Iberdrola, S.A. Abu Dhabi National Energy Company PJSC 9TAQA) to explore co-investment opportunities | TAQA
Iberdrola, S.A. Abu Dhabi National Energy Company PJSC 9TAQA) to explore co-investment opportunities.
Both companies will explore co-investment and development opportunities in the Middle East, North Africa, Europe and North America
IBERDROLA, S.A. ABU DHABI NATIONAL ENERGY COMPANY PJSC (TAQA) TO EXPLORE CO-INVESTMENT OPPORTUNITIES
Ignacio Galán, Chairman of Iberdrola, and Peter Barker-Homek, CEO of TAQA, signed an agreement today in Abu Dhabi, capital of the United Arab Emirates.
For the Iberdrola Chairman, this new agreement to collaborate in identifying energy investments around the world will benefit both companies, and specifically Iberdrola through the opportunity to grow in new markets such as North Africa and the Middle East with a partner that is already active there, as well as potential to continue building its already significant presence in Europe and North America.
Noble Environmental sets shares for IPO amid investigation
The wind farm developer moves forward with its offering as the New York State Attorney General looks into the company.
Essex, Conn.-based wind power company Noble Environmental Power has set the number of shares in its planned initial public offering at 23.4 million. The updated filing comes amid an investigation into the company by the New York State Attorney General alleging improper dealings with public officials and anti-competitive practices.
The company, which operates 282 megawatts of electrical generating capacity, originally filed plans with the U.S. Securities and Exchange Commission in May to raise up to $375 million in a share sale (see Noble Environmental files for $375M share sale).
But in July, Noble Environmental and Newton, Mass.-based First Wind Holdings, formerly known as UPC Wind, were both served subpoenas by the New York State Attorney General's office. The two companies are developing and operating wind farms across New York state.
The subpoenas are part of an investigation into whether the companies sought or obtained land-use agreements with citizens and public officials, whether improper benefits were given to public officials to influence their actions, and whether they entered into anti-competitive agreements or practices.
First Wind is also heading to the public market, filing plans last month for a $450 million IPO (see First Wind plans share sale as WNDY). First Wind has not yet set the number of shares or a price for its offering.
Noble Environmental said it has and will continue to fully cooperate with the requests of the New York State Attorney General.
The company expects to list on the Nasdaq under the symbol "NEPI." It has not yet announced a price range for its IPO.
Essex, Conn.-based wind power company Noble Environmental Power has set the number of shares in its planned initial public offering at 23.4 million. The updated filing comes amid an investigation into the company by the New York State Attorney General alleging improper dealings with public officials and anti-competitive practices.
The company, which operates 282 megawatts of electrical generating capacity, originally filed plans with the U.S. Securities and Exchange Commission in May to raise up to $375 million in a share sale (see Noble Environmental files for $375M share sale).
But in July, Noble Environmental and Newton, Mass.-based First Wind Holdings, formerly known as UPC Wind, were both served subpoenas by the New York State Attorney General's office. The two companies are developing and operating wind farms across New York state.
The subpoenas are part of an investigation into whether the companies sought or obtained land-use agreements with citizens and public officials, whether improper benefits were given to public officials to influence their actions, and whether they entered into anti-competitive agreements or practices.
First Wind is also heading to the public market, filing plans last month for a $450 million IPO (see First Wind plans share sale as WNDY). First Wind has not yet set the number of shares or a price for its offering.
Noble Environmental said it has and will continue to fully cooperate with the requests of the New York State Attorney General.
The company expects to list on the Nasdaq under the symbol "NEPI." It has not yet announced a price range for its IPO.
PSC Iberdrola Energy East September 1, 2008 Letter by Glenn R. Schleede
September 1, 2008
Why are NY Political and Media Leaders Grossly Overestimating the Economic Benefits of Iberdrola’s Insistence on Investing $2 billion on Wind Farms in NY?
New York political and media leaders are grossly overestimating the favorable local and state economic benefit that would result from Iberdrola’s proposed investment of $2 billion in “wind farms” in New York.
Virtually every public comment from NY political leaders and every news story and editorial on the impending NYS Public Service Commission’s decision emphasizes that Iberdrola would invest $2 billion in “wind farms” in New York if the Spanish company is permitted by the PSC to acquire Energy East and its electric and gas distribution companies in New York, Maine, Massachusetts and Connecticut.
This heavy emphasis on the proposed $2 billion investment suggests that NY leaders do not yet understand that a $2 billion investment in “wind farms” in NY would provide have very little favorable economic in the areas where the “wind farms” would be built or in the state. The economic impacts may even be negative.
This brief paper explains that there would be little, if any, net favorable local or NY state economic impact from a potential $2 billion Iberdrola investment in NY “wind farms because:
• Potentially favorable economic impacts are typically overstated by the wind industry and its advocates within governments, and
• Other factors, often ignored, tend to offset most or all of the favorable impacts.
Overstated Economic Benefits of “Wind Farms”
1. Very little of the $2 billion “investment” would be spent locally or have local economic benefit.
This fact becomes clear when the make-up of a $2 billion investment in “wind farms” is analyzed.
Specifically, the share of total “wind farm” capital costs accounted for by the various elements of cost (i.e., turbines, blades, towers, assembly and installation, etc.) varies widely among “wind farms” depending on such factors as their size, location, terrain, distance from a transmission lines, and when turbines were purchased. (“Wind farm” capital costs have increased dramatically since 2000-2002. )
Detailed breakdowns of cost generally are not revealed by “wind farm” owners. However, a 2006 report from the National Renewable Energy Laboratory (NREL) provides rough estimates of the breakdown of total project costs based on 2000-2003 data. Undoubtedly, these costs have changed but they do permit calculating the following rough estimates of the shares of a $2 billion capital investment that would be expended for various elements of cost:
Element of Capital Cost % of total Share of $2 Billion
• Turbine, Blades & Tower 73.8% $1,476,800,000
• Foundation 3.3% 65,600,000
• Transportation 3.6% 71,300,000
• Roads, Civil Works 5.6% 112,600,000
• Assembly & Installation 2.7% 54,200,000
• Electric Interface & connection 8.7% 173,900,000
• Permits, Engineering 2.3% 45,600,000
Totals 100% $2,000,000,000
This breakdown helps identify the share of costs that might have some favorable local or state economic benefit (but note that other factors, described below, will offset the potential favorable benefits). Specifically:
a. As the above table shows, the overwhelming share of the capital cost of a “wind farm” is for turbines, blades, towers electronics, cables, etc. that are manufactured elsewhere. A majority of wind turbines being installed in the U.S. apparently are imported from other countries. Little, if any, of the money spent for the turbines, blades, towers and related components making up nearly 3/4ths of the cost would be spent in NY.
b. Foundation costs include cement and aggregate for concrete, steel rebar, and earthmoving. Aggregate and some of the workers for concrete work and operators for earth moving equipment may come from the local area or region. However, cement, rebar and earth moving equipment would originate elsewhere and may be imported.
c. Turbines, towers, and blades would be transported from ports or from manufacturing locations outside NY. Transporters probably would be located in those places, not at the “wind farm” site.
d. Roads and civil works probably would require workers and equipment from the local area or region but a significant share of the cost probably would be for the repair of existing roads that are destroyed when moving the heavy turbine and tower components over them.
e. Assembly and installation of turbines, blades, towers and related equipment generally is performed by specialists who travel to “wind farm” sites and, therefore, typically involve few local workers.
f. Electrical interface and connection costs would include cabling to collect electricity from turbines and move it to a substation, the substation itself, and transmission lines to the nearest existing transmission line that could handle the full rated output of the “wind farm.” Transmission line costs will vary widely with distance. The required equipment would not be purchased locally.
g. Permitting and licensing costs would involve owner’s project developers, as well as lawyers, consultants, government fees, and other personal service costs that would likely involve few local workers.
2. Few local jobs result from “wind farm” construction or operation. The wind industry and its advocates with governments often exaggerate the number of jobs that are likely to be filled with local workers during construction (which may take only last 6 to 9 months) and operation of the facility.
As indicated above, very few of the jobs during “wind farm” construction are filled by local workers. Instead, most jobs (often as many as 80%) are filled by specialized workers brought in from other areas. These workers often live and pay taxes elsewhere and probably go home on many weekends. Jobs that are filled locally during the construction period may include transit-mix drivers, laborers, and some heavy equipment operators. Few permanent jobs are created and many of these will be filled by technicians brought in temporarily for maintenance work.
Wind industry lobbyists typically overstate the number and economic benefit of “indirect” jobs (e.g., those in restaurants and hotels because of construction activity) because the construction activity is short lived and project workers brought in from other areas are likely to go home on many weekends and their wages are spent (and taxes paid) in their home towns.
3. Few supplies and services are procured locally and the favorable economic impact is small. Wind energy advocates often overstate the favorable local economic benefit of “wind farms” because they pretend that the full cost of anything procured locally provides a favorable economic benefit. In fact, very little money is spent locally for supplies and services and, importantly, even with these local purchases only the local value added portion (not the whole cost) may provide some local economic benefit.
4. Rental income paid to land owners may have little or no local economic benefit. “Wind farm” developers often claim that rental or lease payments to landowners who permit construction of wind turbines on their property provide a significant local economic benefit. In fact, any income received by landowners has local economic benefit only if that money is spent or saved locally. Money received by absentee landowners or that is spent or invested elsewhere doesn’t help the local economy.
Negative Economic Impacts that Offset Favorable Impacts.
In addition to the adverse environmental ecosystem impacts that are increasingly being documented (e.g., noise, impact on birds, bats, wildlife habit, and scenic impairment), “wind farms” have significant adverse economic impacts that are often ignored by the wind industry and overlooked by government officials.
