August 31, 2013
Minnesota

Troubled wind project target of FBI scrutiny, industry criticism

Brett Boese | August 31, 2013 | www.postbulletin.com

ZUMBROTA – The New Era wind project appears likely to have its state-issued permits revoked this fall after missing two deadlines that required it to either begin construction or surrender its permits by Aug. 23, according to a Minnesota Public Utilities spokesperson.

That course of action could finally close the book on what’s been the most controversial wind project in state history.

The 78-megawatt project was first proposed in 2008 by National Wind. During the past five years, five lawsuits have been filed, ownership has changed hands twice, fines have been levied for illegal lobbying and – in the most recent development – the Federal Bureau of Investigation apparently has conducted interviews as part of a potential fraud investigation.

Four local critics of the $180 million wind project, representing opposition groups Goodhue Wind Truth and the Coalition for Sensible Siting, say they spent a January morning in St. Paul detailing their concerns to two FBI investigators. Developers have spent more than $15 million seeking state permits, according to a filing at the PUC, while local opposition has spent six figures in the protracted legal battle.

“(The FBI is) always interested to hear from citizens,” said Marie McNamara, a Goodhue farmer who co-founded Goodhue Wind Truth. “I remember them saying they were hearing concerns from other citizens across Minnesota (about the wind industry). Overall, we were concerned about a lot of shenanigans. We were concerned about the investments and money being lost by local people.”

Added Mary Hartman, a Rochester woman who attended the FBI meeting: “My impression was the FBI is very frustrated and they wanted to meet with us because we’ve been very active. They took all of our documents for their files.”

An FBI spokesperson declined to confirm or deny such a meeting took place, or if there’s an active investigation into New Era founder and CEO Peter Mastic. That’s standard operating procedure, according to the spokesman. However, critics note the Minnesota Attorney General’s Office filed a lawsuit against Renewable Energy SD, which allegedly bilked Minnesota farmers out of millions, just days after their meeting with the FBI.

If the FBI is investigating, it wouldn’t be Mastic’s first time facing legal scrutiny.

Mastic, who hasn’t responded to Post-Bulletin phone calls in 10 months, is the former CEO of Connecticut-based Noble Environmental Power. Noble Power was part the nation’s first attorney general’s investigation into wind companies in 2008 for alleged improper activities in New York. The issue was resolved without legal action when Noble signed a new “code of conduct” policy in 2009.

Mastic’s company also encountered legal issues in Michigan while developing the 42-turbine Ubly wind project. After years of controversy, during which Mastic worked as the project’s managing director, 20 residents filed a lawsuit in 2010 seeking damages for alleged adverse health effects,emotional distress and economic damages; Noble Power sold the project in 2008, but still was named in the lawsuit. The parties settled out of court in February 2012 for an undisclosed amount.

Mastic became the lead developer for the Goodhue County project when he was named National Wind’s president on Jan. 10, 2011. He purchased the project outright in October 2012 from Texas billionaire T. BoonePickens, becoming the sole owner and renaming it New Era.

While permitting has been stalled because of unresolved concerns about local wildlife, National Wind sued Belle Creek Township in December 2011 and filed a lawsuit against local farmers in May 2012 for attempting to cancel their participation contracts. Mastic’s New Era was then sued by Xcel Energy in June 2013. The Belle Creek issue was resolved without court proceedings, and Xcel recently reached an out-of-court settlement with New Era.

However, the legal matter with a handful of farmers – who reportedly constitute 25 percent of the project’s footprint – remains an unusual situation.

The local residents were personally served the legal paperwork about 15 months ago, but New Era has yet to file the matter in court. That legal uncertainty means farmers remain bound by the contract’s confidentiality agreement and, more importantly, still have an encumbrance on their property. As such, they can’t sell, subdivide,refinance or otherwise act without consent from New Era, according to the farmers’ legal counsel, Dan Schleck.

Joe Sullivan, regional policy manager for advocacy group Wind on the Wires, contends that the various legal situations “doesn’t give a black eye to the whole industry,” noting citizen support for renewable energy – and wind in particular – remains strong, according to a recent Minnesota Environmental Partnership survey.

However, one of the most experienced wind developers in the state believes that public perception of wind is “getting worse” because of the headlines created by New Era and Renewable Energy SD. Dan Juhl says he’s not received a single complaint from the public while developing 22 wind projects in his 35-year career with Juhl Energy, which is headquartered in Pipestone, Minn.

He pulled no punches in recent criticism of the New Era development.

“When we do them, we start at ground zero,” said Juhl, who has developed projects in Dodge Center, Lewiston and Altura. “The Goodhue project, the project that’s been five years in the meat grinder, they didn’t go to the community first. They just came in and said ‘We’re going to do this here.’ They didn’t get the community involved and ask ‘Do you want to be part of this? Where should we site (the turbines)?’

“They just went in like the big guys and bullied their way in. They said ‘This is where we’re going to build and you’re going to like it.’ Well, no they’re not. It’s human nature to fight that.”

URL to article:  https://www.wind-watch.org/news/2013/08/31/troubled-wind-project-target-of-fbi-scrutiny-industry-criticism/