Isabella County entered into an agreement Tuesday night that is intended to pay the bill when it comes time to tear down the turbines in a wind farm in the north-central part of the county.
Under the agreement, Isabella Wind, LLC, will take out a $200,000 bond for each turbine it builds. The company is currently planning to build up to 136 turbines, a number scaled back from the 157 it was permitted to build by the county’s planning commission in January.
Isabella County will take the bonds and hold onto them. When the turbines need to get torn down, that’s where the money will come from.
It’s not an upfront payment of $27.2 million, county development director Tim Nieporte said after the meeting. The bonds function more like an insurance policy, where the turbine owners will pay a third-party to back the costs of decommissioning.
At the county commission’s Tuesday work session, William Fahey, of Fahey, Schultz, Burzych & Rhodes PLC called the county’s bond requirements specifically and the plan both the strongest in the state.
Setting aside the money, he said, is “a very important financial issue.” It’ll make sure that decommissioning turbines won’t happen on the backs of taxpayers or property owners, or that the turbines will remain standing as derelict eyesores.
The $200,000 figure was based on similar agreements inked in other counties. A wind farm in Tuscola County was bonded out at $191,000 per turbine, Nieporte said.
The issue of decommissioning came up at the Jan. 31 special use permit hearing, when some people said they were concerned that not enough was being done to ensure that when the wind farm reached the end of its operational life that they could be taken down.
At that hearing, county development director Tim Nieporte said that the county zoning ordinance required the county to have an agreement in place requiring wind turbine owners to take out bonds to ensure for their removal from private property.
Tuesday’s deal was the final expression of that.
Albert Jongewaard, development director for Apex Clean Energy, said he is unsure where they will take out the bonds. It could be either some kind of financial institution or they could purchase them off the open bond market.
Part of the agreement also requires that if someone else buys the farm, they are required to also put up $200,000 per turbine to cover decommissioning costs. According to documents Nieporte provided commissioners about the agreement, DTE is contemplating purchasing the wind farm once construction is completed.
County commissioners unanimously voted to accept the decommissioning agreement.
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