RICHMOND – The series of events surrounding what could be Virginia’s first industrial wind energy utility are converging this month.
Final briefs have been filed with the State Corporation Commission, and a second report from the SCC’s hearing examiner is expected soon. Tomorrow (Friday), the state Supreme Court will issue its decision on the case filed by Highland landowners and residents against county supervisors.
After years of debate on local and state applications, coupled with several legal challenges, Highland County residents will soon know whether 20-some wind turbine towers will become part of their landscape.
The SCC did not decide whether to grant Highland New Wind Development a state permit to build and operate last spring. Instead, it requested more information on plans to monitor and reduce potential environmental damage from the 39-megawatt utility.
Following another hearing in July, all parties involved submitted follow-up briefs, presumably the last arguments before the agency makes its final decision.
Whatever the Supreme Court decides this week and how that decision affects the permitting process is unknown. Most involved believe the SCC will approve a permit for the HNWD, with conditions. If the court upholds the local permit issued by Highland County supervisors in July 2005, HNWD will have to decide whether it can meet the requirements and proceed with investment and construction.
If the Supreme Court rules against the county, the process for the company is likely to be delayed further while it’s repeated at the county level for another conditional use permit.
After extensive arguments and hearings before the SCC, the state hearing examiner, Alexander Skirpan Jr., issued an 84-page report to commissioners in March, which recommended approving a permit under conditions.
But the three commissioners remanded the case back to Skirpan to gather more details on environmental monitoring. Another round of testimony on those issues was held in Richmond in July.
What’s at issue?
The SCC asked HNWD, and other participants in the case – a group of Highland citizens, state agencies, and The Nature Conservancy – to address post-construction monitoring, particularly as applied to birds and bats, and how to avoid or mitigate harm to them. But disagreement remains on several key points, such as how long monitoring should take place, who should pay for the studies and how much should be spent, who should have authority over how those dollars are allocated, and what should be done to reduce harm to wildlife.
HNWD argues up front in its post-hearing brief that, by virtue of its design, the project already carries a smaller footprint when it comes to the environment as compared to other kinds of power utilities.
“The commission should recall that even absent any of the mitigation proposals submitted by the Virginia Department of Game and Inland Fisheries, the construction and operation of this facility will already substantially minimize adverse environmental impact compared to traditional methods of producing electricity,” HNWD said. “For instance, unlike a coal fired power plant, this wind farm will not produce carbon dioxide, nitrous oxide, sulfur dioxide, or mercury emissions. This project will not contribute to what now has been widely accepted as the very real phenomenon of global warming that will continue to jeopardize all wildlife populations absent appropriate action by state and federal agencies.”
HNWD said it would allow access to the project site for studies, and suggests monitoring the turbines’ effects for two years. It does not want to spend more than $454,000 total for monitoring, and suggests perhaps another $100,000 be contributed from other sources like state agencies. The developer maintains that anything beyond that would put the project in jeopardy. “A monitoring and mitigation program that requires (or has the potential to require) expensive and extensive long-lasting expenditures may doom the facility,” HNWD said.
The Virginia Department of Game and Inland Fisheries, on the other hand, said monitoring must take place for the estimated 20-year life-span of the utility, and the developer must shoulder all costs. “Based on evidence from other projects of this type constructed around the nation, it is not disputed that the construction of the project will invade the habitat of significant wildlife species and its operation will result in the deaths of a yet-undetermined number of these creatures,” the agency said.
How much will it cost?
HNWD estimated DGIF’s plan, as proposed by Rick Reynolds, would cost about $6.8 million, which would make it “the most expensive post-construction plan for a wind farm ever.”
DGIF’s plan calls for HNWD to pay $150,000 per year for the first three years of the project for monitoring unless actual costs are lower. After the first three years, HNWD would be required to pay between $25,000-$100,000 a year, depending on the number of birds or bats killed by the turbines’ spinning blades. If species are being killed, the turbines should be shut down when wind speed drops below 6-9 meters per second for 25 nights of the year, eight hours a night. DGIF proposes capping the costs associated with shutting down the turbines at $234,000 a year.
