MPAC misled Ontario on wind turbine neighbour property values: Conroy

“Anyone with eyes” can see wind turbines impair property values… why does an Ontario government agency insist the opposite is true?

The Times

The Wellington Times, April 22, 2016

Misled

By Rick Conroy

One does not establish a dictatorship in order to safeguard a revolution; one makes the revolution in order to establish the dictatorship.- George Orwell

They didn’t come to talk about industrial wind turbines. Rather, the two emissaries from the Municipal Property Assessment Corporation (MPAC)—an agency of the province of Ontario—came to apologize.

MPAC is the government agency that determines the value of your home or property for municipal taxation purposes. They know they do a poor job of it. They have such low confidence in their ability to assess the value of your home, particularly in rural, heterogeneous neighbourhoods, one phone call is often all it takes to have an assessment reduced.

So the MPAC folks came to Shire Hall to say they are sorry and want to do better. Part of a dog-and-pony-apology tour across Ontario. They came with plans to improve the way they, and clerks in municipalities across the province, might work together better.

County council members, however, wanted to know about industrial wind turbines. Specifically, they wanted to know the impact on property values of 50-storey machines erected in a scenic rural shoreline. The MPAC folks were prepared for the question. They get it a lot.

Leaning heavily on MPAC’s own study based on 2012 data, the representatives assured council industrial wind turbines nearby had “no statistically significant impact on sale prices.” When it conducted the analysis, the provincial agency knew its findings would meet with a skeptical reception, so it hired an American consultant to examine the data too. It, however, found a statistically significant impact lowering the sale prices of homes near industrial wind turbines, but that the impact was small.

That was the information shared with council. Council believed it was true.

Ed and Gail Kenney have been battling MPAC for seven years. In 2008, the couple’s Wolfe Island home was valued at $200,000. The following year, 86 industrial wind turbines sprouted around his home. Fluctuating pressure caused by the turbines makes Ed uncomfortable and edgy—he finds it difficult to sleep. Yet he doesn’t want to move.

That same year MPAC determined the value of the Kenneys’ home had risen to $375,000—driving their municipal taxes much higher. They appealed. If anything, the value of their home was less because of the turbines, not more. It took several years and a small fortune, yet they lost their appeal.

“The board found that based on the evidence, in this case, there appeared to be no evidence of any negative impact to the value of the property,” concluded the MPAC appeal panel.

The case raised serious questions about how MPAC conducts its evaluations. The hard data appeared to contradict its conclusion. A small corps of amateurs pored over the data. They found a correlation between a decline in sale prices and proximity to industrial wind turbines. But they were just raising more questions. There was no hard evidence or academic research contradicting MPAC. Until now.

A new study prepared by Clarkson University and Nanos Research paints a very different picture of what happened as a result of the industrial wind turbines on Wolfe Island.

The Clarkson-Nanos study concludes that a massive wind project proposed for Galloo Island— part of a chain of islands that includes the Duck Islands stretching from Prince Edward Point to Henderson, New York—will likely depress property values of homes with a view of the turbines. The researchers calculate the impact is likely to be more than $40 million while providing the community with little value in return.

But surely the most surprising aspect of their research, for Ontario residents at least, was what they learned about property values directly across from Wolfe Island.

Clarkson-Nanos found that properties with a view of the western side of Wolfe Island, in and around Cape Vincent, prior to turbines being built, commanded a premium of about 10 per cent relative to similar properties. After the turbines were constructed, however, they found a “strong negative impact” on property values. Further, their analysis determined that industrial wind turbines reduce property values on the American mainland by about 15 per cent.

So let’s get this straight. MPAC and its consultant couldn’t detect a significant impact on property values on homes in the shadow of these looming mechanical giants—yet across the channel, an independent research body found homes are worth far less because their view includes industrial wind turbines.

It is obvious to those with eyes that industrial wind turbines impair property values. It is surely why the province wouldn’t tolerate an appeal based on economic or property losses as a result of an industrial wind project located nearby.

Yet the provincial government continues to compel its agencies to tell the public a different story.

The last shreds of credibility MPAC may have once had, now lie in tatters.  …

 

Read Rick Conroy’s stunning conclusion and the rest of the story here.