1. NY and other states are likely to lose significant corporate income tax revenue. As explained in a separate paper, Energy East companies that would be acquired by Iberdrola paid about $114 million in federal and state corporate income taxes in 2007. However, because of extraordinarily large federal and state tax breaks and subsidies, companies owning “wind farms” are able to avoid paying millions of dollars in federal and state corporate income tax. Therefore, if Iberdrola is permitted to own “wind farms,” the company would almost certainly be able to avoid, for years, paying corporate income tax on the electricity and gas distribution companies obtained through its Energy East acquisition. (Note that tax burden avoided by “wind farm” owners is shifted to ordinary taxpayers who do not enjoy such tax shelters.)
2. Local governments may also lose tax revenue if Iberdrola was exempt from avoid paying property tax on “wind farms.” New York law permits exemption from property taxes for “wind farm” equipment, subject to agreement with local governments and school districts. This exemption authority has been exercised in some cases and has resulted in PILOT (payment in lieu of tax agreements) that result in some payments by “wind farm” owners to local governments and non-profit groups. Such agreements – which may be attractive to local officials now in office – are not necessarily in the long run best interests of local governments, or taxpayers who must pick up the tax burden escaped by wind farm owners.
3. Profits from the Energy East electricity and natural gas distribution companies that would be acquired by Iberdrola probably would flow out of New York and out of the US. These profits are derived from electric and gas customers in the states where Energy East companies now operate.
4. Electric customers would almost certainly experience higher monthly electric bills. Electric customers in New York are likely be affected adversely in three ways by the addition of more “wind farms”:
a. The full, true economic cost of electricity from wind is higher than electricity produced from traditional generating sources. Also, the value of electricity produced from wind is lower because it is produced only when wind speeds are within a certain range. Therefore, the electricity is intermittent, volatile, and unreliable. It is most likely to be produced at night in colder weather rather than on hot summer late afternoons in July and August when demand is highest.
b. Wind turbines cannot be counted on to produce electricity at the time of peak demand. Therefore, reliable (“dispatchable”) generating capacity – not intermittent, unreliable wind turbines – will have to be added to meet increases in peak electricity demand in NY and/or to replace existing generating capacity. Electric customers could end up paying twice; once for unreliable wind capacity and again for capacity than can be counted on to meet peak demand.
c. The subsidies paid to “wind farms” in New York by NYSERDA and paid for with money collected from electric customers via a surcharge added to their monthly bills.
5. Money is drained from local economies. New York residents are already paying some of the very highest electricity prices and taxes in the nation. The adverse economic impacts listed above could result in an even greater drain on the disposable income of citizens in much of New York. When more money must be paid in taxes and for month electric bills, less in available to pay for food, clothing, shelter, medical expenses, education, for saving, for contributions to charities, or for spending with local businesses. The inevitable result is further downward pressure on local economies in upstate and western New York.
6. Loss of value for property near “wind farms.” While the wind industry has sought to claim otherwise, there is no longer any serious doubt that “wind farms” have an adverse effect on the value of neighbor’s property and, often, their quality of life.
Conclusion. Political and media leaders’ misperceptions about the true economic benefits of “wind farms” are unfortunate – especially for New York’s taxpayers and electric customers, and for local economies that are being drained of their economic lifeblood. Hopefully, these leaders will soon catch up with the facts about the true economic impacts of “wind farms.”
Glenn R. Schleede (former New Yorker now living at)
18220 Turnberry Drive
Round Hill, VA 20141-2574
540-338-9958
1NYLEA%7E1.pdf
Why are NY Political and Media Leaders Grossly Overestimating the Economic Benefits of Iberdrola’s Insistence on Investing $2 billion on Wind Farms in NY?
New York political and media leaders are grossly overestimating the favorable local and state economic benefit that would result from Iberdrola’s proposed investment of $2 billion in “wind farms” in New York.
Virtually every public comment from NY political leaders and every news story and editorial on the impending NYS Public Service Commission’s decision emphasizes that Iberdrola would invest $2 billion in “wind farms” in New York if the Spanish company is permitted by the PSC to acquire Energy East and its electric and gas distribution companies in New York, Maine, Massachusetts and Connecticut.
This heavy emphasis on the proposed $2 billion investment suggests that NY leaders do not yet understand that a $2 billion investment in “wind farms” in NY would provide have very little favorable economic in the areas where the “wind farms” would be built or in the state. The economic impacts may even be negative.
This brief paper explains that there would be little, if any, net favorable local or NY state economic impact from a potential $2 billion Iberdrola investment in NY “wind farms because:
• Potentially favorable economic impacts are typically overstated by the wind industry and its advocates within governments, and
• Other factors, often ignored, tend to offset most or all of the favorable impacts.
Overstated Economic Benefits of “Wind Farms”
1. Very little of the $2 billion “investment” would be spent locally or have local economic benefit.
This fact becomes clear when the make-up of a $2 billion investment in “wind farms” is analyzed.
Specifically, the share of total “wind farm” capital costs accounted for by the various elements of cost (i.e., turbines, blades, towers, assembly and installation, etc.) varies widely among “wind farms” depending on such factors as their size, location, terrain, distance from a transmission lines, and when turbines were purchased. (“Wind farm” capital costs have increased dramatically since 2000-2002. )
Detailed breakdowns of cost generally are not revealed by “wind farm” owners. However, a 2006 report from the National Renewable Energy Laboratory (NREL) provides rough estimates of the breakdown of total project costs based on 2000-2003 data. Undoubtedly, these costs have changed but they do permit calculating the following rough estimates of the shares of a $2 billion capital investment that would be expended for various elements of cost:
Element of Capital Cost % of total Share of $2 Billion
• Turbine, Blades & Tower 73.8% $1,476,800,000
• Foundation 3.3% 65,600,000
• Transportation 3.6% 71,300,000
• Roads, Civil Works 5.6% 112,600,000
• Assembly & Installation 2.7% 54,200,000
• Electric Interface & connection 8.7% 173,900,000
• Permits, Engineering 2.3% 45,600,000
Totals 100% $2,000,000,000
This breakdown helps identify the share of costs that might have some favorable local or state economic benefit (but note that other factors, described below, will offset the potential favorable benefits). Specifically:
a. As the above table shows, the overwhelming share of the capital cost of a “wind farm” is for turbines, blades, towers electronics, cables, etc. that are manufactured elsewhere. A majority of wind turbines being installed in the U.S. apparently are imported from other countries. Little, if any, of the money spent for the turbines, blades, towers and related components making up nearly 3/4ths of the cost would be spent in NY.
b. Foundation costs include cement and aggregate for concrete, steel rebar, and earthmoving. Aggregate and some of the workers for concrete work and operators for earth moving equipment may come from the local area or region. However, cement, rebar and earth moving equipment would originate elsewhere and may be imported.
c. Turbines, towers, and blades would be transported from ports or from manufacturing locations outside NY. Transporters probably would be located in those places, not at the “wind farm” site.
d. Roads and civil works probably would require workers and equipment from the local area or region but a significant share of the cost probably would be for the repair of existing roads that are destroyed when moving the heavy turbine and tower components over them.
e. Assembly and installation of turbines, blades, towers and related equipment generally is performed by specialists who travel to “wind farm” sites and, therefore, typically involve few local workers.
f. Electrical interface and connection costs would include cabling to collect electricity from turbines and move it to a substation, the substation itself, and transmission lines to the nearest existing transmission line that could handle the full rated output of the “wind farm.” Transmission line costs will vary widely with distance. The required equipment would not be purchased locally.
g. Permitting and licensing costs would involve owner’s project developers, as well as lawyers, consultants, government fees, and other personal service costs that would likely involve few local workers.
2. Few local jobs result from “wind farm” construction or operation. The wind industry and its advocates with governments often exaggerate the number of jobs that are likely to be filled with local workers during construction (which may take only last 6 to 9 months) and operation of the facility.
As indicated above, very few of the jobs during “wind farm” construction are filled by local workers. Instead, most jobs (often as many as 80%) are filled by specialized workers brought in from other areas. These workers often live and pay taxes elsewhere and probably go home on many weekends. Jobs that are filled locally during the construction period may include transit-mix drivers, laborers, and some heavy equipment operators. Few permanent jobs are created and many of these will be filled by technicians brought in temporarily for maintenance work.
Wind industry lobbyists typically overstate the number and economic benefit of “indirect” jobs (e.g., those in restaurants and hotels because of construction activity) because the construction activity is short lived and project workers brought in from other areas are likely to go home on many weekends and their wages are spent (and taxes paid) in their home towns.
3. Few supplies and services are procured locally and the favorable economic impact is small. Wind energy advocates often overstate the favorable local economic benefit of “wind farms” because they pretend that the full cost of anything procured locally provides a favorable economic benefit. In fact, very little money is spent locally for supplies and services and, importantly, even with these local purchases only the local value added portion (not the whole cost) may provide some local economic benefit.
4. Rental income paid to land owners may have little or no local economic benefit. “Wind farm” developers often claim that rental or lease payments to landowners who permit construction of wind turbines on their property provide a significant local economic benefit. In fact, any income received by landowners has local economic benefit only if that money is spent or saved locally. Money received by absentee landowners or that is spent or invested elsewhere doesn’t help the local economy.
Negative Economic Impacts that Offset Favorable Impacts.
In addition to the adverse environmental ecosystem impacts that are increasingly being documented (e.g., noise, impact on birds, bats, wildlife habit, and scenic impairment), “wind farms” have significant adverse economic impacts that are often ignored by the wind industry and overlooked by government officials.
1. NY and other states are likely to lose significant corporate income tax revenue. As explained in a separate paper, Energy East companies that would be acquired by Iberdrola paid about $114 million in federal and state corporate income taxes in 2007. However, because of extraordinarily large federal and state tax breaks and subsidies, companies owning “wind farms” are able to avoid paying millions of dollars in federal and state corporate income tax. Therefore, if Iberdrola is permitted to own “wind farms,” the company would almost certainly be able to avoid, for years, paying corporate income tax on the electricity and gas distribution companies obtained through its Energy East acquisition. (Note that tax burden avoided by “wind farm” owners is shifted to ordinary taxpayers who do not enjoy such tax shelters.)