The state agency argues since HNWD seeks a permit from the SCC “which amounts to public permission to construct and operate the project,” the company should bear the cost of whatever it takes to protect public resources that could be damaged by it.
The Nature Conservancy offered testimony from bat expert Dr. Merlin Tuttle. While Tuttle did not recommend a specific price tag for mitigation and monitoring, HNWD noted, he did say 10 turbines could be searched for carcasses every day, April to October, for less than $125,000 a year, and searching all 20 would cost about $133,000 a year.
“The monitoring plan the Conservancy considers to be necessary should cost no more than $125,000 to $150,000 for each of the first three years this project is in operation, and can reasonably be expected to cost less,” TNC said. “Thereafter, the cost of monitoring should be less than $50,000 per year. Based on the information provided by the applicant, the cost of the mitigation plan suggested by the Conservancy, which consists almost exclusively of the revenue lost by the applicant as the result of curtailing operations during certain periods, should not exceed $75,000 annually.”
After three years, TNC said, “monthly, bi-monthly, or even quarterly monitoring of continuing operations should suffice, and that the cost should not exceed $50,000 annually. This periodic monitoring should continue for the life of the project.”
Highland citizens, a group opposed to the project on many levels, offered testimony from Dr. Michael Gannon and Dr. Robert Whitmore; both found the estimated $150,000 per year for monitoring realistic.
But HNWD argued the only “credible” testimony on the estimates was from its expert Jeffrey Paulson, who said even with caps in place under DGIF’s plan, the costs would prevent the utility from being financially viable. Paulson said investors are more likely to put their money into wind facilities in places like Texas, where monitoring costs aren’t an issue.
“Costs imposed for bird and bat monitoring and mitigation, in any amount, would make a wind project more difficult to finance because many jurisdictions do not impose such costs,” HNWD said. “The Conservancy’s request for $73,000 a year for bat mitigation curtailment costs might seem reasonable in a vacuum, but when added to substantial lifetime monitoring costs, is simply not financially.”
Paulson had said HNWD could absorb about $450,000 for monitoring and mitigation. “Mr. Paulson also testified that an extra $1,000 or $2,000 a year would probably not ‘break the deal’ but explained that where the threshold actually exists is difficult to say,” HNWD wrote.
HNWD also submitted testimony from Dr. Paul Kerlinger, who said $95,000 a year for studies is about what’s spent at other facilities. HNWD believes its offer to pay $454,000 is reasonable, and offered to put that amount in a fund managed by a technical advisory committee. The company said, “It is fair to expect the parties concerned about the impact of the project to share in locating additional funding sources to support proposed monitoring and mitigation.”
The group of Highland citizens, however, said if HNWD can’t pay for proper studies, it should not be granted a permit. “HNWD has acknowledged that it cannot afford nor obtain financing to construct and operate the project if any more environmental conditions are put on the project beyond that which it has proposed. Because of the total inadequacy of its proposal … HNWD is admitting that it cannot operate this project in an environmentally responsible manner,” the group said. “Given the significant environmental impacts of this project and HNWD’s inability to afford the studies and mitigation measures recommended by the regulatory agency responsible for the commonwealth’s wildlife, the project is not in the public’s interest.”
Who should pay?
TNC, among others, has argued from the outset that HNWD should pay all costs associated with studying or mitigating impacts, whatever that amount turns out to be.
The Conservancy said there’s nothing requiring the SCC to limit conditions on a permit only to ones it believes a utility can afford. “The sole criterion guiding the commission is and should be whether the conditions will minimize the adverse environmental impact of the project, not whether they will have an adverse impact on the project’s finances,” TNC said. “Small projects can create huge environmental risks and large projects can be environmentally benign. The cost of mitigating the risk should be determined by the size of the risk, not by the size of the project.”
