[ exact phrase in "" • ~10 sec • results by date ]

[ Google-powered • results by relevance ]


LOCATION/TYPE

News Home
Archive
RSS

Subscribe to RSS feed

Add NWW headlines to your site (click here)

Sign up for daily updates

Keep Wind Watch online and independent!

Donate $10

Donate $5

Selected Documents

All Documents

Research Links

Alerts

Press Releases

FAQs

Publications & Products

Photos & Graphics

Videos

Allied Groups

Wind fall: How much money are entrepreneurs and the town of Kingston actually making from wind turbines?  

Credit:  BY: Bruce Mohl | CommonWealth | www.commonwealthmagazine.org 10 August 2012 ~~

Kingston was one of the first towns in the state to figure out a way to go green and make money doing it. Now, with giant turbines majestically turning in the wind alongside Route 3, it’s a good time to check how much money the community and the private entrepreneurs it is working with are actually making.

The South Shore town approached its green deals cautiously back in 2010. It wanted to maximize its revenue but minimize its risk, so town officials entered into what are essentially partnerships with two private wind energy entrepreneurs. The partners shoulder most of the risk, putting up all the money to get the turbines up and running. Kingston, meanwhile, is taking advantage of special legislation its representatives got passed on Beacon Hill that allows the town to sell the electricity generated by its partners to the region’s power grid through NStar.

Under state law, businesses or individuals who sell excess power to the grid are paid one price, but municipalities such as Kingston are paid a significant premium, roughly an extra 20 percent, or 2 cents per kilowatt hour.

Kingston’s first partner is Kingston Wind Independence LLC, which put up a single turbine on the town’s former landfill and pays the town rent of $150,000 a year, a figure that rises 3 percent a year for the 20-year life of the lease. Kingston sells the power from the lone turbine to NStar, remits most of the proceeds to Kingston Wind Independence, and pockets the difference.

Town records show that for the one-month period from May 14 to June 13, the turbine generated 157,560 kilowatt hours of electricity. Kingston was paid 13.5 cents a kilowatt hour by NStar, or a total of $21,228, under the municipal rate. Kingston then paid the turbine operator the equivalent of 11.6 cents a kilowatt hour, or a total of $18,277. Kingston pocketed the difference of $2,951, or about 14 percent of the total.

Mary O’Donnell is Kingston’s other wind partner. O’Donnell, a Kingston resident who runs a company called No Fossil Fuel LLC, is running three turbines on her property next door to the town’s commuter rail station. Back in 2010, she convinced Kingston officials to act as a conduit for the sale of her electricity to NStar and the regional grid, an arrangement that netted her the higher municipal price for the power.

At the time, O’Donnell urged Kingston officials not to charge her anything for acting as her sales agent. She said the deal was so fragile that she couldn’t afford to pay anything more than the higher property taxes she would owe after installing three wind turbines on her property. She also pointed out that her wind development, unlike an earlier housing project she had proposed for the site, would not increase demand for the town’s services. Kingston’s Board of Selectmen essentially accepted her argument, taking a token fee of 1 percent of her electricity sales.

“People think she got a sweetheart deal. She did, but what we got out of that deal was new tax revenue,” said Mark Beaton, who runs a local restaurant and previously, as a member of the Board of Selectmen, was the key driver of the town’s green deals. Beaton said the deal also insured that O’Donnell would not put housing on her property, which would have brought with it a costly influx of children into the town’s schools.

Kingston’s assessor says O’Donnell’s new property tax assessment hasn’t been set yet, but he said a rough approximation could be calculated using last year’s tax rate and a turbine cost of $2.5 million. Using those figures, O’Donnell’s turbine investments would bring an additional $115,000 a year into the town’s coffers.

Town records indicate one of O’Donnell’s turbines generated 961,560 kilowatt hours of electricity over the five-month period from Jan. 12 to June 13. NStar paid the town an average of slightly more than 13 cents a kilowatt hour over that period, or a total of $128,487. The town pocketed its 1 percent – $1,285 – and passed the rest along to O’Donnell. By my calculation, O’Donnell collected about $19,000 more by tapping into Kingston’s special municipal rate

O’Donnell says she still isn’t making any money off her turbines, but Beaton doesn’t believe her. “She’s a liar,” he said. “Banks wouldn’t have lent her the money if she wasn’t going to make money.”

But O’Donnell says no bank has lent her money for the project. She says she thought she had a bank loan arranged for the purchase of her turbines, but it was withdrawn at the last minute. She said she was able to push ahead with the project because her turbine manufacturer, Gamesa Corpof Madrid, has been patient and not insisted on immediate payment. Gamesa, which replaced its chief executive earlier this year following a falloff in its share price, could not be reached for comment. (Update: David Rosenberg, a company spokesman based in Pennsylvania, emailed that “Gamesa does not disclose the conditions of private sales agreements or contracts, or the negotiations surrounding any potential supply deals. We continue to be in discussions with project owner Mary O’Donnell and are confident that a solution to the project financing will be reached.”)

O’Donnell says the many other contractors she used to install her turbines were paid out of $3.3 million she received from the federal government in April as part of a stimulus program designed to encourage renewable energy development. She says she is still hopeful she will secure a bank loan to pay off Gamesa, which manufactured her turbines at a plant in Pennsylvania, but is exploring other options if that doesn’t happen.

In the meantime, O’Donnell is busy pursuing other ventures. In an about-face from her earlier stance, she now says she wants to build a 300-unit environmentally sustainable housing development on the land where her turbines are located. She is also preparing to put up a six megawatt solar farm in Dartmouth, a four megawatt solar farm in Marshfield, and is bidding on a proposed solar farm on town land in Kingston. She says she may use proceeds from her solar ventures, along with her wind revenues, to pay off Gamesa, but it’s unclear how she would make those deals work if the revenues from them are being siphoned off.

“I’m out there working it,” O’Donnell said.

Source:  BY: Bruce Mohl | CommonWealth | www.commonwealthmagazine.org 10 August 2012

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

Wind Watch relies entirely
on User Funding
Donate $5 PayPal Donate

Share:


News Watch Home

Get the Facts Follow Wind Watch on Twitter

Wind Watch on Facebook

Share

CONTACT DONATE PRIVACY ABOUT SEARCH
© National Wind Watch, Inc.
Use of copyrighted material adheres to Fair Use.
"Wind Watch" is a registered trademark.
Share

 Follow: