Rudman Winchell to advise Aroostook County Commissioners on major wind farm project

By Rudman Winchell Attorney

Attorney Erik Stumpfel of Rudman Winchell was recently engaged by the county commissioners of Aroostook County,
to advise the commissioners on financial discussions with the developer of a
major wind energy project in northern Aroostook County. EDP Renewables North America, LLC,
formerly known as Horizon Wind Energy, is proposing to construct a 125 turbine,
250 megawatt wind energy project on and near Number 9 Mountain, located in the
unorganized townships west of Bridgewater, Maine. If constructed as planned, the project would
become the largest wind energy project in New England. EDP Renewables currently has more than 58,000
acres of land under lease in connection with the project. EDP is also in the process of acquiring
rights of way for a fifty mile transmission line to connect the project to the New England grid.

EDP Renewables North America, LLC is a subsidiary of a large Spanish renewable energy company, EDP Renovaveis.

The Number 9 Mountain project was originally proposed by Horizon Wind in 2007, but did not go forward at that
time. However, in October 2013, the State of Connecticut’s energy department gave final approval to a 15 year power
purchase agreement with EDP, for purchase of electric power generated by the
Maine project and a smaller (20 MW) solar energy project to be built in
Connecticut. Under the purchase agreement, Connecticut’s electric utility companies will be required to
purchase the power output from the two projects at a blended average price of
less than eight cents per kilowatt hour, as part of Connecticut’s
state-mandated renewable energy program.
The purchase agreement is expected to provide EDP Renewables with more
than $1 billion in revenues from power sales over the 15 year contract term.

Under Maine’s Wind Energy Act, developers of wind energy projects in Maine are required to demonstrate a local
community benefit of at least $4,000 per wind turbine per year, for 20 years,
as a condition of receiving state permits. This requirement is typically satisfied by entering into a host
community benefit agreement with the municipality where the project is
located. For wind energy projects located in Maine’s unorganized territories, the county is usually considered to
be the host community. The $4,000 per
turbine figure is a statutory minimum and is subject to negotiation. For several recent wind energy projects in
Maine, the agreed annual benefit amount has exceeded $5,000 per MW, not per
turbine. Developers of wind energy projects in Maine also typically seek to negotiate a partial refund of new property
taxes to be paid by the project, under Maine’s tax increment financing (“TIF”) statute. For most wind energy projects in Maine, the
TIF and community benefit discussions are conducted as a combined negotiation.

When approved, designation of a TIF district allows the host community to use its share of new tax dollars from the
project to fund local economic development efforts within the TIF district and
the host community, through a TIF district development program. In this way, new wind energy projects can
become a major funding source for economic development efforts in Maine’s distressed rural counties and communities.
Attorney Stumpfel has represented
the county commissioners in Washington, Franklin, Hancock and Penobscot
counties, as well as the town of Oakfield and four Lincoln area municipalities,
in financial discussions with the developers of eight previous wind energy projects.

Disclaimer


These materials have been prepared by Rudman Winchell for educational purposes only. They should not be considered legal advice. The transmission of this information to you is not intended to create a lawyer-client relationship. Readers should not act upon this information without seeking professional counsel. You should not send any confidential or private information to Rudman Winchell until a formal attorney-client relationship has been established, in writing.