AVON – After placing on hold a 201-megawatt wind farm near Avon last year, a group of investors is now proposing 13 smaller projects in Bon Homme and Charles Mix counties.
Prevailing Winds LLC has filed paperwork with a federal agency regarding the new projects, according to the state Public Utilities Commission (PUC).
“The projects range in size from 6.8 megawatts to 20 megawatts,” PUC chairwoman Kristie Fiegen said Friday.
On Dec. 27, the PUC received copies of 13 forms which Prevailing Winds filed with the Federal Energy Regulatory Commission (FERC), Fiegen said. Prevailing Winds is seeking certification for a small-power production or co-generation facility, she added.
Prevailing Winds registered the 13 wind projects with FERC under different legal entities, Fiegen said. The investors are seeking qualifying facility status under the Public Utilities Regulatory Policy Act (PURPA), she added.
“Through PURPA, qualifying facilities (QF) – such as small wind power production facilities generating 80 MW or less – have the right to sell their power, and utilities have the obligation (at a certain point) to buy the QF power at the utility’s avoided cost,” she said.
On Saturday, Prevailing Winds chairman Ronnie Hornstra confirmed to the Press & Dakotan that his group had filed the FERC request and the investors are still pursuing wind projects. The group had withdrawn its previous application for a state permit without prejudice, meaning it could still seek a state permit without a loss of rights or privileges.
As a qualifying facility, Prevailing Winds could benefit others in a number of ways, Hornstra said in a follow-up email.
“Subsidiaries of Prevailing Winds have offered to sell energy, capacity and renewable energy credits to certain rural electric cooperatives in South Dakota,” he said. “These offers will not force the cooperatives (in certain circumstances) to purchase the energy, capacity and renewable energy credits from Prevailing Winds’ subsidiaries.”
PURPA was enacted in 1978 as part of the National Energy Act, Hornstra added.
“PURPA is meant to promote energy conservation by reducing demand and (to) promote greater use of domestic energy and renewable energy by increasing supply,” he noted.
Prevailing Winds’ proposed projects won’t harm rural-electric cooperatives or other energy providers, Hornstra said.
“It only creates an opportunity for the cooperatives to purchase local renewable energy that would reduce cooperatives’ energy costs and would be generated right here in South Dakota.”
Prevailing Winds’ projects would provide energy at a cost savings, Hornstra said.
“The cost of the energy, capacity and renewable energy credits offered by Prevailing Winds’ subsidiaries to the cooperatives is less than half the price of what the cooperatives are currently paying for just energy and capacity alone, without any renewable energy credits,” he said.
Prevailing Winds still strongly believes in a wind project for the Avon area, which could benefit the entire region. Hornstra said. The limited liability corporation has run into “rumors and misinformation” regarding its previous work, he said.
Investors previously worked with the recently-constructed Beethoven wind project near Tripp, completed in May 2015. NorthWestern Energy purchased the 80-megawatt wind farm from BayWa r.e. Wind LLC for $143 million. The purchase agreement included 43 turbines and the rights to a 50 megawatt expansion site adjacent to the existing facility.
More recently, investors worked with the proposed Prevailing Winds project in the Avon area. The plan called for 100 turbines covering approximately 36,000 acres in Bon Homme and Charles Mix counties.
The 201-megawatt wind farm would have generated as much as 860,000 megawatt-hours annually of electric power. The energy would have been used for residential, commercial and industrial consumers within South Dakota and the Southwest Power Pool.
Prevailing Winds would have generated enough power annually to meet the current needs of 10 rural electric cooperatives the size of Bon Homme Yankton Electric, according to project manager Roland Jurgens.
However, the Prevailing Winds board withdrew its state application last August after a public hearing in Avon. The four-hour meeting drew about 300 people with strong feelings on both sides of the issue. Proponents pointed to economic benefits, while opponents brought health, aesthetic and environmental concerns.