2. Local governments may also lose tax revenue if Iberdrola was exempt from avoid paying property tax on “wind farms.” New York law permits exemption from property taxes for “wind farm” equipment, subject to agreement with local governments and school districts. This exemption authority has been exercised in some cases and has resulted in PILOT (payment in lieu of tax agreements) that result in some payments by “wind farm” owners to local governments and non-profit groups. Such agreements – which may be attractive to local officials now in office – are not necessarily in the long run best interests of local governments, or taxpayers who must pick up the tax burden escaped by wind farm owners.
3. Profits from the Energy East electricity and natural gas distribution companies that would be acquired by Iberdrola probably would flow out of New York and out of the US. These profits are derived from electric and gas customers in the states where Energy East companies now operate.
4. Electric customers would almost certainly experience higher monthly electric bills. Electric customers in New York are likely be affected adversely in three ways by the addition of more “wind farms”:
a. The full, true economic cost of electricity from wind is higher than electricity produced from traditional generating sources. Also, the value of electricity produced from wind is lower because it is produced only when wind speeds are within a certain range. Therefore, the electricity is intermittent, volatile, and unreliable. It is most likely to be produced at night in colder weather rather than on hot summer late afternoons in July and August when demand is highest.
b. Wind turbines cannot be counted on to produce electricity at the time of peak demand. Therefore, reliable (“dispatchable”) generating capacity – not intermittent, unreliable wind turbines – will have to be added to meet increases in peak electricity demand in NY and/or to replace existing generating capacity. Electric customers could end up paying twice; once for unreliable wind capacity and again for capacity than can be counted on to meet peak demand.
c. The subsidies paid to “wind farms” in New York by NYSERDA and paid for with money collected from electric customers via a surcharge added to their monthly bills.
5. Money is drained from local economies. New York residents are already paying some of the very highest electricity prices and taxes in the nation. The adverse economic impacts listed above could result in an even greater drain on the disposable income of citizens in much of New York. When more money must be paid in taxes and for month electric bills, less in available to pay for food, clothing, shelter, medical expenses, education, for saving, for contributions to charities, or for spending with local businesses. The inevitable result is further downward pressure on local economies in upstate and western New York.
6. Loss of value for property near “wind farms.” While the wind industry has sought to claim otherwise, there is no longer any serious doubt that “wind farms” have an adverse effect on the value of neighbor’s property and, often, their quality of life.
Conclusion. Political and media leaders’ misperceptions about the true economic benefits of “wind farms” are unfortunate – especially for New York’s taxpayers and electric customers, and for local economies that are being drained of their economic lifeblood. Hopefully, these leaders will soon catch up with the facts about the true economic impacts of “wind farms.”
Glenn R. Schleede (former New Yorker now living at)
18220 Turnberry Drive
Round Hill, VA 20141-2574
540-338-9958
1NYLEA%7E1.pdf
PSC Iberdrola Energy East September 2, 2008 Letter by Robert H. Murray
September 2, 2008
New York Public Services Commission
Empire State Plaza
Agency Building 3
Albany, New York 12223-1350
RE: Iberdrola/Energy East acquisition
Dear Commissioners Brown, Acampora, Harris, and Curry:
Please exercise basic commons sense in the Iberdrola/Energy East acquisition and deny the request. Doing so will be of greatest benefit to the citizens of New York .
I met Judge Rafael Epstein on a snowy day last February and was impressed with his thoroughness and agree with the recommendations he made to the Commission regarding the Iberdrola/Energy East acquisition.
I urge ALL MEMBERS of the Commission to follow the recommendations Judge Epstein made in response to the charge he was given by the Commission to conduct hearings across our State and create recommendations based on the hearings. To not follow the judges recommendations disenfranchises all those who expressed their concerns about the acquisition.
As a nation and as New Yorkers we are trying to become independent of foreign interests. Granting Iberdrola both generating AND distribution defies common sense because creates, and virtually condones, numerous possibilities for future abuse.
My mother always said beware of people who say "trust me". I observe a lot implied "trust me" when it comes to wind power generation. Used judiciously, wind DOES have a place in the overall mix of meeting energy needs.
I have previously written the Commission with one example of the type of "short cut" one member of the wind industry tried to make, and if unopposed would have circumvented laws or policies on the books. I refer to a "rush to judgment" based on the promise of jobs, money and unsubstantiated claims for cleaning up our environment.
I urge the Commission to give VERY careful consideration to the consequences of creating a scenario which would take years, and MANY New Yorker dollars, to undo.
Respectfully,
Robert H. Murray
Retired Applications Engineer, Rochester Institute of Technology
52 Manor Hill Drive
Fairport, NY 14450-2533
c. (585) 944-0392
New York Public Services Commission
Empire State Plaza
Agency Building 3
Albany, New York 12223-1350
RE: Iberdrola/Energy East acquisition
Dear Commissioners Brown, Acampora, Harris, and Curry:
Please exercise basic commons sense in the Iberdrola/Energy East acquisition and deny the request. Doing so will be of greatest benefit to the citizens of New York .
I met Judge Rafael Epstein on a snowy day last February and was impressed with his thoroughness and agree with the recommendations he made to the Commission regarding the Iberdrola/Energy East acquisition.
I urge ALL MEMBERS of the Commission to follow the recommendations Judge Epstein made in response to the charge he was given by the Commission to conduct hearings across our State and create recommendations based on the hearings. To not follow the judges recommendations disenfranchises all those who expressed their concerns about the acquisition.
As a nation and as New Yorkers we are trying to become independent of foreign interests. Granting Iberdrola both generating AND distribution defies common sense because creates, and virtually condones, numerous possibilities for future abuse.
My mother always said beware of people who say "trust me". I observe a lot implied "trust me" when it comes to wind power generation. Used judiciously, wind DOES have a place in the overall mix of meeting energy needs.
I have previously written the Commission with one example of the type of "short cut" one member of the wind industry tried to make, and if unopposed would have circumvented laws or policies on the books. I refer to a "rush to judgment" based on the promise of jobs, money and unsubstantiated claims for cleaning up our environment.
I urge the Commission to give VERY careful consideration to the consequences of creating a scenario which would take years, and MANY New Yorker dollars, to undo.
Respectfully,
Robert H. Murray
Retired Applications Engineer, Rochester Institute of Technology
52 Manor Hill Drive
Fairport, NY 14450-2533
c. (585) 944-0392
Monday, September 01, 2008
Iberdrola deal on the line as PSC vote nears by LARRY RULISON
ALBANY -- Iberdrola SA could walk away from its $4.5 billion merger with Energy East Corp. if state regulators try to extract too much money from the Spanish utility.
Just a few days from a vote by the Public Service Commission, one of the biggest questions surrounding the deal appears to be just how much Iberdrola will be required to share with customers.
In the past, the five-member PSC, which regulates utilities in New York, has required so-called "positive benefit adjustments" typically used to lower rates for gas and electric service. The so-called PBAs help satisfy the need for the commission to find public benefits before approving such large mergers.
It remains unclear how much in PBAs the commission will require when it votes on the Iberdrola deal Wednesday in Albany.
According to testimony offered this week to PSC commissioners by senior advisory staff, Iberdrola could decide to walk away from the merger if it feels the PBAs are too onerous.
In a hearing before the PSC on Aug. 20, staff had suggested three different scenarios that involved between $202 million and $300 million in PBAs.
Two of the scenarios involved sharing earnings with consumers, while the third called for a rate case before the PSC in which the agency could potentially reset Iberdrola's electric and gas rates in upstate New York.
The stakes are high for consumers. Energy East, the Maine-based company that Iberdrola wants to acquire, operates New York State Electric & Gas and Rochester Gas & Electric, which have 1.7 million customers in upstate New York.
However, at this week's PSC meeting, senior staff member John Stewart noted there was a risk in choosing any option that included sharing earnings, since Iberdrola has opposed such requirements in testimony its has given in the case. The proposed acquisition has been before the PSC for a year.
"There is some risk that the transaction could not be consummated," he said.
Stewart said perhaps the best option for the commissioners to consider would be $275 million in PBAs, with a rate case started within 12 to 18 months.
Some of the commissioners and staff debated whether Iberdrola would be able to cut costs at Energy East and therefore extract more earnings from the company. Under an earnings sharing scenario, those earnings would be shared with customers, lowering rates.
However, some said it would be difficult for Iberdrola to find enough synergies with Energy East in the short term to significantly raise earnings before a rate case would begin.
Commissioner Maureen Harris was also concerned that the $275 million number was arbitrary and perhaps not enough.
Previously, PSC staff had been seeking more than $600 million in PBAs, more than triple than the $202 million that Iberdrola has said it is willing to pay.
Stewart said the $275 million number was chosen because it was in the middle of what staff thought was an acceptable range between $250 million and $300 million.
"All we're talking about is the risks," Harris said. "I don't want to look a gift horse in the mouth, but I'm concerned. I'm really concerned about the level of PBAs we're discussing."
Just a few days from a vote by the Public Service Commission, one of the biggest questions surrounding the deal appears to be just how much Iberdrola will be required to share with customers.
In the past, the five-member PSC, which regulates utilities in New York, has required so-called "positive benefit adjustments" typically used to lower rates for gas and electric service. The so-called PBAs help satisfy the need for the commission to find public benefits before approving such large mergers.
It remains unclear how much in PBAs the commission will require when it votes on the Iberdrola deal Wednesday in Albany.
According to testimony offered this week to PSC commissioners by senior advisory staff, Iberdrola could decide to walk away from the merger if it feels the PBAs are too onerous.
In a hearing before the PSC on Aug. 20, staff had suggested three different scenarios that involved between $202 million and $300 million in PBAs.
Two of the scenarios involved sharing earnings with consumers, while the third called for a rate case before the PSC in which the agency could potentially reset Iberdrola's electric and gas rates in upstate New York.
The stakes are high for consumers. Energy East, the Maine-based company that Iberdrola wants to acquire, operates New York State Electric & Gas and Rochester Gas & Electric, which have 1.7 million customers in upstate New York.
However, at this week's PSC meeting, senior staff member John Stewart noted there was a risk in choosing any option that included sharing earnings, since Iberdrola has opposed such requirements in testimony its has given in the case. The proposed acquisition has been before the PSC for a year.
"There is some risk that the transaction could not be consummated," he said.
Stewart said perhaps the best option for the commissioners to consider would be $275 million in PBAs, with a rate case started within 12 to 18 months.
Some of the commissioners and staff debated whether Iberdrola would be able to cut costs at Energy East and therefore extract more earnings from the company. Under an earnings sharing scenario, those earnings would be shared with customers, lowering rates.
However, some said it would be difficult for Iberdrola to find enough synergies with Energy East in the short term to significantly raise earnings before a rate case would begin.
Commissioner Maureen Harris was also concerned that the $275 million number was arbitrary and perhaps not enough.
Previously, PSC staff had been seeking more than $600 million in PBAs, more than triple than the $202 million that Iberdrola has said it is willing to pay.
Stewart said the $275 million number was chosen because it was in the middle of what staff thought was an acceptable range between $250 million and $300 million.
"All we're talking about is the risks," Harris said. "I don't want to look a gift horse in the mouth, but I'm concerned. I'm really concerned about the level of PBAs we're discussing."
Residents group concerned about project conflicts over wind power
At least one Stark Town Board member and three town Zoning Board of Appeals members have signed leases with the developer behind the Jordanville Wind Project, according to Herkimer County property records.
Stark town officials said they have been paying close attention to these potential conflicts of interest and have followed legal advice to make sure they haven’t done anything wrong.
But officials from the Otsego 2000 residents group have sent a letter to the state Attorney General’s Office asking for an investigation into the practices of the developer of the project — Iberdrola Renewables, Otsego 2000 interim Executive Director Nicole Dillingham said.
Iberdrola Renewables is moving forward with a plan for a project that would include 40 wind turbines in southern Herkimer County, Communications Manager Paul Copleman said.
Dillingham said she is concerned because she believes the company:
* Improperly signed leases with Stark town officials.
* Pressed residents in Stark and Warren to sign leases that include stipulations that restrict residents from talking negatively about the project.
* Were involved with town meetings that resulted in a court decision stating the towns mishandled decisions about the project.
“That to me is really in conflict with home rule,” Dillingham said. “I think they’re taking advantage of these small communities.”
But Stark town officials said they have put great effort into avoiding conflicts of interest and handling the project appropriately.
“We spend more time trying to do that than we do trying to make the decisions themselves,” town Supervisor Richard Bronner said.
The rural town of Stark is just one of many locations in the state where people are questioning whether wind power production companies are inappropriately influencing officials making decisions about potential projects.
Officials in the state Attorney General’s Office are investigating two production companies developing projects in eight counties and have received complaints about additional companies in other counties, office spokesman John Milgrim said. He couldn’t confirm whether complaints were made in Herkimer County or against Iberdrola.
Herkimer County District Attorney John Crandall said he received a complaint regarding a Herkimer County wind project and referred it to Herkimer state police because he doesn’t have an investigative staff.
He wouldn’t be more specific about details of the complaint, and Herkimer state police Investigator Reese Treen said he wasn’t aware of a complaint.
The Stark truth
Town Councilman Thomas Puskarenko signed a lease with the wind company May 4, 2007, according to Herkimer County property records. Town Zoning Board of Appeals members Bruce Banks, Dave Hardy and John Skendara also signed leases with the developer, according to the property records.
Puskarenko, who had no comment, first abstained from a vote related to the wind project Feb. 7, 2006, according to Stark town records. From that point on and even after he signed the lease, he participated in some votes about the project and abstained from others, records show.
He didn’t attend a town meeting May 4, 2007. During that meeting, Bronner read a letter from Puskarenko stating that he wouldn’t participate in any future actions involving the project due to a conflict of interest because he might have a wind turbine constructed on his property, town records show.
Puskarenko has recused himself from all votes related to the project since submitting the letter, records show.
Iberdrola Renewables officials are surprised anyone would continue to question this situation because an Onondaga County Supreme Court decision Dec. 7, 2007, addressed the issue, Copleman said.
Judge Donald’s Greenwood’s decision discusses a claim that Puskarenko failed to disclose a conflict of interest.
“The court has reviewed these contentions and finds them to be without merit,” Greenwood said in his decision.
Iberdrola is not a subject of the Attorney General’s Office investigation, and the company strives to make the development process as transparent as possible with open, public meetings, Copleman said.
“If any transactions involve landowners who are elected or appointed officials related to the project, Iberdrola Renewables requests the recusal of those officials from related decision making,” he said.
‘I see no conflict’
The Zoning Board of Appeals members haven’t faced any conflict of interest concerns because their only authority is when someone files an appeal, member Banks said.
The board meets once per year but hasn’t received any appeals relating to the wind project – and actually hasn’t received any appeals at all during his service, Banks said.
“I see no conflict,” he said. “There’s no plausible conflict there.”
Banks said he would recuse himself if anything related to the wind project ever came before the board.
Hardy and Skendara could not be reached.
Bronner said it can be difficult to avoid potential conflicts of interest when such a large project is proposed in a small town, but he thinks it has been handled properly because officials have followed the advice of people who previously have been through this kind of thing.
It can be tough to even find people to serve on a board in a small town, Bronner said. It’s frustrating when some residents and organizations question their motivations, when they’re attempting to do the right thing.
“What we’re trying to do is what’s best for all the taxpayers – not just a couple who don’t approve of what’s going on,” he said.
‘A great concern’
Dillingham of Otsego 2000 said she knows Puskarenko does recuse himself from votes now.
“But it is a great concern that you have people sitting on the town board who are leaseholders on the project,” she said.
Dillingham also said Iberdrola contracts restrict landowners from speaking against the project and only pay them minimal amounts of money. Landowners receive a $1,000 bonus and $500 per year for five years, then royalties each year going forward, she said.
“It’s really a sad situation, I think, that these kinds of contracts are basically pushed on the communities,” she said. “I blame Iberdrola for this.”
Dillingham also mentioned Greenwood’s December 2007 court decision, which in addition to addressing the potential conflict of interest, resulted in a huge setback for the wind project.
Greenwood ruled the Warren Town Board failed to look closely enough at the project’s potential impact, and that the Warren and Stark town boards acted in violation of the state’s Open Meetings Law and Freedom of Information Law.
The decision deemed the project’s environmental studies null and void and awarded attorney’s fees to a group of residents who brought the lawsuit.
Steve Reichenbach, one of those residents and the interim president of Advocates for Stark, said he doesn’t think it is right that a town board member with a lease could partake in discussions and decisions about the project.
“I think that’s definitely a conflict of interest,” he said.
Reichenbach wouldn’t say whether he had filed any complaints.
Statewide investigation
An investigation into other wind companies in the state started in Franklin County, where county District Attorney Derek Champagne received complaints from residents who brought proof of lease-holding town officials voting on projects.
“That obviously was a huge red flag,” Champagne said. “Under general municipal law, that could easily be construed as unethical at a minimum and a crime at maximum.”
There were seven officials in Franklin County who had leases or family members with leases, he said, and complaints eventually came to him from more than 12 counties.
“It’s a problem that essentially is occurring all over the state of New York,” he said.
Concerned with the trend, Champagne began looking into why it was occurring and decided there needs to be a statewide energy policy that helps local towns deal with wind projects, which involve issues far more complicated than their town attorneys are used to dealing with, he said.
The investigation grew too large for Champagne and his staff, so he turned it all over to state Attorney General Andrew Cuomo, he said.
On July 15, the Attorney General’s Office announced an investigation into wind power companies First Wind and Noble Environmental Power. Combined, the companies have developed or are developing projects in eight counties.
The announcement states the investigation comes “amid allegations of improper dealings with public officials and anti-competitive practices.”
Cuomo said officials in his office will handle the issue.
“The use of wind power, like all renewable energy sources, should be encouraged to help clean our air and end our reliance on fossil fuels,” Cuomo said in a released statement.
“However, our public integrity remains a top priority of my office and if dirty tricks are used to facilitate even clean-energy projects, my office will put a stop to it.”
Stark town officials said they have been paying close attention to these potential conflicts of interest and have followed legal advice to make sure they haven’t done anything wrong.
But officials from the Otsego 2000 residents group have sent a letter to the state Attorney General’s Office asking for an investigation into the practices of the developer of the project — Iberdrola Renewables, Otsego 2000 interim Executive Director Nicole Dillingham said.
Iberdrola Renewables is moving forward with a plan for a project that would include 40 wind turbines in southern Herkimer County, Communications Manager Paul Copleman said.
Dillingham said she is concerned because she believes the company:
* Improperly signed leases with Stark town officials.
* Pressed residents in Stark and Warren to sign leases that include stipulations that restrict residents from talking negatively about the project.
* Were involved with town meetings that resulted in a court decision stating the towns mishandled decisions about the project.
“That to me is really in conflict with home rule,” Dillingham said. “I think they’re taking advantage of these small communities.”
But Stark town officials said they have put great effort into avoiding conflicts of interest and handling the project appropriately.
“We spend more time trying to do that than we do trying to make the decisions themselves,” town Supervisor Richard Bronner said.
The rural town of Stark is just one of many locations in the state where people are questioning whether wind power production companies are inappropriately influencing officials making decisions about potential projects.
Officials in the state Attorney General’s Office are investigating two production companies developing projects in eight counties and have received complaints about additional companies in other counties, office spokesman John Milgrim said. He couldn’t confirm whether complaints were made in Herkimer County or against Iberdrola.
Herkimer County District Attorney John Crandall said he received a complaint regarding a Herkimer County wind project and referred it to Herkimer state police because he doesn’t have an investigative staff.
He wouldn’t be more specific about details of the complaint, and Herkimer state police Investigator Reese Treen said he wasn’t aware of a complaint.