DGIF called HNWD’s plan “severely under-funded,” and expressed concern about what happens when HNWD’s pool of money runs out. “HNWD would leave the expenditure of the money up to a technical advisory committee but there would not be any additional money paid into the fund unless there was a grant from a third party, and even at that point HNWD would provide matching funds up to an additional $150,000 or a total of $450,000 over the life of the project,” the agency said. “One of the primary deficiencies in HNWD’s financial calculations is that the applicant does not believe that there is a need for any monitoring beyond the first two years of the project. Highland citizens’ experts have opined that monitoring and mitigation are needed throughout the life of the project as the project will continue to impact wildlife until the project ceases operations. Indeed, HNWD’s own expert acknowledged that the fatalities will continue for the life of the project. It is illogical and without scientific basis, therefore, to stop the monitoring and mitigation measures after the first few years.”
Who should be in charge?
HNWD’s suggestion of “Technical Advisory Committee” in charge of spending the money set aside for studies is also a matter of contention.
The Conservancy said DGIF should play an “active role” in any plan. “DGIF’s role should be that of a facilitator, and the ultimate authority to accept or reject its recommendations should always remain with the commission.”
HNWD agrees DGIF should participate. “Unfortunately … no VDGIF employee has ever actually participated in a post-construction monitoring program regarding a wind facility,” the company said. “Likewise, no VDGIF employee has any hands on experience with mitigation at a wind farm. Recognizing that VDGIF could be greatly assisted by the expertise of other individuals or entities who have had postconstruction experience with wind farms, Dr. Kerlinger recommended the formation of a Technical Advisory Committee, and testified that virtually every wind facility that does post construction monitoring has a TAC.”
A TAC could be comprised of representatives of DGIF, U.S. Fish and Wildlife Service, the National Audubon Society, Bat Conservation International, West Virginia DNR, Highland New Wind, and The Nature Conservancy, HNWD said.
“The purpose of a Technical Advisory Committee is to provide not only state expertise, but also regional and national expertise in reviewing the best available science and technology 12 to 24 months from now when this project is operational,” HNWD added, and if unresolved disagreements were to arise among members of the committee, the SCC can issue a ruling.
DGIF, on the other hand, said such a committee may not be enough. “A Technical Advisory Committee would decide how the money should be spent. But as applicant’s principal witness confirmed, the implementation of any mitigation recommendations by the TAC under this proposal would be entirely at the discretion of the applicant,” the agency said. “The proposal contains no enforceable mitigation requirements. That is not the way permit conditions work. There must be enforceable requirements … Merely because this is the first proposal for wind generation in Virginia does not mean such precedents or the principles and policies they implement should be abandoned so that the applicant would be allowed to operate free of any requirements to protect wildlife.”
Furthermore, DGIF said, a TAC provides a “possible source of endless disputes requiring oversight and resolution by the commission. Moreover, if such a mechanism sets a precedent for future permits of this nature, it is doubtful that the limited number of persons possessing the necessary expertise to serve on such a TAC would be willing to participate pro bono on a growing list of such organizations. If the commission should decide that it has the authority and desire to delegate oversight functions regarding this project to another entity, the latter should appropriately be a public one such as the department rather than an ad hoc group such as a TAC.”
SCC staff said an advisory committee could be useful, but also had concerns. “The commission recognized that it must evaluate any monitoring and mitigation plan pursuant to the statutory standards. Specifically, the commission also raised the issue whether the Department of Game and Inland Fisheries or other entities could direct modifications in operation of Highland New Wind’s facility, if approved, of any monitoring and mitigation plan,” SCC staff said. “If the project were approved and constructed, Highland New Wind would be subject to all federal and state laws that protected birds and bats. No action of the commission could exempt the company from compliance … Enforcement or modification of any conditions would lie with the commission and not with any advisory body constituted to assist in developing any such plan.”
SCC said while there was nothing to preclude using a committee, “the power and duties of any committee must be prescribed in considerable detail so that its advisory nature is clarified. Recruitment, organization and funding of the committee (i.e. travel, mailing, copying, and telephone expenses) must be considered.”
TNC said monitoring should be conducted by a “qualified firm or group of individuals who are independent of the applicant and who have no financial interest in the facility. The applicant should have the responsibility for selecting and compensating the firm, subject to the right of any party to appeal to the commission if the party has reasonable grounds to question either the competence or the impartiality of the firm selected by the applicant.”
How long should the project be watched?
