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The costs of decommissioning

Gerdes suggests performance bonds to the county board

Published: Wednesday, June 11, 2014 3:25 p.m. CDT • Updated: Wednesday, June 11, 2014 3:30 p.m. CDT

PRINCETON — Bureau County resident Ed Gerdes addressed the Bureau County Board on Tuesday with further concerns about decommissioning the Big Sky wind turbine project, located north of Ohio.

Since he addressed the board last month, he along with follow residents sharing similar concerns, have done more digging into the project and have developed additional questions about decommissioning.

“The people who should be here talking about the decommissioning are landowners, but as you know, they have a confidentiality clause in their lease which doesn’t allow them to speak publicly,” he said. “In fact, we found out as of now, they don’t know the project has been sold … and I know they don’t know what’s going on with the decommissioning plan either.”

At last month’s county board meeting, Gerdes shared an in-depth study his group had done by a Virginia-based company on decommissioning costs. As previously reported in the BCR, the study revealed the total cost to take down 87 turbines was just over $19.4 million, or about $224,000 per turbine. At that rate, the cost to decommission Big Sky could potentially be in the $10-12 million range.

On Tuesday, Gerdes said his group has been talking with people who are recommending the county opt for a performance bond that would cover the entire cost of decommissioning.

“The money you have now at best would cover probably 15 to 20 percent,” he explained to the board. “And these companies are LLC (Limited Liability Company), so if they do fold up, there are no assets to cover the rest of the decommissioning.”

Another point Gerdes mentioned was property taxes. His group discovered there are landlords with cell phone towers that are forced to pay the property taxes that aren’t getting paid.

“So we’re assuming the landowners are going to be responsible for the property taxes, and the question is from the time the turbines are shut down until they are taken down, are landowners going to be responsible if that could be a two-year period? We assumed they will be responsible for the taxes,” he said. “Plus probably 85 percent of the cost to take them down.”

Gerdes said the turbines have to come down.

“They are a hazard, and on top of that, who is liable for injures suffered from the time they are shut down to the time they are taken down? The landowners I’m assuming would again have to have some sort of liability insurance to take care of that,” he said.

Gerdes reminded the project started with Midwest Energy promising to take down the project when it was over, then it was Edison Mission and; now it’s Pittsburgh-based EverPower Wind Co.

“I really doubt if they will be here,” he said. “Are they going to come up with $10-12 million to take them down, or are they going to walk away and leave you with $1.8 million to take them down yourself? I don’t think the taxpayers of Bureau County should take them down, and I don’t think the landowners planned on having to take them down.”

Following Gerdes’ public comment, the board directed questions at Bureau County State’s Attorney Patrick Herrmann about the benefits of a performance bond.

While he mentioned he needed to check on the issue further, he explained performance bonds are essentially an insurance policy that is paid for by the company and would not be anything subject to bankruptcy.

“It’s there as a life insurance policy. It doesn’t kick in until the day it’s needed. I don’t (believe) it’s an asset than can be voided in bankruptcy,” he said.

The county board voted to allow Herrmann to further check into performance bonds to help offer a better direction on the matter at next month’s meeting.

BCR Senior Staff Writer Donna Barker contributed to this story.

Comment on this story at www.bcrnews.com.

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