NextEra Energy of Canada is making good on a threat to take legal action against changes to West Grey’s fees and charges bylaw passed earlier this year.
According to a letter from a company lawyer NextEra is asking the courts to quash the March 18 additions to the bylaw which relate specifically to wind energy projects.
“We are not opposed to paying proper fees for application and permits at the municipal or any other level, we just felt this was above and beyond the general fees that would be required normally of an company for what we’re doing,” company spokesperson Adam Rickel said from his office in Juno Beach, Fla.
He believes West Grey is unfairly targeting NextEra with unusually high fees.
“We’ve compared it to other fees that we’ve seen in other jurisdictions and there is not much clarity in the West Grey bylaw for backup for the fees.”
The request to quash the bylaw follows a warning by a company lawyer, who appeared before council on March 18 asking councillors not to approve amendments which included hefty fees under the municipal fees and charges bylaw for wind turbines.
Council passed the measure by a vote of 6-2.
Under the changes, industrial wind developers have to post a $100,000 performance bond for each turbine to cover costs that might accrue to the municipality during and after the introduction of the machines.
The municipality also requires a $6,500 permit for each turbine to carry out work along the municipal roadways. NextEra plans to bury its power lines carrying electricity between the project’s transformer station and Hydro One transmission lines. West Grey wants a security deposit of $20,000 for each kilometre of connecting line located on its property. That’s in addition to an entrance permit of $5,000 per turbine site.
Wind energy developers must also deposit $50,000 for a peer review of reports generated in the renewable energy application process. Other security deposits include $50,000 for use of a municipal roadway by heavy equipment during installation nd maintenance of the turbines. For a municipal road with a box culvert, the security deposit increases to $125,000 and it goes up to $200,000 for a municipal road with a bridge.
West Grey Mayor Kevin Eccles said in an interview following a special meeting of council on Monday that this is the first time West Grey has had an application for wind turbines and the municipality requires adequate fees to reflect the scope and size of the development.
“We’ve got fees and charges for any other development, it’s not like we’re just picking on wind turbines. This is the first one we’ve had for wind turbines and this is where we’re setting the fees,” said Eccles.
Following Monday’s closed door session, Eccles announced the municipality would not back down in the face of NextEra’s court challenge.
“It may be a David and Goliath scenario but I like the chances of David again,” Eccles said
The application filed in the Superior Court of Justice in Kitchener on June 6 alleges that the municipality doesn’t have the jurisdiction to assess such exorbitant fees that specifically target the wind industry.
The lawyer for NextEra argues the fees subvert the intent of the REA process, which has as its aims the facilitation of wind energy in Ontario, and frustrates the purpose of the provincial laws.
The court documents state the West Grey bylaw “sets out fees and security requirements that are unreasonable, unsubstantiated and punitive and contemplate significantly more in fees than any other fee requirements” in the fees and charges bylaw.
NextEra also claims the security deposits required bear no relation to the actual cost to West Grey and are in fact taxes intended to discourage wind projects.
Eccles said the deposits and securities are only intended to protect the municipality and will be returned once the project is complete – provided no damage has been done to West Grey roads and infrastructure.
He is disappointed that company wasn’t more prepared to compromise.
“They are more towards bullying than they are on compromising,” Eccles said.
Despite the legal wrangling, company spokeswoman Jose Hernandes said NextEra is prepared to work with West Grey to see the East Durham project through to completion.
The East Durham project will include up to 14 turbines in the Priceville area with a generating capacity of 23 megawatts of electricity an hour. According to the company website the estimated capital cost of the project is $67 million. Over the 20-year life of the project, it will generate $26 million in corporate income taxes and $1.5 million property taxes. Landowners who rent their land will be paid about $4.7 million.
A June 20 date has been set for lawyers to determine the initial hearing date for NextEra’s motion. Eccles said municipal lawyers need time to prepare a response to the application.