June 25, 2008

PUC close to leases for wind turbine sites

The New Ulm Public Utilities Commission Tuesday authorized staff to negotiate with and the city attorney to draft leases for the three landowners involved in supplying the land for placing the utility’s proposed wind generation farm turbines.

After having negotiations break down last fall, “PUC staff has been working with the landowners’ representative [TurningPoint Management, Inc. of Mankato] to develop a mutually agreeable set of terms and conditions on which to base the leases for the wind turbine sites,” Utility Planning & Development Engineer Pat Wrase told the commission.

“The terms developed are acceptable to the representatives of both parties and are within the range typical of wind energy developments, most notably with respect to the lease payment amounts,” Wrase explained.

However, later he admitted “it is not a done deal, but it’s pretty close.”

NUPU is negotiating with three rural New Ulm landowners, Brad Franta, Roger Klossner and Sharon Hacker, for placing five, 1.5-to 2.1-megawatt turbines.

The plan negotiated through TurningPoint calls for two turbines each to be sited on Franta’s and Hacker’s properties while one would be placed on Klossner’s. If the utility were to decide to make changes in the turbine numbers at each site, that decision would “require further discussions,” the plan states.

The proposal calls for the utility to lease a total of 160 acres, in which 60 acres each would be leased from Franta and Hacker and 40 acres from Klossner. The lease rate would start at $3,600 per year per megawatt of turbine generation installed, and an escalator rate of 2.5 percent per year or CPI, whichever is greater, would be imposed “with beginning of year two or January 1, 2010, whichever occurs first and every year thereafter…”

The proposal also calls for a minimum lease period of 20 years “and not more than 30 years.” However, a 20-year term with two 10-year term renewals for a project life of up to 40 years is on the table for discussion.

In other action, the commission:

– Received the utility’s Comprehensive Annual Financial Report for the fiscal year ended Dec. 31, 2007, which indicated the utility is in good financial shape;

– Received notice that the IRS has increased the PUC’s mileage reimbursement rate from 50.5 cents per mile to 58.5 cents per mile effective July 1.

– Adopted Appendix M – Emergency and Disaster Declarations to the City of New Ulm/PUC Policy Manual.

– Heard from Director Gary Gleisner that the new Cottonwood Booster Station now is in service for a 60-day test cycle, and that utility crews are working at Fifth North Street and County Road 27 to install conduit and wire for the primary extension that will serve the Milford Heights First Addition and the lift station that will serve the development.

By Ron Larsen
Journal Staff Writer

The Journal

25 June 2008

URL to article:  https://www.wind-watch.org/news/2008/06/25/puc-close-to-leases-for-wind-turbine-sites/