Community Benefits of Utility Scale Wind Power

There are several reasons that the developers state are benefits to the community hosting a Utility Scale Wind Power plant. Each of the items listed below is taken from a paid advertisement that Jasper Energy LLC/Chautauqua Wind Power LLC entitled "What Can the Chautauqua Windpower Project Do for the Towns?" which appeared in the July 1, 2004 edition of The Westfield Republican, the local newspaper in this area. Unfortunately, due to copyright issues and the fact that Jasper Energy LLC/Chautauqua Wind Power LLC has not published this article on their web site, a copy cannot be provided to you. What isn't mentioned in their advertisement is the way that they are dividing our community, driving a wedge between people who have been friendly for many years. One land owner in the area who speaks in favor of the wind project mentioned that because of this person's stance on the wind power issue, several long standing friendships have disintegrated.

Employment

According to the advertisement, "A significant percentage of the construction workers employed during the initial nine-month construction phase are expected to be hired from within the local community." We can't address this project directly since construction has not started but typically, 10% of a crew of 50 or so people, or 5 or 6 of the people working on the construction are local. The remainder are imported labor and the jobs that go to local people are generally unskilled and low paying. Chautauqua Wind Power LLC also claims that five or six permanent operations jobs will be created. What are these jobs? Once Industrial Wind Turbines are installed, they really don't require a lot of day to day intervention by people. Will these jobs actually involve the Wind Power facility or will they be minimum wage security jobs.

PILOT Payments

PILOT Payments are Payment In Lieu Of Taxes. In New York State, renewable energy projects can be built with property tax exempt status, though the municipalities where these projects are built can waive the tax exempt status. The developers of big wind power projects almost always fail to mention that the towns can waive this exemption.

In the town of Westfield, a figure of $100,000 per year in PILOT payments to the town for the entire project has been thrown around¹. Now, the entire project cost is about $69 million for 34 turbines or about $2,000,000 per turbine. If these turbines were subject to the same tax rate as residential property, the taxes on each turbine would be $35,000². Thus three turbines would yield the town the same $100,000. Since about 20 turbines would be sitting in Westfield, if these were taxed, that would mean $700,000 per year to Westfield.

The lifetime of the project is 20 years. It seems that two million dollars over 20 years is a pretty low price to pay to destroy the ridge in this area.

(1) Since nobody at the town level will discuss this issue, this number cannot be verified but it is a pretty good guess

(2) This is based on the tax rate paid to the Town of Westfield on property classified as abandoned agriculture.

Lease Payments

The lease payments for the wind turbines by Chautauqua Windpower LLC would be $3000 per year for the first five years and $1500 per year after that if this project is installed. In exchange, the property owner has to allow one of these giant industrial structures sit on his property, making noise, causing flicker and perhaps generating earth currents, commonly called stray voltage into the ground. Chautauqua Windpower LLC states that these payments will more than compensate for any "minor loss of productivity from farmland used for the Project." What if the losses are not minor? In other areas, installation of utility scale wind turbines has caused declines in dairy production, due in part to changes in the quality of water caused by the installation and stray voltage problems. This is well documented in the report entitled Excerpts from the Final Report of the Township of Lincoln - WIND TURBINE MORATORIUM COMMITTEE

Increased Spending

In their paid ad, the developers claim that "project related spending will spur indirect benefits, including increased local commerce." They site construction workers spending money on meals and accommodation - we assume that they mean construction workers that are brought in from other areas. Doesn't this contradict the statement that they make about a significant percentage of construction workers being from this area? It doesn't if that significant percentage is 10%. Consider this: Once these construction jobs leave the area, all that is left is a divided community and a bunch of potentially dangerous 400 foot tall eyesores.

At the end of the paid add, Chautauqua Windpower says: "As you review the progress of this project, we ask that you think globally, act locally." This is very interesting since utility scale wind power most likely causes an overall increase in greenhouse gas emissions when you take into consideration energy to manufacture and install them and the backup plants that this form of energy requires. Further, according to a Cornell University Study on Alternative Energy, only 48% of the energy needs of the United States can be met using alternative sources and that to do this, 17% of the land mass of the country would be consumed by these alternative sources.

Industrial Wind Power does not meet the claims that the developers make for it. Apparently,
this includes the claims made about benefits to the community.

Benefits to The Developer

The developer of an industrial wind power facility in New York State is the primary recipient of benefits. These include:

• Grants from New York State Energy Research and Development Authority (NYSERDA). If this project is built, the Chautauqua Windpower LLC would receive over 3 million dollars in direct grants. This may sound like a lot of money but the next item makes this look like a drop in the bucket.
  
• Federal tax write offs. Federal tax law allows something called double accelerated depreciation for wind power facilities. What this means is that the company can write off the value of the installation twice over five years. Chautauqua Windpower LLC seems to have nothing and if this is the case, they can't use these tax benefits. According to their representative, Chautauqua Windpower LLC will "sell partnerships to companies that can better utilize the tax benefits." Essentially, this project will be sold to investors looking for tax write offs. Getting down to the dollars involved, Chautauqua Windpower LLC states that the project cost is $69 million. If a company with a marginal tax rate of 35% buys the partnership, the tax benefit will be 70% of $69 million, or about $49,000,000.

Who really benefits from Industrial Wind Power?