The Marcellus Shale and the Fairhaven Turbines
Credit: By KENNETH POTTEL | September 03, 2013 | www.southcoasttoday.com ~~
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In 2011, the town of Fairhaven entered into negotiations with Fairhaven Wind LLC. There was no public input and the contract was never given overview by anyone outside of the Board of Selectmen, Jeff Osuch, and town counsel Tom Crotty. The agreement that was reached failed to protect the town, and future money that the town would receive was based on the price of electricity. However in the contract the developer was guaranteed a 2.3 percent increase each year. The town was promised, but not in writing, a minimum of $200,000 a year and future profits for the town of up to $500,000 per year. This past year the town received $152,000. So the question that must be asked is why would the town leave itself to the mercy of market forces and what will happen in the future.
The recent developments in Pennsylvania, New York and Ohio may provide the answer for what Fairhaven can expect to earn from the turbines. In a region known as the Marcellus Shale, one of the world’s largest deposits of shale natural gas has been discovered and hundreds of wells have been and will be drilled in this region. The 400 year-old rock Marcellus shale formation is estimated to contain more than 410 trillion cubic feet of natural gas and could supply U.S. consumers’ energy needs for hundreds of years. There are plans to bring a pipeline of this cheap fuel to New England. Already we have started to see the results. Almost all of our electricity comes from plants that use clean natural gas and the price of natural gas has nose dived from $12 a cubic yard to just over $4 a cubic yard. This has resulted in NStar being able to continue to announce reductions in the price based on the cost per kilowatt-hour. There is every reason to believe that this will continue. What this means to Fairhaven is that the amount of money they receive from the resale of electricity on the grid will continue to stay the same or even decrease while at the same time the amount of money each year that they have to pay the developer will increase by 2.3 percent. So even if the price of electricity doesn’t change each year the amount that Fairhaven receives will decrease. Whether you support shale gas or not the boom is here to stay and this can only result in keeping prices of electricity at the current rate or even at a lower rate, which means less money for the town of Fairhaven, not more, as some have claimed. However, the developer is guaranteed in the contract to receive an increase each year, which over a period of time could result in a net loss to the town.
The new group Friends of Fairhaven Wind have made unfounded claims that the revenue in the coming years will increase, but the current trends do not support their claims. They also have repeatedly talked about Town Meeting voting for the turbines. When Town Meeting voted for the turbines they were told that they would bring in a minimum of $200,000 and up to $500,000. We now know this projection was not only off but was way off. Town Meeting was also promised that there would be no noise problems. So when a group makes claims that Town Meeting voted on a project, they need to include what information was presented to Town Meeting and if this information turned out to be accurate. It is important for any group that makes claims to do their homework and not just make claims without data to back this up. It is unfortunate that Friends of Fairhaven Wind have chosen to cherry-pick information and refuse to acknowledge the suffering of so many who live near the turbines.
Kenneth Pottel lives in Fairhaven.
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