Spanish wind-farm developer, Muskegon County preparing to execute lease minus Scandia 

MUSKEGON COUNTY, MI – Gamesa Energy, a Spanish-based wind-farm developer and wind-turbine manufacturer, and Muskegon County appear ready to move forward with a plan to eventually construct a wind farm on the county’s massive wastewater site.

Based on letter correspondence between Gamesa and the county, the delay on executing the proposed lease agreement is expected to end soon.

The Muskegon County Board of Public Works, which approved the proposed lease agreement in October, has been waiting for Gamesa to sign the agreement that will essentially give the international wind-energy company the exclusive right to investigate the possibility of constructing a wind farm on the 11,000-acre site. In exchange for exclusivity, Gamesa will pay the county thousands of dollars.

The delay in execution of the proposed lease stemmed from a potential joint venture on the project between Gamesa and Scandia Wind Offshore, a company that once proposed creating a wind farm in Lake Michigan off the Grand Haven and Pentwater areas.

The letter from Gamesa, dated March 15, states there will not be a joint venture between Gamesa and Scandia.

“Despite our best efforts over the last several months, it has now become clear that Gamesa and Scandia are unable to agree on mutually acceptable terms for the proposed joint venture,” George Nall, business development manager for Gamesa, wrote in the letter. “As there was no alternative scenario to this joint venture discussed or proposed, this letter serves as both notification and as a request for further guidance from the county board.”

The Board of Public Works is set to consider Thursday sending a response letter to Gamesa and essentially agreeing to move forward with the project. The board meeting is scheduled for 3:30 p.m. Thursday at the Hall of Justice in Muskegon.

County staff is recommending that the Public Works Board agree to move forward. The county expects to be able to use the proposed lease agreement as written, pointing out that it does not reference Scandia as a party to the agreement.

The proposed letter from the county, which would be signed by Chairman Marvin Engle if approved by the board, raises concerns about a potential lawsuit from Scandia.

“We, therefore, do not see your dispute with Scandia as being an obstacle to the contract with the county,” the proposed letter states. “However, we are concerned that this dispute may ripen into litigation and that there is at least the potential that the county may become involved. Given that possibility, we would ask that you indemnify us from contractual claims that may be made by Scandia.”

The proposed contract does include an indemnification clause.

Gamesa representatives have not yet publicly talked about their specific plans for the Muskegon County wind farm. However, based on the county’s working concept, a 100-megawatt, $300 million wind farm could be built on the site.

County officials have cited several expected benefits to the community, including: lease payments for the wastewater fund; personal property taxes that would go through the typical allocation formula to all taxing entities; generating work in the industry for some local businesses; and possible expansion of the wind farm to interested, nearby property owners.

Some concerns have been raised about the potential loss of the personal property taxes if the state eliminates them.