A challenged $300 million wind farm proposed for a site in Grant County is a public utility immune from any lawsuit seeking to stop its construction, state Supreme Court Justice Brent Benjamin said.
Benjamin disagreed with a majority opinion filed by the court to allow a lawsuit filed by a group of homeowners to proceed.
The wind farm is to include 200 turbines spread over 10 miles.
The Supreme Court’s 4-1 decision overruled a Grant Circuit Court judge’s dismissal of the lawsuit.
The homeowners said the wind farm would diminish property values and possibly pose a danger to them.
Grant Circuit Judge Phil Jordan in April 2006 dismissed the lawsuit, contending the court didn’t have any jurisdiction over the matter because the project already had been approved by the state Public Service Commission.
Jordan further said the plaintiffs’ claims against the companies behind the project – NedPower Mount Storm LLC and Shell WindEnergy, Inc. – were insufficient.
Justices disagreed and said the plaintiffs should get their day in court.
Benjamin, the lone dissenter in the case, said the wind farm builders have the right of eminent domain, to take property through condemnation proceedings.
He said the homeowners could sue over diminished property values once the wind farm is built, but he said they could not sue to stop the wind farm from being built in the first place.
Benjamin notes that in their appeal, the plaintiffs argued – and the majority of the court agreed – that if the wind farm had been considered a public utility subject to full regulation by the Public Service Commission, it would have the right of eminent domain.
The parties conceded that if this were the case, a lawsuit seeking to stop construction of the wind farm would not be possible.
But Benjamin said the wind farm should be considered a public utility even though the PSC only has limited regulatory powers over it.
The facility is considered an “exempt wholesale generator,” which sells the power to electric companies that then deliver it to the public. State law limits PSC regulation over these kinds of facilities.
Congress created the distinction in 1992 to increase private investment in cost-effective wholesale energy sources by limiting government regulation, according to Benjamin’s dissent.
Benjamin points out that in 2002, state justices ruled in a case filed by the Affiliated Construction Trades Council Foundation that an “exempt wholesale generator” is a public utility because the power made ultimately gets sold to the public.
NedPower received its approval from the PSC in April 2003. Later that year, the state Legislature amended the law that lessened PSC regulation over exempt wholesale generators.
But the new law did not negate the court’s ruling in 2002, Benjamin said. So, regardless of the limited regulation, the wind farm is a public utility.
Whether the wind farm is considered a public utility has no bearing on its eminent domain powers, Benjamin argued.
State law permits eminent domain in cases where power is generated for public use.
“In my view, a wind-driven electric power plaint is an ‘electric power plant’ under the provisions of (the law), and eminent domain may be employed in the construction and maintenance thereof if the plant is ‘for public use,'” Benjamin wrote in his dissent.
“An electric power plant may be ‘for public use’ irrespective of the extent of its regulation by the PSC,” the judge wrote.
State lawmakers in 1907 bestowed these powers on electric companies before the PSC was even created in 1913, Benjamin noted.
Another hearing in the wind farm case in Grant Circuit Court has not been scheduled.
Regardless of the pending legal proceedings, construction on the facility is underway and the company expects to start generating power by October.
By Justin D. Anderson
Daily Mail Staff
30 July 2007
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