Big bucks for Loyalist Twp for wind farm? Or crumbs off the developer’s table?

Loyalist Township

Loyalist Township’s Deputy Mayor is a cheap date

The CKWS Newswatch team reported that “Loyalist Township stands to rake in some big bucks once 26 wind turbines are built on Amherst Island.”

Two key agreements with Windlectric have been authorized by the township related to the 74.3 MW (megawatt) project that will see 26 turbines erected on the island. While the project has been authorized by the Ministry of the Environment and Climate Change (MOECC), the Association to Protect Amherst Island has appealed the approval.  The start date is therefore unknown as the developer must await the ruling of the ERT (Environmental Review Tribunal) which is not expected until the early Spring of 2016.

The term “big bucks” is relative to the size of the project and, perhaps, to the recipient of those “bucks”! In this case the community benefit agreed to is $500,000 annually for the next 20 years. On the surface it sure sounds like big bucks, but the really big bucks will wind up in the pockets of Windlectric’s shareholders.

Here’s how.

If the 74.3 MW capacity development operates at the expected average of 30% of its rated capacity, it should produce almost 2 million megawatt hours (MWh)of electricity and deliver that to Ontario’s grid — whether it’s needed or not. The math is simple:74.3 X 30% X 8760 (hours in a year) = 1,952,604MWh.

We should assume the Windlectric contract was executed prior to the slight downward movement in the feed-in-tariff (FIT) pricing, so for each MWh produced, Windlectric will be paid $135.00/MWh. If you do the math on what their annual revenue will be you might be surprised at the really “big bucks” they will receive!  The gross revenue for Windlectric will be about $26.4 million annually (1,952,604 MWh X $135 = $26,396,010) which most of us would consider “big bucks”!

Loyalist’s ‘big bucks’ is not even 2% of the developer’s revenue

The township will get $500,000 of the $26.4 million which amounts to 1.9% of the takeaway by Windlectic.   If the Amherst Island residents are, as the Deputy Mayor suggested, put “at ease” they shouldn’t be; council should have bargained much harder.

As one resident suggested, the “big bucks” may not be sufficient to even repair the damage to Amherst Island’s infrastructure after construction. And that doesn’t even consider the devaluation1. of property close to the turbines, destruction to migratory birds, plant and animal life, and of course to the 15 to 20 % of people who may feel the effects of the audible and inaudible noise on their health.

What a cheap date!

©Parker Gallant,  December 21, 2015

  1. Property devaluation will lead to reduced assessments and an eventual realty tax loss to the township.

The opinions expressed are those of the author and do not necessarily represent Wind Concerns Ontario policy.

Comments

Greg Latiak
Reply

One other small detail – what would Loyalist get if these projects were taxed at the same rate? And not the Green Energy statutory cap, which I recall was 60,000/turbine vs the millions they actually cost?

Parker Gallant
Reply

Greg, they are only taxed on $40,000 as decreed by Dwight Duncan (instructions to MPAC) as one of his gestures to the wind industry when he was Finance Minister. He was just appointed by Justin “sunny days” Trudeau as the Chair for the Windsor Detroit bridge so will be handing out more favours to his Liberal friends

R Budd
Reply

I believe that Ontario’s turbines are still assessed at a value of $40,000/mw. So a 2.5mw, for municipal tax purposes, is valued at $100,000, or about as much as a good sized drive shed, or 25% of a house, despite its real value of ~$4million.
I believe that had been in place long before the GEA, back to the day when the first projects hoped to get $.08/kwh. Back then CANWEA was boasting that Ontario had the cheapest tax rates for wind projects.
Nothing changed when FIT rates ballooned to $135/kwh. No sense wasting good money on rural municipalities the Liberal/corporate cabal figured. And they get away with it still.

Barbara
Reply

WikiLeaks on the DRIC/Detroit River International Crossing are online. Another can of worms.

Raymond Beaudry
Reply

Hello Greg, here is some info I sent to council and others back in Jan 2014. If Northland Power Inc paid the full tax rate it would have probably cut the tax rate by 1/2 for township residents.

MPAC Municipal Taxes and Potential IWT Revenue;

This is a taxpayer and ratepayer issue.
In our township, one hundred acre local farm lots and managed wood lots are assessed at approximately $26,225 that contribute to around $81 in taxes.

Point;
The wind industry (Northland Power) pays the taxes on land it has options for in leases. Some lands since 2003 though I expect still rated as farmland.
Northland Power states on their website these turbines are 2.5 mw Also on Northland Power’s website these turbines are rated by General Electric at 2.85 MW.
This should be an increase in assessed value of $14,000 at the appropriate industrial rate.

Wind turbine leases encompass the entire 100 acre lots where the lease holder (industrial developer) acquires the rights of use. Perhaps the 100 acre lot, less the wind turbine footprint of 4.94 acres should be assessed and taxed industrial also.