The Stark truth
Town Councilman Thomas Puskarenko signed a lease with the wind company May 4, 2007, according to Herkimer County property records. Town Zoning Board of Appeals members Bruce Banks, Dave Hardy and John Skendara also signed leases with the developer, according to the property records.
Puskarenko, who had no comment, first abstained from a vote related to the wind project Feb. 7, 2006, according to Stark town records. From that point on and even after he signed the lease, he participated in some votes about the project and abstained from others, records show.
He didn’t attend a town meeting May 4, 2007. During that meeting, Bronner read a letter from Puskarenko stating that he wouldn’t participate in any future actions involving the project due to a conflict of interest because he might have a wind turbine constructed on his property, town records show.
Puskarenko has recused himself from all votes related to the project since submitting the letter, records show.
Iberdrola Renewables officials are surprised anyone would continue to question this situation because an Onondaga County Supreme Court decision Dec. 7, 2007, addressed the issue, Copleman said.
Judge Donald’s Greenwood’s decision discusses a claim that Puskarenko failed to disclose a conflict of interest.
“The court has reviewed these contentions and finds them to be without merit,” Greenwood said in his decision.
Iberdrola is not a subject of the Attorney General’s Office investigation, and the company strives to make the development process as transparent as possible with open, public meetings, Copleman said.
“If any transactions involve landowners who are elected or appointed officials related to the project, Iberdrola Renewables requests the recusal of those officials from related decision making,” he said.
‘I see no conflict’
The Zoning Board of Appeals members haven’t faced any conflict of interest concerns because their only authority is when someone files an appeal, member Banks said.
The board meets once per year but hasn’t received any appeals relating to the wind project – and actually hasn’t received any appeals at all during his service, Banks said.
“I see no conflict,” he said. “There’s no plausible conflict there.”
Banks said he would recuse himself if anything related to the wind project ever came before the board.
Hardy and Skendara could not be reached.
Bronner said it can be difficult to avoid potential conflicts of interest when such a large project is proposed in a small town, but he thinks it has been handled properly because officials have followed the advice of people who previously have been through this kind of thing.
It can be tough to even find people to serve on a board in a small town, Bronner said. It’s frustrating when some residents and organizations question their motivations, when they’re attempting to do the right thing.
“What we’re trying to do is what’s best for all the taxpayers – not just a couple who don’t approve of what’s going on,” he said.
‘A great concern’
Dillingham of Otsego 2000 said she knows Puskarenko does recuse himself from votes now.
“But it is a great concern that you have people sitting on the town board who are leaseholders on the project,” she said.
Dillingham also said Iberdrola contracts restrict landowners from speaking against the project and only pay them minimal amounts of money. Landowners receive a $1,000 bonus and $500 per year for five years, then royalties each year going forward, she said.
“It’s really a sad situation, I think, that these kinds of contracts are basically pushed on the communities,” she said. “I blame Iberdrola for this.”
Dillingham also mentioned Greenwood’s December 2007 court decision, which in addition to addressing the potential conflict of interest, resulted in a huge setback for the wind project.
Greenwood ruled the Warren Town Board failed to look closely enough at the project’s potential impact, and that the Warren and Stark town boards acted in violation of the state’s Open Meetings Law and Freedom of Information Law.
The decision deemed the project’s environmental studies null and void and awarded attorney’s fees to a group of residents who brought the lawsuit.
Steve Reichenbach, one of those residents and the interim president of Advocates for Stark, said he doesn’t think it is right that a town board member with a lease could partake in discussions and decisions about the project.
“I think that’s definitely a conflict of interest,” he said.
Reichenbach wouldn’t say whether he had filed any complaints.
Statewide investigation
An investigation into other wind companies in the state started in Franklin County, where county District Attorney Derek Champagne received complaints from residents who brought proof of lease-holding town officials voting on projects.
“That obviously was a huge red flag,” Champagne said. “Under general municipal law, that could easily be construed as unethical at a minimum and a crime at maximum.”
There were seven officials in Franklin County who had leases or family members with leases, he said, and complaints eventually came to him from more than 12 counties.
“It’s a problem that essentially is occurring all over the state of New York,” he said.
Concerned with the trend, Champagne began looking into why it was occurring and decided there needs to be a statewide energy policy that helps local towns deal with wind projects, which involve issues far more complicated than their town attorneys are used to dealing with, he said.
The investigation grew too large for Champagne and his staff, so he turned it all over to state Attorney General Andrew Cuomo, he said.
On July 15, the Attorney General’s Office announced an investigation into wind power companies First Wind and Noble Environmental Power. Combined, the companies have developed or are developing projects in eight counties.
The announcement states the investigation comes “amid allegations of improper dealings with public officials and anti-competitive practices.”
Cuomo said officials in his office will handle the issue.
“The use of wind power, like all renewable energy sources, should be encouraged to help clean our air and end our reliance on fossil fuels,” Cuomo said in a released statement.
“However, our public integrity remains a top priority of my office and if dirty tricks are used to facilitate even clean-energy projects, my office will put a stop to it.”
PSC Iberdrola September 1, 2008 Letter by Ruth Matilsky
6724 Baker Road
Prattsburgh, NY 14873
September 1, 2008
To the Commissioners of the PSC:
I believe that it would be wrong for you to approve the Iberdrola acquisition of Energy East. A wind developer should not have control of the transmission lines.
This letter is being sent to the Attorney General’s office. As you know, they are investigating Noble Environmental and First Wind. It is my belief that as they learn of more and more illegalities, they will widen the scope of their investigation and they will want to understand just why the state of New York, under the direction of the PSC, has allowed a situation to exist that smacks of dereliction of duty at its best and bribery at its worst.
Prior to 1995 the Energy Council was charged with the duty of developing health and safety regulations for renewable energy projects. The PSC was supposed to help in this endeavor and was specifically named. Safety regulations were never developed for wind factories, and in 1995 the Energy Council was disbanded by then Governor Pataki. I don’t know what reasons you had for not developing safety regulations prior to 1995 when the Energy Council existed, but when Pataki disbanded the Energy Council, the PSC never went to the State Legislature and reported that now the State of New York had no way of ensuring the health and safety of its citizens who would live near wind factories.
Even so, you had Article X, which would have helped, but even this means of regulation expired several years ago and the PSC once again did not bother to explain to the Legislature that without regulations and without Article X, the State of New York had no way to regulate wind factories. And there really is no excuse because by the time Article X expired, wind developers were descending on the state in droves.
What you did do was get to work developing the Renewable Portfolio Standard, which, from the outside, would appear to be a good thing. But you neglected to build into the RPS a way for the state to ensure that wind projects would be built in areas where wind is optimal. And, of course, you left health and safety up to the wisdom of small towns across the state – small towns that did not have the knowledge or expertise to be able to handle such a task.
I am also aware that you allowed wind developers Erich Bachmeyer from Global Winds Harvest, a Massachusetts company, and Thomas Hagner from Ecogen LLC to be part of the Renewable Portfolio Standard Committee. There probably were more wind developers but I would not be familiar with their names.
Now I will draw your attention to the specific situation in Prattsburgh, where we have two wind developers – Ecogen LLC (Prattsburgh Wind project) and First Wind (Windfarm Prattsburgh) attempting to build projects which will share the same transmission lines to the transfer station. It has been openly admitted by everyone having anything to do with these projects – including the lead agent, the Steuben County IDA and the developers themselves – that due to the present transmission system it will never be possible for both projects to be up and running at the same time. This has never seemed to bother anyone at the state level, including the PSC.
Each company has other transmission problems because neither one has been able to secure the leases it needs to get the electricity from the turbines to the substations. When documented bullying tactics did not work, Windfarm Prattsburgh convinced the town of Prattsburgh to condemn the property of 7 landowners in order to secure leases to put in underground cables. I’m sure you are aware that the Supervisor of the Town of Prattsburgh, a licensed realtor, openly admitted that a couple of months before condemnation proceedings began, he received a commission for a real estate deal involving the wind company. So, to be short and sweet, the condemnations are fraught with scandal. If the town of Prattsburgh succeeds in condemning the land, you may be sure that Ecogen LLC will demand similar treatment, as will wind developers across the state.
Going back a bit, in the EIS, Windfarm Prattsburgh described a very different transmission route from the one it now is proposing. The earlier one involved overground cables. A year and a half ago, Windfarm Prattsburgh was in negotiation with NYSEG to use NYSEG’s ROWs. However that deal fell through when they all realized that NYSEG’s ROWS are a mere 30 feet wide, and the Windfarm Prattsburgh project would require 100 foot ROWS for tree trimming. It is my belief that NYSEG was unwilling or unable to condemn land to widen the ROWS, so Windfarm Prattsurgh decided to go underground.
Now, if Iberdrola, a huge wind developer, owned NYSEG at that time, that scenario would have been a whole lot different. Do you really think that Iberdrola would have hesitated to condemn the ROWs? Would they have cared about the landowners? 100 foot ROWs would have drastically changed the Prattsburgh landscape so that not only would we have 400 foot monstrous turbines on our ridgetops, but the country lanes would have been lined with 100 foot poles, and acres of forest would have been cut.
In Prattsburgh and Italy and Cohocton the wind conditions just barely meet the standards set by NYSERDA. Just look at the AWS Truewind maps and it will become obvious in a second. So here we have a situation where the wind is minimal and add that to the intermittency of wind and the fact that New York has the highest number of icing incidents in the country – icing incidents which would shut down the turbines during peak wind production months – and you have to ask yourself why on earth a project is being built here in the first place.
The answer is simple – the state, under the guidance and urgency of the PSC, has made it profitable for multi-national corporations to be the owners of wind projects that would never make a dime without state subsidies – projects that will not help the renewable energy needs of our state and of our country. The corporations don’t care if the wind plants are unprofitable because they will then have tax write offs on top of the subsidies.
The PSC has been complicit in this game – levying the systems benefit tax and the renewable energy tax without the approval of the legislature – and leading people to believe that when they voluntarily pay more money for “wind credits” that they are helping to reduce pollution through the use of “clean energy.”
