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Hancock County reaches settlement over wind farm payments it said were too small

Hancock County has reached a preliminary agreement in a dispute with a wind energy firm over community benefit payments that the firm had agreed to make to the county.

The county filed suit in the fall against Hancock Wind, a subsidiary of Novatus Energy, after the company made annual payments to the county that were less than what the county expected.

With the tentative agreement, which was reached after the parties went to mediation last week, Hancock Wind can continue to pay the county at a rating generating capacity of 51 megawatts, which amounts to an annual payment of $188,853, but also will pay an additional $7,500 each year in tangible benefits to communities in Hancock County, according to information released Tuesday by county officials.

Hancock County had expected annual payments from the wind firm based on a higher generating capacity, which would work out to almost $19,000 more in payments to the county each year over the course of a 20-year contract.

The county had signed an agreement in September 2014 to receive annual community benefit payments from First Wind, Novatus’ predecessor. That agreement called for the company to pay the county $3,703 annually for each megawatt of the project’s overall generating capacity, according to documents filed with the state’s business court in Portland.

The county’s position was that the 17-turbines in townships 16 and 22 northeast of Ellsworth each had a capacity of 3.3 megawatts for a total capacity of 56.1 megawatts, which would result in an annual payment of $207,738.30. The company countered that the power-converter system on each turbine actually limits their total output to 51 megawatts, resulting in a contractual annual payment of $188,853.

The county filed the lawsuit after the 2016 and 2017 payments it received from Hancock Wind combined were $37,770 less – $18,885 for each year – than what it said it was owed. Had the county not challenged Hancock Wind’s position, over the 20 years of the agreement it would have received $377,700 less than what it said the contract called for.

As it now stands the company will give the county $3.8 million in community benefit payments over the 20-year lifespan of the original agreement, in keeping with Hancock Wind’s position. But the wind firm also will pay out an additional $135,000 over 20 years that will go directly to local communities, rather than being directed through the county. The amount paid annually to the county will not be reduced for any reason but if the facility’s megawatt output increases, the annual payment to the county will increase accordingly, at the same rate of $3,703 per megawatt.

Antonio Blasi, chairman of the county commission, declined Tuesday to provide additional comment on the agreement.

Dan Mitchell, an attorney representing Hancock Wind, said Monday in an email that last week’s settlement with the county “was a good result for both sides” but declined to comment further.