 

Rent rates for coastal properties in NC drop with wind turbine views: economic study

“…not a scenario for which respondents would be willing to pay more to rent a home with turbines in view …”

Image result for pictures north carolina beaches
Photo Destination 360.com

New York State University

Centre for Environmental and Resource Economic Policy

The Amenity Costs of Offshore Wind Farms: evidence from a choice experiment


Abstract:

We conduct a choice-experiment with individuals that recently rented a vacation property along the North Carolina coastline to assess the impacts of a utility-scale wind farm on their rental decisions.  Visualizations were presented to survey respondents that varied both the number of turbines and their proximity to shore.  Results indicate that there is not a scenario for which respondents would be willing to pay more to rent a home with turbines in view as compared to the baseline view with no turbines in sight. Further, there is a substantial portion of the survey population that would change their vacation destination if wind farms were placed within visual range of the beach.  The rental discounts required to attract the segment of the survey population most amenable to viewing wind farms still indicate that rental value losses of five percent or more are possible if a utility-scale wind farm is placed within eight miles of shore.

Download Document

 

 

The wrong people profit from wind farms, says homeowner

‘Grossly unfair’ for government to steal our futures, says Kemptville letter writer

Nowhere near Toronto and Queen's Park: wind power projects reduce rural property values
Nowhere near Toronto and Queen’s Park: wind power projects reduce rural property values

Ottawa Citizen, March 16, 2016http://ottawacitizen.com/opinion/letters/your-letters-for-wednesday-march-16-water-windmills-women

Re: New Eastern Ontario wind farms a betrayal, mayors near Ottawa say, March 11.

Home ownership is the biggest investment a person can make.  Many people depend on the value of their homes to underwrite their futures, whether it be generating capital for their kids’ educations, serving as a stepping stone to a better home, or even financing their retirement. Folks who choose to live in rural areas already face challenges in marketing their properties, compared to their city cousins.

With the looming prospect of giant wind farms in their backyards, they are now told they must accept unanticipated decreases in their property values without complaint because “the needs of the many outweigh the needs of the few.” Rural dwellers also pay comparatively huge electricity transmission costs – and, ironically, will likely continue to do so even with the gargantuan structures towering over their homes. It is also likely that their municipal tax burden will not be adjusted to reflect the decrease in their property values.

It is grossly unfair for an all-powerful government authority to callously steal rural homeowners’ futures so that a corporate entity can profit from huge government subsidies and distant cities can meet their rapacious energy consumption needs. At the very least, these folks should be compensated for their loss.

Perhaps a good starting point would be to waive the “welcome tax” levied by the provincial government on home sales for those located within a set radius of wind farm installations, thus boosting the marketability of affected properties. Another measure would be to give these homeowners a discounted rate on their electric bills, or even the same remuneration provided to the farmers who profit from having such installations on their lands.

Burton Blais, Kemptville

 

Community discontent with wind power projects Fulbright lecture today

[Photo Clarkson University]

Understanding the Varying Impacts of Cross-Border Wind Development

Wind power is among the fastest growing energy sources in the world today, and is widely viewed as a substantial part of a clean energy future. However, implementation of wind energy is often controversial in areas where it is proposed, and concerns are often raised regarding potential negative impacts on local communities, including impacts on health and on property values. Some of these negative impacts may be offset by compensatory payments made by wind developers to both individual landowners who let out their land for the development and to communities. Additionally, host communities often have a say in approving the development or setting parameters. However, if the development is near borders between municipalities, states, or even countries, it is often the case that one or more jurisdictions will not have an opportunity to set such rules or demand compensation, but will, nonetheless, face some costs or impacts from the development. In such a situation, we would expect the property value impacts of a wind facility development to vary across these borders. We explore exactly this situation at the border between Canada and the United States in the Thousand Islands region of the St. Lawrence River.

Panelists

  • Dr. Stewart Fast, Positive Energy project and Institute for Science, Society and Policy, University of Ottawa
  • Tom Levy, Director of Utility and Technical Affairs, Canadian Wind Energy Association

Speaker

Martin D. Heintzelman is the Fulbright Visiting Research Chair in Environment and Economy at the University of Ottawa’s Institute of the Environment. He is on partial leave until April from his post as Associate Professor and Fredric C. Menz Scholar of Environmental Economics at Clarkson University, as well as Director of the Clarkson University Center for Canadian Studies. At Clarkson, he is jointly appointed in the School of Business and the Institute for a Sustainable Environment. Martin has an M.A. and a Ph.D. in Economics and an M.S. in Natural Resource Policy and Behavior from the University of Michigan as well as a B.S. in Economics from Duke University.

Venue:
Desmarais Building (55 Laurier E), room 12102
Event-Date:
Thursday, January 28, 2016 – 04:00 to 06:00

See more and to register here

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.