Now you are ready to allow Iberdrola to own wind plants and to control transmission lines. Iberdrola is not going to care whether the wind projects reduce our dependency on fossil fuels. They are building wind plants and want to control the transmission lines for one reason – MONEY. And they will make money no matter how infrequently the wind blows.
One has to wonder what you are thinking.
Very truly yours,
RUTH FRIEDNER MATILSKY
Prattsburgh, NY 14873
September 1, 2008
To the Commissioners of the PSC:
I believe that it would be wrong for you to approve the Iberdrola acquisition of Energy East. A wind developer should not have control of the transmission lines.
This letter is being sent to the Attorney General’s office. As you know, they are investigating Noble Environmental and First Wind. It is my belief that as they learn of more and more illegalities, they will widen the scope of their investigation and they will want to understand just why the state of New York, under the direction of the PSC, has allowed a situation to exist that smacks of dereliction of duty at its best and bribery at its worst.
Prior to 1995 the Energy Council was charged with the duty of developing health and safety regulations for renewable energy projects. The PSC was supposed to help in this endeavor and was specifically named. Safety regulations were never developed for wind factories, and in 1995 the Energy Council was disbanded by then Governor Pataki. I don’t know what reasons you had for not developing safety regulations prior to 1995 when the Energy Council existed, but when Pataki disbanded the Energy Council, the PSC never went to the State Legislature and reported that now the State of New York had no way of ensuring the health and safety of its citizens who would live near wind factories.
Even so, you had Article X, which would have helped, but even this means of regulation expired several years ago and the PSC once again did not bother to explain to the Legislature that without regulations and without Article X, the State of New York had no way to regulate wind factories. And there really is no excuse because by the time Article X expired, wind developers were descending on the state in droves.
What you did do was get to work developing the Renewable Portfolio Standard, which, from the outside, would appear to be a good thing. But you neglected to build into the RPS a way for the state to ensure that wind projects would be built in areas where wind is optimal. And, of course, you left health and safety up to the wisdom of small towns across the state – small towns that did not have the knowledge or expertise to be able to handle such a task.
I am also aware that you allowed wind developers Erich Bachmeyer from Global Winds Harvest, a Massachusetts company, and Thomas Hagner from Ecogen LLC to be part of the Renewable Portfolio Standard Committee. There probably were more wind developers but I would not be familiar with their names.
Now I will draw your attention to the specific situation in Prattsburgh, where we have two wind developers – Ecogen LLC (Prattsburgh Wind project) and First Wind (Windfarm Prattsburgh) attempting to build projects which will share the same transmission lines to the transfer station. It has been openly admitted by everyone having anything to do with these projects – including the lead agent, the Steuben County IDA and the developers themselves – that due to the present transmission system it will never be possible for both projects to be up and running at the same time. This has never seemed to bother anyone at the state level, including the PSC.
Each company has other transmission problems because neither one has been able to secure the leases it needs to get the electricity from the turbines to the substations. When documented bullying tactics did not work, Windfarm Prattsburgh convinced the town of Prattsburgh to condemn the property of 7 landowners in order to secure leases to put in underground cables. I’m sure you are aware that the Supervisor of the Town of Prattsburgh, a licensed realtor, openly admitted that a couple of months before condemnation proceedings began, he received a commission for a real estate deal involving the wind company. So, to be short and sweet, the condemnations are fraught with scandal. If the town of Prattsburgh succeeds in condemning the land, you may be sure that Ecogen LLC will demand similar treatment, as will wind developers across the state.
Going back a bit, in the EIS, Windfarm Prattsburgh described a very different transmission route from the one it now is proposing. The earlier one involved overground cables. A year and a half ago, Windfarm Prattsburgh was in negotiation with NYSEG to use NYSEG’s ROWs. However that deal fell through when they all realized that NYSEG’s ROWS are a mere 30 feet wide, and the Windfarm Prattsburgh project would require 100 foot ROWS for tree trimming. It is my belief that NYSEG was unwilling or unable to condemn land to widen the ROWS, so Windfarm Prattsurgh decided to go underground.
Now, if Iberdrola, a huge wind developer, owned NYSEG at that time, that scenario would have been a whole lot different. Do you really think that Iberdrola would have hesitated to condemn the ROWs? Would they have cared about the landowners? 100 foot ROWs would have drastically changed the Prattsburgh landscape so that not only would we have 400 foot monstrous turbines on our ridgetops, but the country lanes would have been lined with 100 foot poles, and acres of forest would have been cut.
In Prattsburgh and Italy and Cohocton the wind conditions just barely meet the standards set by NYSERDA. Just look at the AWS Truewind maps and it will become obvious in a second. So here we have a situation where the wind is minimal and add that to the intermittency of wind and the fact that New York has the highest number of icing incidents in the country – icing incidents which would shut down the turbines during peak wind production months – and you have to ask yourself why on earth a project is being built here in the first place.
The answer is simple – the state, under the guidance and urgency of the PSC, has made it profitable for multi-national corporations to be the owners of wind projects that would never make a dime without state subsidies – projects that will not help the renewable energy needs of our state and of our country. The corporations don’t care if the wind plants are unprofitable because they will then have tax write offs on top of the subsidies.
The PSC has been complicit in this game – levying the systems benefit tax and the renewable energy tax without the approval of the legislature – and leading people to believe that when they voluntarily pay more money for “wind credits” that they are helping to reduce pollution through the use of “clean energy.”
Now you are ready to allow Iberdrola to own wind plants and to control transmission lines. Iberdrola is not going to care whether the wind projects reduce our dependency on fossil fuels. They are building wind plants and want to control the transmission lines for one reason – MONEY. And they will make money no matter how infrequently the wind blows.
One has to wonder what you are thinking.
Very truly yours,
RUTH FRIEDNER MATILSKY
Sunday, August 31, 2008
First Wind Admissions in the SEC IPO S-1 Filing
Listen to the WLEA report on the admissions of First Wind in their SEC IPO filing.
first%20wind%20filing%20story%20.mp3
About the Jordanville Wind Project
The original plan for a 68-turbine, 136-megawatt project in southern Herkimer County took its first major hit in August 2007 when the state Public Service Commission accepted a scaled-down version of the project - with 19 fewer turbines - to avoid adverse environmental impacts on the Glimmerglass Historic District.
In December 2007, state Supreme Court Justice Donald Greenwood of Onondaga County ruled the Warren Town Board failed to look closely enough at the project's potential impact, and that the Warren and Stark town boards acted in violation of the state's Open Meetings Law and Freedom of Information Law. This ruled the environmental studies null and void.
The project developer, Iberdrola Renewables, is moving forward with a new plan for a project that would include only 40 wind turbines, Communications Manager Paul Copleman said. The environmental studies are being conducted for a second time, he said.
In December 2007, state Supreme Court Justice Donald Greenwood of Onondaga County ruled the Warren Town Board failed to look closely enough at the project's potential impact, and that the Warren and Stark town boards acted in violation of the state's Open Meetings Law and Freedom of Information Law. This ruled the environmental studies null and void.
The project developer, Iberdrola Renewables, is moving forward with a new plan for a project that would include only 40 wind turbines, Communications Manager Paul Copleman said. The environmental studies are being conducted for a second time, he said.
Need for tax breaks vexing
WIND FARMS: Subsidy opponents say taxpayer cash going to the rich
Money doesn't grow on trees, but it may grow on windmills.
The developers of the four proposed wind farms in Jefferson County could capitalize on tax breaks and incentives at the federal, state and local levels through their projects. Opponents say the subsidies take taxpayer money and give it to those who already are rich.
"It's the taxpayers and electric customers that are taken to the cleaners," said Glenn R. Schleede, a widely known wind power opponent who has worked for electric utilities and the federal Office of Management and Budget.
Supporters say the subsidies are needed to encourage environmentally friendly policy.
Carol E. Murphy, executive director of Alliance for Clean Energy New York, said, "Renewable energy is not going to happen unless those policies are in place."
In Jefferson County, potential local and federal tax breaks and state incentives will total $12.5 million for Iberdrola's Horse Creek Wind Farm, $13.8 million for BP Alternative Energy's Cape Vincent Wind Farm, $7.7 million for Acciona's St. Lawrence Wind Farm and $27.3 for Babcock and Brown's Hounsfield Wind Farm.
FEDERAL TAX CREDIT
The federal Production Tax Credit and state renewable energy credit system are based on a development's production.
The American Wind Energy Association's Web site says that wind turbines usually produce 25 percent to 40 percent of their rated capacity, so over a year, a farm rated at 100 megawatts likely would produce between 219,000 and 350,400 megawatt hours. The federal Production Tax Credit is $20 per megawatt produced. To be on the conservative side, then, proposed wind farms in Jefferson County would bring in about $5.5 million for Iberdrola, $3.5 million for Acciona, $6.2 million for BP Alternative Energy and $11.8 million for Babcock and Brown from the federal credit, which counts dollar-for-dollar against taxes the companies owe.
This development incentive is due to expire at the end of the year. Congress could reauthorize the program.
The end of the credit, Ms. Murphy said, "would be a major, major setback for all renewable energies."
When the credit expired previously at the end of 1999, 2001 and 2003, the installation of wind power dropped precipitously — from 73 percent after 2001 to 93 percent after 1999.
Opponents of wind power say the subsidies shouldn't be used in the first place.
"When you give subsidies, it disrupts the market forces and that's certainly the case with wind, too," Mr. Schleede said.
Ms. Murphy argues that all energy development is subsidized — even oil exploration.
"There's no free lunch on energy," she said.
STATE PAYMENTS
New York, like the federal tax credit, bases its incentive on actual power production. But it is a straight payment for production.
Renewable energy generators contract with the New York State Energy Research and Development Agency to provide a certain amount of energy at a set price.
The average amount per megawatt hour is $17, said Tom Lynch, NYSERDA's director of external affairs.
"They could be producing a lot more electricity than we're buying," he said.