HNWD said not only would monitoring longer than three years be too expensive, but it’s also not necessary since there is no evidence wind energy plants have killed certain protected species.
DGIF maintains lifetime project monitoring is a must to assess and minimize the impacts. “Logically that is the only way to account for changes in conditions which are almost certain to occur over the life of a project expected to last at least two decades,” the agency said. “While other witnesses agreed with the department, the applicant disagrees, urging that it be allowed to pay a sum certain for the first three years and nothing thereafter. That would leave no legally enforceable remedy for the commonwealth to assess or address wildlife impacts after that time. For the department to accept any such proposal would amount to the abandonment of its continuing statutory responsibility to protect wildlife.”
HNWD submitted testimony from a variety of sources showing lifetime monitoring is not done at other facilities. Most required monitoring for 2-3 years, then adjusting studies as needed depending on the initial results. The developer argues that two years, at $95,000 a year, should be sufficient.
DGIF said for the first three years, its plan and HNWD’s proposal are similar. But after that, HNWD’s plan leaves the company paying nothing, which leaves DGIF to either get public money for more study, or stop monitoring. “The department’s recommendation, as its testimony acknowledged, is flexible. The caps presented by the department are adaptive and would logically be altered depending on the monitoring results obtained during the first years of operation,” DGIF said. “If mortalities are found to be low, there is no reason – subject to some level of continuing oversight – that monitoring cannot be reduced to an appropriate and thereby less costly level.”
Highland citizens said HNWD’s plan is “totally inadequate to address the enormous environmental impact that all parties, including HNWD, agree is likely to occur.”
Even if monitoring plans are in place, citizens said the plan does provide any mitigation to prevent or reduce killing birds and bats in Highland County.
TNC agreed a monitoring plan should include daily searches between April and November, and periodic searches should be done at least once every 30 days the rest of the year. “Monitoring on a daily basis between April 1 and Nov. 1 of each year, and at 30-day intervals during the remainder of the year, should continue for at least three years following the date the facility begins operation,” the Conservancy said. “Thereafter, periodic compliance monitoring and reporting should continue at 60- day intervals for the life of the project … In considering the duration of the monitoring, it is important to keep in mind that monitoring is intended not only to determine the number of avian fatalities, but also to determine the time, date, temperature, wind speed, and weather conditions. The objective, of course, is to determine whether fatalities can be reduced or eliminated by adaptive management techniques; that is, by adjusting the operation of the turbines so as to reduce exposure during times when monitoring has indicated that the risk is highest. There is much evidence in the record in this case, for example, that a majority of bat fatalities occur during nights when wind speeds are below 6 meters per second.”
If birds or bats are killed, what should be done about it?
Mitigating wildlife damage, participants agreed, is necessary. But how to do it varied among the experts.
Most witnesses said shutting down turbines is the only way known to reduce the number of bats killed by the blades.
“If evidence obtained during the first year of monitoring confirms that an unacceptable number of bats are being killed on nights in the spring when wind speeds are below 6 meters per second, it should be possible to determine whether the fatality rate at the Highland facility can be reduced by feathering the rotors of a representative subset of turbines during the times monitoring has identified as critical,” said TNC. “In other words, careful monitoring during the first three years of operations will assist in determining both the risk the project poses to wildlife and the effectiveness of operational changes designed to reduce that risk. Thereafter, periodic monitoring for the life of the project is necessary to determine the continuing effectiveness of whatever adaptive management practices have been implemented and to insure that fatalities are within prescribed limits.”
HNWD agrees there is a correlation between bat activity and wind speed at turbine sites, and the only way to reduce or eliminate killing them is to turn off the turbines during certain periods when wind speeds drop below six meters per second, a threshold determined by Bat Conservation International. Other testimony suggested the threshold might be less than that.
