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Gamesa Energy, Muskegon County agree on terms for potential wind farm  

Credit:  By Eric Gaertner, www.mlive.com 7 May 2012 ~~

MUSKEGON COUNTY, MI – The signature of an international wind-energy company is on the lease agreement that may lead to wind turbines at the Muskegon County wastewater site.

Gamesa Energy USA, a subsidiary of a Spanish-based wind farm developer and wind turbine manufacturer, recently signed the agreement with the county that gives the company exclusive rights to investigate the possibility of constructing a 150-megawatt wind farm on the 11,000-acre property in Egelston and Moorland townships.

County officials have previously estimated the value of the project at about $300 million. If deemed feasible, the company would erect turbines – possibly 30-75 depending on the size of the turbine – in various areas of the site.

On Thursday, the Muskegon County Board of Public Works and Board of Commissioners are scheduled to consider final approval of the agreement. The Public Works Board meeting is set for 3:30 p.m. Thursday at the Hall of Justice, followed by a special meeting of the full county board. County officials are expected to sign the agreement, if approved, after those meetings.

The county’s lease with Gamesa begins with the development term, which is five years long with two possible one-year extensions. The development term allows for completion of the necessary studies, including environmental, and pursuit of a long-term contract to sell the generated power.

The first two years’ payments, more than $100,000, must be paid to the county in advance and is nonrefundable, according to the agreement.

Some county officials are looking at the proposed wind farm at the wastewater site as a major step toward additional wind-energy-based developments in the community.

“It’s a major big deal,” said Muskegon County Public Works Board Chairman Marvin Engle. “I think it’s going to spill over beyond just the wastewater site. It gives everyone a platform on a national stage, an international stage actually.”

The signed lease agreement to explore construction of a wind farm on the county’s wastewater site comes six months after L3 Combat Propulsion Systems in Muskegon and Rockford Berge in Grand Rapids announced the establishment of the Michigan Wind Energy Consortium. The consortium features several companies, including Gamesa, and proposes to build a wind-energy industrial center to build and ship parts for turbines out of Muskegon.

Wind speeds likely remain the final barrier to the proposed development of the wind farm. The county has been measuring the wind on site for months and the early data shows speeds on the low end of typical commercial-wind development.

Gamesa, which is expected to perform its own wind testing on the site, would make the final decision on whether it is feasible and cost effective to pursue the development.

Execution of the proposed lease agreement was delayed for months while Gamesa considered a proposed working arrangement with Scandia Wind, a company that previously proposed a large offshore wind development in Lake Michigan.

Wastewater Director Mark Eisenbarth pointed out that Gamesa’s decision to sign the agreement comes at a time when the proposed extension of the federal wind-energy tax credit has yet to be approved.

“It sends a strong message that they’re committed,” Eisenbarth said.

County officials have cited several expected benefits of the wind farm 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.

County officials have discussed the idea of constructing commercial-sized wind turbines on the sprawling wastewater site for years. The site is considered attractive to potential developers because of having just one property owner to negotiate with and the lack of nearby residential homes.

The final lease agreement includes an indemnification agreement that helps protect Muskegon County from any potential lawsuits stemming from the proposed working arrangement between Gamesa Energy USA and Scandia Wind.

Gamesa, the lead company for the proposed development, and Scandia Wind had been considering a potential partnership as the private development team, Muskegon Wind, but those talks apparently failed to reach an agreement. County officials have said they always were working through Gamesa, a Spanish-based wind farm developer, and the proposed arrangement with Scandia did not factor into the lease agreement.

Source:  By Eric Gaertner, www.mlive.com 7 May 2012

This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

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