Eastern Ontario wind farms: enjoy the horizon while you still can

 

From Farmers Forum, August 4, 2015

Community opposition to industrial-scale wind power mounting

Excerpt from “Eastern Limits” by Tom Van Dusen

I’m not sure what it is about North Stormont Township but wind power developers seem to love it.

Their calculations must have discovered more forceful winds than normal stirring the township. On the surface, though it seems no more or less windy than any other rural municipality.

In increasing numbers, developers have been wafting through the township looking for prime sites* to erect their industrial turbines. As in other communities where they’ve landed, their efforts have been the subject of increasing protests, petitions, and testy meetings.

Correctly gauging the way the wind is blowing on the issue, township council has just taken a stand against turbines and their proponents…for what that’s worth. With the provincial government relentlessly pushing wind power, it’s probably not worth much.**

Mayor Dennis Fife has explained that too many ratepayers are against wind projects for council to reasonably support them. Fife has expressed his personal opposition, claiming wind will never match nuclear power generation.

Typical of disgruntled ratepayers is Roger Villeneuve who worries that towers “much taller than any tree I’ve ever seen or will ever see” will soon dominate the local landscape.

…Council was helped along in its decision by Concerned Citizens of North Stormont which circulated an unwilling host petition, demanding that elected representatives back it at a meeting July 28. They did.

In explaining its opposition the citizens’ committee cited the loss of property values and prime agricultural land, increased hydro costs to cover wind power expansion, environmental impact on birds and bats, health issues related to pulsating noise and shadow flicker, and eventual decommissioning costs.

…Developers have been through all this before, in several other Ontario municipalities where they’ve landed. You see, they have carte blanche from the province under the Green Energy Act, trumping any local motions, opposing them. Projects are decided by the province’s Independent Electricity Service Operator [sic–it is “System” Operator] (IESO) with little regard for local concerns.***

…a growing number of wind power opponents are urging councils to use other tools at their disposal…one suggested option is refusing a bylaw to permit road access to turbine sites. ****

“Enjoy the natural horizon while there still is one,” says ratepayer Roger Villeneuve.

Wind Concerns Ontario notes:

* What they are looking for is willing landowners. Wind doesn’t really have much to do with it.

** The Not A Willing Host declaration stems directly from a statement by Premier Kathleen Wynne that she wouldn’t force wind power projects on communities that weren’t willing. Her failure to honour her word is underscored by the 89 (soon to be 90?) communities that have protested by municipal resolutions.

*** This is true but the failure of a developer to gain municipal support does not help them in a successful bid. Bids without community support are ranked lower.

**** This is not actually a valid option: several communities have tried this already and what happens is, the developer goes to the Ontario Energy Board which then grants permission to use road allowances. The municipality is then left without a road use agreement and possibility of compensation for the sometimes considerable damage to public roads.

 

Residents to N Frontenac and Addington Councils: don’t abandon us in wind farm fight

Carmen Krogh: strong evidence that Ontario setbacks don't work
Carmen Krogh: strong evidence that Ontario setbacks don’t work

Frontenac News, June 4, 2015

Fears about declining property values, health concerns, and environmental protection were among the hot topics discussed at two meetings, a combined meeting of North Frontenac and Addington Highlands Councils on May 11, and a packed public meeting in Denbigh on the afternoon of May 30. The meetings concerned the Northpoint II Wind Energy Center, a proposal by Nextera, a subsidiary of Florida Power and Light, to install approximately 100 wind turbines in Addington Highlands and 50 wind turbines in North Frontenac.

A common concern for many of the folks in attendance at both meetings was property values.

Local realtor Chris Winney spoke about her fear that building a wind farm in the area would drastically hurt real estate values.

“It can be on somebody else’s land and still have an effect on your property. It just cuts down on the number of people who are going to be interested in buying it. If there are fewer people interested in buying it then the value goes down” Winney told council.

Construction on the proposed project, if their bid is successful, is expected to take less than a year to complete, following a longer permitting process that Nextera would have to go through. Ben Faiella, a representative from Nextera was in attendance at the Flinton meeting and explained how Nextera had built a 92 turbine wind farm in Southwestern Ontario last year in about 6 months.

At the Flinton meeting, Dave Winney, a local resident, inquired whether council should hire on a consultant to “look at what has happened in other areas…” and to offer advice.

Addington Highlands Councillor Bill Cox said, “No, this council has not. It costs money and we don’t have it…We don’t have money to give consultants.”

Dan Carruthers, a cottage owner on Ashby Lake in Addington Highlands, then offered his assistance.

“I will personally pay for both a referendum, legal counsel, and any consultants. I will write you a cheque because I see this as an investment in protecting the property investments already made in this region for multiple generations.”