If generators produce enough or aren't on line by a deadline, the company faces penalties.
Kevin C. Hale, senior project manager with NYSERDA, said, "They sign a contract and put up security, which is at risk if they don't come on line."
As in about 25 other states, New York buys the fact that this electricity is "green." They're called renewable energy credits. The contracts are paid by electric customers, through a surcharge on electric bills. The average surcharge has increased from less than $2 in 2006 to $3.30 in 2007 and $4.95 in 2008. The reason for the increase is the state goal of reaching 25 percent of the energy used in the state coming from renewable sources. Wind power is not the only source eligible for the program.
The state program, like the federal tax credit, lasts for 10 years and reassures potential investors that they will have a steady stream of income.
"It attracts private investment, because investors can see the state has a long-term commitment to renewable energy," Ms. Murphy said. "It shows investors, 'We're going to get at least some money from the REC payments.'"
LOW MARKET BIDS
She said wind generators, like hydropower generators, bid in the wholesale market at a very low price, which ensures that their energy will be purchased. So having at least $17 per megawatt hour guaranteed gives investors the assurance that they will make money.
After renewable sources bid in at low prices, oil and coal and other plants bid into the market at higher prices. All the generators are paid the same amount, which is the most that any single generator bids to get into the market.
Wind power opponents say the production from wind generators is not reliable and does not come at the time of greatest need.
"They produce at night in the cold months," Mr. Schleede said. "You can't count on windmills to be available at high-demand times, which are warm summer afternoons."
And as the subsidies continue, more of the interested developers are foreign-owned companies.
In Jefferson County, all four of the developers are based in other countries. Iberdrola is based in Spain, Acciona in Portugal, BP Alternative Energy in Great Britain and Babcock and Brown in Australia.
"I'd rather have that money stay in the U.S., in the hands of small towns in New York so people can spend it locally," Mr. Schleede said.
Money doesn't grow on trees, but it may grow on windmills.
The developers of the four proposed wind farms in Jefferson County could capitalize on tax breaks and incentives at the federal, state and local levels through their projects. Opponents say the subsidies take taxpayer money and give it to those who already are rich.
"It's the taxpayers and electric customers that are taken to the cleaners," said Glenn R. Schleede, a widely known wind power opponent who has worked for electric utilities and the federal Office of Management and Budget.
Supporters say the subsidies are needed to encourage environmentally friendly policy.
Carol E. Murphy, executive director of Alliance for Clean Energy New York, said, "Renewable energy is not going to happen unless those policies are in place."
In Jefferson County, potential local and federal tax breaks and state incentives will total $12.5 million for Iberdrola's Horse Creek Wind Farm, $13.8 million for BP Alternative Energy's Cape Vincent Wind Farm, $7.7 million for Acciona's St. Lawrence Wind Farm and $27.3 for Babcock and Brown's Hounsfield Wind Farm.
FEDERAL TAX CREDIT
The federal Production Tax Credit and state renewable energy credit system are based on a development's production.
The American Wind Energy Association's Web site says that wind turbines usually produce 25 percent to 40 percent of their rated capacity, so over a year, a farm rated at 100 megawatts likely would produce between 219,000 and 350,400 megawatt hours. The federal Production Tax Credit is $20 per megawatt produced. To be on the conservative side, then, proposed wind farms in Jefferson County would bring in about $5.5 million for Iberdrola, $3.5 million for Acciona, $6.2 million for BP Alternative Energy and $11.8 million for Babcock and Brown from the federal credit, which counts dollar-for-dollar against taxes the companies owe.
This development incentive is due to expire at the end of the year. Congress could reauthorize the program.
The end of the credit, Ms. Murphy said, "would be a major, major setback for all renewable energies."
When the credit expired previously at the end of 1999, 2001 and 2003, the installation of wind power dropped precipitously — from 73 percent after 2001 to 93 percent after 1999.
Opponents of wind power say the subsidies shouldn't be used in the first place.
"When you give subsidies, it disrupts the market forces and that's certainly the case with wind, too," Mr. Schleede said.
Ms. Murphy argues that all energy development is subsidized — even oil exploration.
"There's no free lunch on energy," she said.
STATE PAYMENTS
New York, like the federal tax credit, bases its incentive on actual power production. But it is a straight payment for production.
Renewable energy generators contract with the New York State Energy Research and Development Agency to provide a certain amount of energy at a set price.
The average amount per megawatt hour is $17, said Tom Lynch, NYSERDA's director of external affairs.
"They could be producing a lot more electricity than we're buying," he said.
If generators produce enough or aren't on line by a deadline, the company faces penalties.
Kevin C. Hale, senior project manager with NYSERDA, said, "They sign a contract and put up security, which is at risk if they don't come on line."
As in about 25 other states, New York buys the fact that this electricity is "green." They're called renewable energy credits. The contracts are paid by electric customers, through a surcharge on electric bills. The average surcharge has increased from less than $2 in 2006 to $3.30 in 2007 and $4.95 in 2008. The reason for the increase is the state goal of reaching 25 percent of the energy used in the state coming from renewable sources. Wind power is not the only source eligible for the program.
The state program, like the federal tax credit, lasts for 10 years and reassures potential investors that they will have a steady stream of income.
"It attracts private investment, because investors can see the state has a long-term commitment to renewable energy," Ms. Murphy said. "It shows investors, 'We're going to get at least some money from the REC payments.'"
LOW MARKET BIDS
She said wind generators, like hydropower generators, bid in the wholesale market at a very low price, which ensures that their energy will be purchased. So having at least $17 per megawatt hour guaranteed gives investors the assurance that they will make money.
After renewable sources bid in at low prices, oil and coal and other plants bid into the market at higher prices. All the generators are paid the same amount, which is the most that any single generator bids to get into the market.
Wind power opponents say the production from wind generators is not reliable and does not come at the time of greatest need.
"They produce at night in the cold months," Mr. Schleede said. "You can't count on windmills to be available at high-demand times, which are warm summer afternoons."
And as the subsidies continue, more of the interested developers are foreign-owned companies.
In Jefferson County, all four of the developers are based in other countries. Iberdrola is based in Spain, Acciona in Portugal, BP Alternative Energy in Great Britain and Babcock and Brown in Australia.
"I'd rather have that money stay in the U.S., in the hands of small towns in New York so people can spend it locally," Mr. Schleede said.
Residents group concerned about project conflicts over wind power
At least one Stark Town Board member and three town Zoning Board of Appeals members have signed leases with the developer behind the Jordanville Wind Project, according to Herkimer County property records.
Stark town officials said they have been paying close attention to these potential conflicts of interest and have followed legal advice to make sure they haven’t done anything wrong.
But officials from the Otsego 2000 residents group have sent a letter to the state Attorney General’s Office asking for an investigation into the practices of the developer of the project — Iberdrola Renewables, Otsego 2000 interim Executive Director Nicole Dillingham said.
Iberdrola Renewables is moving forward with a plan for a project that would include 40 wind turbines in southern Herkimer County, Communications Manager Paul Copleman said.
Dillingham said she is concerned because she believes the company:
* Improperly signed leases with Stark town officials.
* Pressed residents in Stark and Warren to sign leases that include stipulations that restrict residents from talking negatively about the project.
* Were involved with town meetings that resulted in a court decision stating the towns mishandled decisions about the project.
“That to me is really in conflict with home rule,” Dillingham said. “I think they’re taking advantage of these small communities.”
But Stark town officials said they have put great effort into avoiding conflicts of interest and handling the project appropriately.
“We spend more time trying to do that than we do trying to make the decisions themselves,” town Supervisor Richard Bronner said.
The rural town of Stark is just one of many locations in the state where people are questioning whether wind power production companies are inappropriately influencing officials making decisions about potential projects.
Officials in the state Attorney General’s Office are investigating two production companies developing projects in eight counties and have received complaints about additional companies in other counties, office spokesman John Milgrim said. He couldn’t confirm whether complaints were made in Herkimer County or against Iberdrola.
Herkimer County District Attorney John Crandall said he received a complaint regarding a Herkimer County wind project and referred it to Herkimer state police because he doesn’t have an investigative staff.
He wouldn’t be more specific about details of the complaint, and Herkimer state police Investigator Reese Treen said he wasn’t aware of a complaint.
The Stark truth
Town Councilman Thomas Puskarenko signed a lease with the wind company May 4, 2007, according to Herkimer County property records. Town Zoning Board of Appeals members Bruce Banks, Dave Hardy and John Skendara also signed leases with the developer, according to the property records.
Puskarenko, who had no comment, first abstained from a vote related to the wind project Feb. 7, 2006, according to Stark town records. From that point on and even after he signed the lease, he participated in some votes about the project and abstained from others, records show.
He didn’t attend a town meeting May 4, 2007. During that meeting, Bronner read a letter from Puskarenko stating that he wouldn’t participate in any future actions involving the project due to a conflict of interest because he might have a wind turbine constructed on his property, town records show.
Puskarenko has recused himself from all votes related to the project since submitting the letter, records show.
Iberdrola Renewables officials are surprised anyone would continue to question this situation because an Onondaga County Supreme Court decision Dec. 7, 2007, addressed the issue, Copleman said.
Judge Donald’s Greenwood’s decision discusses a claim that Puskarenko failed to disclose a conflict of interest.
“The court has reviewed these contentions and finds them to be without merit,” Greenwood said in his decision.
Iberdrola is not a subject of the Attorney General’s Office investigation, and the company strives to make the development process as transparent as possible with open, public meetings, Copleman said.
“If any transactions involve landowners who are elected or appointed officials related to the project, Iberdrola Renewables requests the recusal of those officials from related decision making,” he said.
‘I see no conflict’
The Zoning Board of Appeals members haven’t faced any conflict of interest concerns because their only authority is when someone files an appeal, member Banks said.
The board meets once per year but hasn’t received any appeals relating to the wind project – and actually hasn’t received any appeals at all during his service, Banks said.
“I see no conflict,” he said. “There’s no plausible conflict there.”
Banks said he would recuse himself if anything related to the wind project ever came before the board.
Hardy and Skendara could not be reached.
Bronner said it can be difficult to avoid potential conflicts of interest when such a large project is proposed in a small town, but he thinks it has been handled properly because officials have followed the advice of people who previously have been through this kind of thing.
It can be tough to even find people to serve on a board in a small town, Bronner said. It’s frustrating when some residents and organizations question their motivations, when they’re attempting to do the right thing.
“What we’re trying to do is what’s best for all the taxpayers – not just a couple who don’t approve of what’s going on,” he said.
‘A great concern’
Dillingham of Otsego 2000 said she knows Puskarenko does recuse himself from votes now.
“But it is a great concern that you have people sitting on the town board who are leaseholders on the project,” she said.
Dillingham also said Iberdrola contracts restrict landowners from speaking against the project and only pay them minimal amounts of money. Landowners receive a $1,000 bonus and $500 per year for five years, then royalties each year going forward, she said.
“It’s really a sad situation, I think, that these kinds of contracts are basically pushed on the communities,” she said. “I blame Iberdrola for this.”
Dillingham also mentioned Greenwood’s December 2007 court decision, which in addition to addressing the potential conflict of interest, resulted in a huge setback for the wind project.
Greenwood ruled the Warren Town Board failed to look closely enough at the project’s potential impact, and that the Warren and Stark town boards acted in violation of the state’s Open Meetings Law and Freedom of Information Law.
The decision deemed the project’s environmental studies null and void and awarded attorney’s fees to a group of residents who brought the lawsuit.
Steve Reichenbach, one of those residents and the interim president of Advocates for Stark, said he doesn’t think it is right that a town board member with a lease could partake in discussions and decisions about the project.
“I think that’s definitely a conflict of interest,” he said.
Reichenbach wouldn’t say whether he had filed any complaints.
Statewide investigation
An investigation into other wind companies in the state started in Franklin County, where county District Attorney Derek Champagne received complaints from residents who brought proof of lease-holding town officials voting on projects.
“That obviously was a huge red flag,” Champagne said. “Under general municipal law, that could easily be construed as unethical at a minimum and a crime at maximum.”
There were seven officials in Franklin County who had leases or family members with leases, he said, and complaints eventually came to him from more than 12 counties.
“It’s a problem that essentially is occurring all over the state of New York,” he said.
Concerned with the trend, Champagne began looking into why it was occurring and decided there needs to be a statewide energy policy that helps local towns deal with wind projects, which involve issues far more complicated than their town attorneys are used to dealing with, he said.
The investigation grew too large for Champagne and his staff, so he turned it all over to state Attorney General Andrew Cuomo, he said.
On July 15, the Attorney General’s Office announced an investigation into wind power companies First Wind and Noble Environmental Power. Combined, the companies have developed or are developing projects in eight counties.
The announcement states the investigation comes “amid allegations of improper dealings with public officials and anti-competitive practices.”
Cuomo said officials in his office will handle the issue.
“The use of wind power, like all renewable energy sources, should be encouraged to help clean our air and end our reliance on fossil fuels,” Cuomo said in a released statement.
“However, our public integrity remains a top priority of my office and if dirty tricks are used to facilitate even clean-energy projects, my office will put a stop to it.”
Stark town officials said they have been paying close attention to these potential conflicts of interest and have followed legal advice to make sure they haven’t done anything wrong.
But officials from the Otsego 2000 residents group have sent a letter to the state Attorney General’s Office asking for an investigation into the practices of the developer of the project — Iberdrola Renewables, Otsego 2000 interim Executive Director Nicole Dillingham said.
Iberdrola Renewables is moving forward with a plan for a project that would include 40 wind turbines in southern Herkimer County, Communications Manager Paul Copleman said.
Dillingham said she is concerned because she believes the company:
* Improperly signed leases with Stark town officials.
* Pressed residents in Stark and Warren to sign leases that include stipulations that restrict residents from talking negatively about the project.
* Were involved with town meetings that resulted in a court decision stating the towns mishandled decisions about the project.
“That to me is really in conflict with home rule,” Dillingham said. “I think they’re taking advantage of these small communities.”
But Stark town officials said they have put great effort into avoiding conflicts of interest and handling the project appropriately.
“We spend more time trying to do that than we do trying to make the decisions themselves,” town Supervisor Richard Bronner said.
The rural town of Stark is just one of many locations in the state where people are questioning whether wind power production companies are inappropriately influencing officials making decisions about potential projects.
Officials in the state Attorney General’s Office are investigating two production companies developing projects in eight counties and have received complaints about additional companies in other counties, office spokesman John Milgrim said. He couldn’t confirm whether complaints were made in Herkimer County or against Iberdrola.
Herkimer County District Attorney John Crandall said he received a complaint regarding a Herkimer County wind project and referred it to Herkimer state police because he doesn’t have an investigative staff.
He wouldn’t be more specific about details of the complaint, and Herkimer state police Investigator Reese Treen said he wasn’t aware of a complaint.
The Stark truth
Town Councilman Thomas Puskarenko signed a lease with the wind company May 4, 2007, according to Herkimer County property records. Town Zoning Board of Appeals members Bruce Banks, Dave Hardy and John Skendara also signed leases with the developer, according to the property records.
Puskarenko, who had no comment, first abstained from a vote related to the wind project Feb. 7, 2006, according to Stark town records. From that point on and even after he signed the lease, he participated in some votes about the project and abstained from others, records show.
He didn’t attend a town meeting May 4, 2007. During that meeting, Bronner read a letter from Puskarenko stating that he wouldn’t participate in any future actions involving the project due to a conflict of interest because he might have a wind turbine constructed on his property, town records show.
Puskarenko has recused himself from all votes related to the project since submitting the letter, records show.
Iberdrola Renewables officials are surprised anyone would continue to question this situation because an Onondaga County Supreme Court decision Dec. 7, 2007, addressed the issue, Copleman said.
Judge Donald’s Greenwood’s decision discusses a claim that Puskarenko failed to disclose a conflict of interest.
“The court has reviewed these contentions and finds them to be without merit,” Greenwood said in his decision.
Iberdrola is not a subject of the Attorney General’s Office investigation, and the company strives to make the development process as transparent as possible with open, public meetings, Copleman said.
“If any transactions involve landowners who are elected or appointed officials related to the project, Iberdrola Renewables requests the recusal of those officials from related decision making,” he said.
‘I see no conflict’
The Zoning Board of Appeals members haven’t faced any conflict of interest concerns because their only authority is when someone files an appeal, member Banks said.
The board meets once per year but hasn’t received any appeals relating to the wind project – and actually hasn’t received any appeals at all during his service, Banks said.
“I see no conflict,” he said. “There’s no plausible conflict there.”
Banks said he would recuse himself if anything related to the wind project ever came before the board.
Hardy and Skendara could not be reached.
Bronner said it can be difficult to avoid potential conflicts of interest when such a large project is proposed in a small town, but he thinks it has been handled properly because officials have followed the advice of people who previously have been through this kind of thing.
It can be tough to even find people to serve on a board in a small town, Bronner said. It’s frustrating when some residents and organizations question their motivations, when they’re attempting to do the right thing.
“What we’re trying to do is what’s best for all the taxpayers – not just a couple who don’t approve of what’s going on,” he said.
‘A great concern’
Dillingham of Otsego 2000 said she knows Puskarenko does recuse himself from votes now.
“But it is a great concern that you have people sitting on the town board who are leaseholders on the project,” she said.
Dillingham also said Iberdrola contracts restrict landowners from speaking against the project and only pay them minimal amounts of money. Landowners receive a $1,000 bonus and $500 per year for five years, then royalties each year going forward, she said.
“It’s really a sad situation, I think, that these kinds of contracts are basically pushed on the communities,” she said. “I blame Iberdrola for this.”
Dillingham also mentioned Greenwood’s December 2007 court decision, which in addition to addressing the potential conflict of interest, resulted in a huge setback for the wind project.
Greenwood ruled the Warren Town Board failed to look closely enough at the project’s potential impact, and that the Warren and Stark town boards acted in violation of the state’s Open Meetings Law and Freedom of Information Law.
The decision deemed the project’s environmental studies null and void and awarded attorney’s fees to a group of residents who brought the lawsuit.
Steve Reichenbach, one of those residents and the interim president of Advocates for Stark, said he doesn’t think it is right that a town board member with a lease could partake in discussions and decisions about the project.
“I think that’s definitely a conflict of interest,” he said.
Reichenbach wouldn’t say whether he had filed any complaints.
Statewide investigation
An investigation into other wind companies in the state started in Franklin County, where county District Attorney Derek Champagne received complaints from residents who brought proof of lease-holding town officials voting on projects.
“That obviously was a huge red flag,” Champagne said. “Under general municipal law, that could easily be construed as unethical at a minimum and a crime at maximum.”
There were seven officials in Franklin County who had leases or family members with leases, he said, and complaints eventually came to him from more than 12 counties.
“It’s a problem that essentially is occurring all over the state of New York,” he said.
Concerned with the trend, Champagne began looking into why it was occurring and decided there needs to be a statewide energy policy that helps local towns deal with wind projects, which involve issues far more complicated than their town attorneys are used to dealing with, he said.
The investigation grew too large for Champagne and his staff, so he turned it all over to state Attorney General Andrew Cuomo, he said.
On July 15, the Attorney General’s Office announced an investigation into wind power companies First Wind and Noble Environmental Power. Combined, the companies have developed or are developing projects in eight counties.
The announcement states the investigation comes “amid allegations of improper dealings with public officials and anti-competitive practices.”
Cuomo said officials in his office will handle the issue.
“The use of wind power, like all renewable energy sources, should be encouraged to help clean our air and end our reliance on fossil fuels,” Cuomo said in a released statement.
“However, our public integrity remains a top priority of my office and if dirty tricks are used to facilitate even clean-energy projects, my office will put a stop to it.”
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