Wind farm tax plan discussed

By

News

May 10, 2017 - 12:00 AM

If plans continue on track, wind turbines in northeast Allen County will be generating electricity by October 2018. Allen County, however, will not reap a payment in lieu of taxes (PILOT) that has been bandied about.
A delegation from EDP Renewals had a lengthy discussion with Allen County commissioners Tuesday, and toward its end Rorik Peterson, EDP’s associate director of development, proposed the company pay the county an annual PILOT of $200,000 for 10 years.
That is considerably less than what Coffey County receives in annual payments — the first was nearly $500,000 — for a PILOT from a wind farm near Waverly.
Peterson had set the stage for what Allen County will be offered with two-fold reasoning.
First, revenue from power sales has decreased in recent years as the cost for fossil-fuel production, primarily natural gas, has dropped. More to the point is if the EDP farm would be the first in Kansas not to receive a lifetime property tax exemption. Now, the exemption is for 10 years after which the EDP property taxes could be expected to soar to about $2.4 million, with state assessment.
“I was thinking a little higher” for the PILOT, Commissioner Jerry Daniels said, but allowed he understood “the difference with the wind farm at Waverly.”
“I think it’s in the ballpark,” Commissioner Tom Williams said. “I wish it were more, but I also want you here.”
“We’re proposing $1,000 per megawatt of production (for Allen County),” Peterson said. The plan is for 55 or so turbines to generate 200 megawatts. Coffey County has 95 turbines of inferior technology compared to those that would come to Allen — “Wind technology improvement has been extreme,” Peterson said.
The wind farm would be contained in a huge square of land bounded on the south by U.S. 54, on the east by U.S. 59, on the north by the Allen-Anderson counties line and stretch far enough west to encompass about 22,000 acres. To date, EDP has acquired options for 17,000 acres.
“That’s enough for what we plan to do, but we’d rather fill in the rest” of a mildly patchwork acreage, Peterson explained.

THE DISCUSSION began with generic data, in answer to commissioners’ questions.
The average lifespan of a wind farm — although they are new enough in the industry not to have a great track record for comparison — is 30 years. The first in Kansas went online in 2001 and still is generating.
The marketing of locally generated power is underway with several power companies, and Peterson is confident its sale won’t face any hurdles.
Cost is front-loaded with construction, including large stabilizing bases requiring 500 cubic yards of concrete. That’s important locally with Kansas’ only two cement plants in Humboldt and Chanute and ready mix plants in Iola and Gas. While it’s up to the construction company where concrete is obtained, Peterson said local vendors likely would be involved.
Initial design is expected to start this summer. If all the pieces, including approval of a zoning variance and commissioners’ approval, fall into place, construction would start next March and completion could be expected within seven months.
The construction would entail 200 to 250 workers, who would “rent rooms, eat in restaurants and buy things in the area,” Peterson predicted. As many as 20 employees would maintain the windmills once generation began. Peterson said several post-secondary schools offer courses in wind generation technology, and it’s “one of the fastest growing occupations in Kansas.”

Related
November 22, 2017
November 3, 2017
October 27, 2017
August 11, 2017