EnXco’s Merricourt Wind Project recently received final approval from the North Dakota Public Service Commission—but in order to move forward with the project, the company needs Xcel to settle a lawsuit and resume its contract for the project.
The Merricourt Wind Project in North Dakota has received final approval from the North Dakota Public Service Commission, but pending litigation stands in the way of the project moving forward.
Last month, Xcel Energy, Inc., announced that it terminated an agreement with EnXco, Inc., involving the development of the wind farm. Within a week, the two companies both filed lawsuits—EnXco alleging that Xcel breached its contract, and Xcel arguing that the termination of the agreement was permissible because of unresolved issues and because the deal didn’t close on time.
But now the wind farm has been approved, and Escondido, California-based EnXco is asking Xcel to settle its lawsuit and resume its contract so that the project—a $400 million, 150-megawatt wind farm in southeastern North Dakota—can proceed.
“As we committed to Xcel in 2008, the project is fully permitted and ready to commence construction,” EnXco President and CEO Tristan Grimbert said in a statement. “We remain dedicated to our contractual obligations with Xcel and would be happy to build this project within the stipulated schedule rather than pursue legal action.”
But Xcel stands behind the termination of the contract, saying that there are still issues that have not been resolved.
“These [issues] include concerns expressed by U.S. Fish & Wildlife Service regarding the project’s potential impact on protected wildlife and the uncertainty, cost, and timing of mitigating this impact,” Xcel said in a statement. “These concerns remain unresolved and are currently the subject of litigation between the Xcel Energy and EnXco. We took these actions in order to represent the best interests of our customers.”
It is unclear if the two companies are in negotiations regarding a settlement of the lawsuit, and an Xcel representative would not comment further on the case, citing company policy. An EnXco representative could not be reached for comment on the case.
Xcel and EnXco announced their partnership on the wind farm in October 2008. Under the agreement, EnXco would develop and construct the wind farm, and ownership would be transferred to Xcel subsidiary Northern States Power Company (NSP) upon completion, which was originally scheduled for the end of 2011.
The two companies successfully completed the same type of transfer with the Nobles Wind Project in southwestern Minnesota in April 2010. That wind farm, a 201-megawatt project, became operational in late 2010. It can generate enough power to serve approximately 66,500 homes, according to Xcel.
The state requires Xcel to derive 30 percent of its sales from renewable energy by 2020. The state’s Renewable Energy Standard requires that other electric utilities supply 12 percent of energy for Minnesota consumers from renewable sources by 2012, 20 percent by 2020, and 25 percent by 2025.
Xcel is the state’s largest utility and the ninth-largest public company based on revenue, which totaled $10.3 billion in 2010.
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