Figures from Canadian Wind Energy Association indicated that if the Melancthon II wind energy project had been completed, as scheduled, in 2007, it might have put Ontario ahead of all other Canadian provinces in the production of wind energy.
Like several other such projects, it was delayed by public opposition and municipal approval delays, which led to costly Ontario Municipal Board hearings as well as financial losses to the proponents, local contractors and landowners.
When approved by Ontario Power Authority in November 2005, the 132-MW project was slated for completion in early 2007, and would have followed the commissioning of the 68-MW Melancthon I wind farm in March 2006.
The opposition locally and elsewhere ran the gamut from visual effects, interference with flight patterns of small aircraft, dissatisfaction with revenue sharing, setbacks, noise, fears of towers falling down or rotors throwing ice to suspected health problems from vibrations, shadow flicker and blinking warning lights, among other things.
Melancthon II has won OMB approval for 66 or 67 turbines in Melancthon Township, but remains before the OMB for 22 in Amaranth, delayed over noise problems at the transformer substation.
In the meantime, Canadian Hydro Developers had floated a reported $400-million loan from major financiers and had purchased all the necessary towers, generators and transformers. In late 2006, CEO John Keating estimated the company was losing $10- million annually by the delay.
At the time of OPA’s awarding of the Melancthon II, 20-year contract, then mayor Garry Matthews said that the first phase led to work being awarded to 54 different contractors, with local contractors getting more than $12 million in new work and contractors and subcontractors together being paid more than $25 million. The second phase would roughly double that.
The township didn’t realize the tax revenue it had expected from the turbines, as the province capped the assessment at $40,000 per megawatt, resulting in a $60,000 assessment per 1.5 MW. Melancthon’s share of the expected property tax on each tower is only about $650, with Dufferin getting about $570 and $1,400 going to the province as an education tax.
To offset the reduced assessment, the township gets $1,000 annually per turbine as an amenities payment, for its use alone, on the first-phase towers, and $4,000 per tower annually for those in Melancthon II.
Landowners are paid royalties based on output. Those were estimated at between $5,000 and $8,000, and some reports have been of an average $7,000 per turbine.
In a press release, CHD said the anticipated capital cost of this project is $265 million. “Pending regulatory approvals and financing, construction is scheduled to commence in the spring of 2006, with completion expected in the spring of 2007.”
The Wolfe Island project will consist of 86 2.3- MW wind turbines that will generate an estimated 537,000 MWh per year, more than enough to power the Kingston metropolitan area. Expected to cost $410 million, that project is to involve construction starting in the spring of 2007, after regulatory approvals and financing are obtained, with completion expected by October 2008.
Ontario now has 472 MW of installed capacity in five major wind farms. The 132 MW of Melancthon II, along with Wolfe Island and an Enbridge 200-MW project near Kincardine, would raise Ontario’s capacity to about 1,000 MW, not including small projects under OPA’s Standard Offer Contract for those of less than 10 MW capacity.
Locally, there are several SOC projects on the drawing board – at Grand Valley, Dundalk and Honeywood – but those are likely also to be appealed to the OMB.
The Melancthon II project will win OMB approval only when Hearing Officer Norm Jackson is satisfied that reported noise problems at the transformer substation have been resolved.
Although progress is apparently being made in that respect, transformer neighbour Paul Thompson said the transformer site is being worked on but indicated there’s still a lot to be done.
By Wes Keller
3 January 2008
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