“Accordingly,” HNWD said, “it appears that the only currently available mitigation technique to reduce bat fatalities is to curtail the operation of the turbines under certain wind speeds. (DGIF) proposed that operation of the turbines be curtailed annually for 25 certain pre-selected nights, eight hours a night, when wind speeds dropped below six meters per second. The Nature Conservancy requested that curtailment occur for 180 nights instead of 25 … (HNWD) believes that the best decision as to the exact bat mitigation curtailment hours and nights will need to be made as the years progress and as other information becomes available since it is expected that evidence will support a lower threshold than 6 meters per second and that more limited time periods will dramatically decrease bat mortality to levels deemed acceptable to bat biologists. However, in no event should the total cost to the applicant of curtailment, along with monitoring costs exceed $454,000.”
To mitigate impacts to birds, HNWD proposes that if the “trigger” level of killing 6.9 species “of greatest conservation need” per turbine, per year, is exceeded, then the company will permanently preserve 50 acres of red spruce.
The company suggested mitigation plan goals should be for each species, as follows:
1. Endangered species – “HNWD recognizes applicable federal and state law regarding endangered species and intends to comply with the law.”
2. Bats – Migratory tree bats (red, hoary, and silver-haired): three migratory tree bats per turnot bine, per year. Eastern pipistrelle: one per turbine per year. Eastern small-footed myotis: 0. 1 per turbine per year. All other bats (little brown, big brown, northern longeared, etc.): five. The maximum allowable take of all bats before mitigation measures is 9.1 bats per turbine per year, HNWD noted.
3. Birds, species and greatest conservation need – 6.9 bird species of greatest conservation need per turbine per year as listed in testimony.
What about endangered species?
DGIF suggested HNWD work with it and the USFWS to address incidental takes through a habitat conservation plan for any species that might be killed at the facility.
But HNWD said, “The cost and time required for formal consultation to develop a habitat conservation plan, however, should be weighed against the reasonable likelihood of this facility actually taking an endangered species … The evidence before this commission is that no endangered species has ever been killed by a wind farm in the Eastern United States. Even Dr. Tuttle, founder and president of Bat Conservation International, has acknowledged that no endangered species of bat has been reported to have been killed by a wind turbine. While one could argue that an endangered bat has actually been killed some place and not found, there is no basis in this record for the commission to conclude that a significant risk is posed to endangered bats or birds at this site.”
Therefore, HNWD said, developing a habitat conservation plan isn’t needed.
DGIF disagreed. “This project presents a risk of incidental takes of federal and state threatened or endangered species,” the agency said. “These include the bald eagle, which is still protected by law. There is no minimum lawful take for these species. Public testimony indicated that there is an active eagle population in the project area of Highland County. As a result, the commission should require (HNWD) to comply with federal and state law protecting listed species … In order to avoid costly shutdowns and penalties, the commission should require (HNWD) develop a Habitat Conservation Plan acceptable to the United States Fish and Wildlife Service.”
DGIF also asked the SCC to require the developer to pay for replacing raptors killed, since they have low population levels. “Despite suggestions from applicant’s principal witness that it is being singled out for selective treatment, this suggestion is no different from the requirement of Virginia law that those responsible for fish kills – analogous damage to public re- sources – pay the cost.”
Highland citizens said HNWD’s plan “continues to totally ignore the project’s impact on endangered species in the area. The project site is well within the documented migration route of the endangered Indiana bat and the Virginia big-eared bat and the record contains expert testimony that the likelihood of a take of one or both of these species is ‘extremely high,'” they said. “In addition, recent studies performed by local bird watchers have demonstrated that the bald eagle and possibly the golden eagle nest and live in Highland County year-round. Despite the likelihood that the project will result in a take of one of these protected species, HNWD’s plan fails to address these species in any manner. DGIF and the USFWS have repeatedly warned HNWD that the project will likely result in a take but HNWD has refused the agencies’ recommendations to file a habitat conservation plan and seek an incidental take permit.”
Now that final briefs have been filed, the SCC’s hearing examiner will submit a second report on these issues to the three commissioners. The commissioners will then review the evidence again, and either deny a state permit, or issue one with conditions.
The SCC does not have any deadlines for making its decision. The decision may be appealed to the state Supreme Court by any of the groups involved.
Meanwhile, the Supreme Court will issue its decision on the legal challenge against Highland County officials tomorrow (Friday). Whatever the court decides, there is no further appeal process on that matter.
By Anne Adams
13 September 2007
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