Sioux Falls attorney Lee Magnuson, representing the wind farm, said Prevailing Winds investors found considerable opposition to the project during the PUC hearing in Avon.
In addition, approximately six dozen individuals and organizations sought status as intervenors in the permitting process. As intervenors, they would hold special rights for participating in the process.
The motion to withdraw the application cited misinformation surrounding the project. The organizers said they plan “to better inform the community on the wind project and allow Prevailing Winds to revisit its options regarding the project.”
The investors took the controversy into account in making its decision, Jurgens told the Bon Homme County zoning board last September.
“We don’t want to split the community. That’s not good for the community,” he said at the time. “But (the wind farm) is still out there. Our board is getting out more information on the project and seeing what we have for options.”
Should Prevailing Winds move forward, the project could look different than the one that was under consideration, Jurgens said at the time. A reconfigured wind farm could generate the same amount of power with fewer turbines by increasing the rotor size, he said.
In turn, the larger turbines would each likely need more room to generate needed wind power, he said.
Prevailing Winds would continue to follow all current state and county regulations, Jurgens said. Regardless of whether it pursues a state permit, the wind farm would need a conditional-use permit from Bon Homme County and a building permit from both Bon Homme and Charles Mix counties.
“The people who finance these projects want to meet those standards,” Jurgens said. “They don’t want to see things get stalled. Nobody wants to spend this kind of money and have headaches.”
Jurgens told the Press & Dakotan at the time that the Prevailing Winds facility would likely stay in the same proposed location because of the favorable winds and terrain.
In addition, he said the investors didn’t intend to reduce the size of the Prevailing Winds projects or break it into smaller parts in order to fall below the threshold requiring PUC approval.
“The PUC permit and other regulations are governed by the size of the (generating capacity), not the number of turbines,” he said at the time. “The number of megawatts won’t change for this project.”
The PUC may retain a role even with the smaller projects, Fiegen said Friday.
“The South Dakota PUC has siting authority for wind energy facilities with a capacity of 100 megawatts or more,” she said. “However, the 13 Prevailing Winds projects that are 20 MWs or less may still need a siting permit from the South Dakota PUC depending upon the management and configuration of the wind turbines, power collection systems and electric interconnection systems. “
The PUC role will depend on the wind project itself, Fiegen said.
“Without knowing the specific details of each project’s design and how each project will be operated, it is not certain at this time that a permit from the PUC will be, or will not be, required,” she said.
“County regulation varies across the state. However, smaller wind projects still need a permit from most counties.”
Prevailing Winds’ charter contains a mission statement dedicated to sustainable, long-term and environmentally sound wind projects, Hornstra said. The organization seeks the social and economic improvement of rural South Dakota.
“Our mission statement is the primary reason we are making these offers to the cooperatives,” he said, “to extend our projects economic benefits to as many South Dakota residents as possible.”
The proposed wind energy projects would fulfill those goals, Hornstra said.
“Prevailing Winds and its subsidiaries truly believe that if this offer is accepted, it would save tens of thousands of South Dakota residents money on electricity costs, and it would certainly create a needed economic boost to rural South Dakota through wind energy,” he said.
The proposed projects would not seek to drive up costs or create unneeded purchases through mandates, Hornstra said.
“Prevailing Winds and its subsidiaries have no intention to impose high energy and capacity prices on any cooperative or force any cooperative to take more energy than is practical,” he said.
“Our goal is to produce energy and capacity that is home grown here in South Dakota that will reduce rural electrical cooperative members’ energy costs for the next 25-plus years.
“After all, Prevailing Winds, LLC is owned by 160 South Dakota members, and almost all of those members are customers of South Dakota electrical cooperatives, also!”
The FERC Forms 566 information can be reviewed on the PUC’s website at: http://www.puc.sd.gov/Dockets/Electric/2016/Informational/default.aspx. See filings number 2016 Info EL17 through 2016 Info EL25.
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