Another option is;

Wind Turbines require infrastructure; wide right of ways, collector lines, wide access roads, transmission lines. All of this supporting infrastructure should be assessed at the industrial rate and the balance of the farm lots remain at the farm assessment rate. Either way in the above scenario it creates more income for our municipal taxes.

Buildings and distribution stations for the wind farm may already taxed appropriately but requires verification.

The township does not receive the taxes when the turbines are erected. It seems they are taxed only after the project is deemed complete. This could be up to six months or more of lost tax revenue for our township.
(Seeking Clarification)

Turbines are assessed at $40,000 per megawatt which includes the 2
hectare land base.4.94 acres . Homes are paying more taxes than a multi million dollar industrial wind turbine generator.
They should be assessed at the full value as in any industrial or house
construction.

Another subsidy the wind industry receives is the assessed value of the
turbines. It is set at $40,000 per MW times the 2.85 MW is only $114,000 assessment and not the 2 to 3 million dollar value or so.

$114,000 assessed value times industrial rate of .03087360 is $3,519.59
of taxes.
A 2 million dollar turbine, equals $61,747.20. Diff – $58,227.61
A 3 million dollar turbine, equals $92,620.80. Diff – $89,101.21

This 24 turbine project at even the lower 2 million dollar turbine cost
should have rather than the $84,470.16 in tax revenue for the township,
it should be above $1,397,460.24.

This influx to the tax base would probably lower the tax bills for
everyone in this township.
The Feed In Tariff for this project is $150 for each MW hour or 15 cents
per kwh and under these FIT contracts they will be paid by all
electricity users whether the province requires the generation or not.
They will get paid to not even generate. Townships should be receiving
their fair share to pay for provincially downloaded costs and rising
expenses that affect local temporary and full time employment and
operating expenses.

Requests to implement fair taxation in relation to renewables and in
particular industrial wind turbines should be sent by our town councils
to the appropriate ministries.

Raymond Beaudry

Barbara
Reply

Subsidies to “kick-start” an IWT industry in Ontario.

End result will be lowering the standard of living for all Ontarians.

Barbara
Reply

WikiLeaks Cable, April 29, 2009

6.
“Emera, the parent company of Nova Scotia Power and Bangor (Maine) Hydro, announced on April 23 that it has entered into a partnership agreement with Algonquin Power Income Fund (APIF) of Ontario to invest in utility infrastructures and renewable generation facilities.”

http://www.wikileaks.org/plusd/cables/09HALIFAX25_a.html

APIF is now Algonquin Power & Utilities.

Last check revealed that Emera Inc. owns some 50 million shares of Algonquin but this number may have changed by now.

Richard Mann
Reply

Here is a “time line” showing the history of Wind Turbine Noise problems, going back as far as 1979. Each entry provides documentation:
http://cdn.knightlab.com/libs/timeline/latest/embed/index.html?source=0Ak2bgr7C0nhPdGR3S1lEekU3T3p4ZDhUNDdRV2Y2ZkE&font=Bevan-PotanoSans&maptype=toner&lang=en&height=650

1979 “First complaints received from a dozen families within a 3km radius of turbine”.
1981 “Wind turbine operation creates enormous sound pressure waves”
1982 “Closed windows and doors do not protect occupants from LFN”
1982 “NASA research on human impacts provided to wind industry”
1985 “Hypothesis for infrasound-induced motion sickness”
1987 “Wind industry told that dB(A) unsuitable to measure LFN emissions from wind turbines”

2004 “Wind industry knows noise models inadequate” (from Vestas)

2011 “Vestas knew that low frequency noise from larger turbines needed greater setbacks”

Sommer
Reply

How is it possible that these Municipal ‘leaders’ could be so blind to the realities that other communities have faced/are facing.
This surely is neglect of duty to protect the citizens of their municipality.

At this point there is far too much information they could have/should have/should be learning in order to prevent this level of harm to their communities.

Barbara
Reply

WikiLeaks, Cable, Jan.26, 2010

‘As BC Positions To Become A Clean Energy Leader …’

7.
“Feed-in tariffs set a guaranteed price paid by the utility for renewable power (set higher than the market rate), typically combined with ensured access to the electricity grid.”

https://wikileaks.org/plusd/cables/10VANCOUVER42_a.html

B.C./Ontario

“combined with ensured access to the electricity grid”

Linda
Reply

I suspect the 74 MW refers to the Installed Capacity – what the turbines are capable of producing if they were to generate at full capacity for 24/7. IC will never be achieved with wind, solar or hydro. The actual power produced by a wind turbine will likely be more like 30 to 40% of IC – which will reduce all the numbers significantly.

Barbara
Reply

Wikileaks, June 2, 2006

‘Update On Hydro Quebec’s Energy Plans’

2.
“Nadeau stated that the public’s hopes about the contribution of wind power are frankly unrealistic, but HQ cannot make this view known publicly for fear of being labeled anti-environmentalist.”

https://wikileaks.org/plusd/cables/06MONTREAL622_a.html

“for fear of being labeled anti-environmentalist” !

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