Carruthers went on to say “the only compelling reason I’m hearing for approval of these wind turbines is the ‘community vibrancy fund’ which is a bribe by any other name…it’s a small amount of money relative to what I think is gonna be the negative offset on this place being an attractive area for investment… 90 communities…across Ontario declared themselves ‘not a willing host.’ They’ve gone through this process.

North Frontenac Mayor Ron Higgins suggested that for them it was too early to bring a consultant into the discussion as they were still waiting on some crucial information.

Councillor Tony Fritsch brought Carruthers $50,000 offer to the Addington Highlands council meeting on May 19. The idea was rejected by a vote of 4-1.

Sarah Miller, an outspoken opponent of turbines, who said “the only control these councils have is right now. Right at the very beginning. If you declare yourself not a willing host you have the control. After that you have zero control. These companies move in and they will do whatever it takes. They are bulldozers. They are steamrollers.”

Another resident said “these cottage people pay the majority of the taxes. If these turbines come, there will be no cottage people.”

Helen Yanch, Councillor for Ward 2 in Addington Highlands spoke about some of the positives of the proposed project. “I know that there are some seniors that have signed up to have one, or two, of these [turbines] on their property and maybe they were thinking of it being an income for them”

A concerned lady in the audience said “I’m interested in property value because I too am a senior and I’m looking at probably in the next while, while all these shenanigans are taking place, having to sell and re-locate and I know, that because of what’s going on, my property value is going to go down…”

Paul Issacs made a request to council to “please, please don’t make your decision based on ‘it’s gonna happen anyway’…I think if you do that you’ve abandoned your responsibilities to represent us.”

“We’re listening.” Reeve Hogg said.

“Personally I don’t have a feeling for what the community thinks yet…” Councillor John Inglis from North Frontenac said.

There was little doubt about what the segment of the community that gathered in Denbigh last Saturday thinks about the project.

Two different speakers, Carmen Krogh and Parker Gallant, took to the microphone to help offer some insight and clarity to a discussion surrounding the possible negatives of having a large wind farm in the area.

Krogh, a retired pharmacist with over 40 years of experience in the health studies, detailed, via an elaborate presentation, some of the possible health effects that residents should be aware of when living close to wind turbines.

“We have got some pretty strong evidence that concludes that our noise levels and our distances [setbacks] currently in Ontario aren’t working very well” Krogh stated.

She explained that both children, and adults, are vulnerable to noise, especially children born pre-term or with a low-birth weight, and that not enough research has been conducted yet to determine what the long-term effects on people living by wind turbines are.

She then spoke about the controversial study published in April of this year by the Council of Canadian Academies stating that the only adverse health effect they could prove connected to wind turbines was ‘chronic annoyance’. Krogh presented articles and studies that defined symptoms such as heart effects, vertigo, headache, sleep disturbance, and other issues that she said are connected to annoyance.

Krogh’s presentation went into detail on the science connected with amplitude modulation, which is the “swishing noise that people hear”, and how it tends to be the main source of the annoyance, along with light flicker from the towers. She also referenced a few accounts of people leaving their homes because of vibrations caused by wind turbines.

Krogh suggested that taking children into consideration is important when trying to find a solution. She also advocated for the government to do vigilance and long-term surveillance monitoring like they do in the pharmaceutical industry and concluded that more research is needed on possible health effects before approving wind farms.

Parker Gallant, a retired banker who had a 33-year career with TD Bank, dissected how we pay for energy in Ontario and suggested that in the last 15 years we’ve seen hydro rates almost triple. He explained how Ontario is currently generating more electricity than it can consume and that the excess power is sold to New York and Quebec and that even when it’s not sold off HydroOne still has to pay the companies that are generating it for the electricity, regardless if the province is using it or not.

Gallant explained that in the first 4 months of this year “Ontario exported over 8 terrawatts of energy that we didn’t need” and how that much energy would be enough to provide “over 900,000 households in Ontario with power for a full year.” His presentation was aimed at the flaws in HydroOne and the Large Renewable Procurement (LRP) by the Independent Electricity System Operator (IESO) that NextEra’s proposal falls under.

The wind turbines that Nextera are proposing for this project can be as tall as 110 metres to the hub, with the blade extending even higher. For comparison, as someone at the Denbigh meeting pointed out, these would be significantly taller than Bon Echo Rock.

The deadline for Nextera to submit their proposal to the IESO for this LRP is September 1st 2015 but they are seeking support from the townships by July 20. The project, if successful, is expected to be up and running by 2019.

Nextera is hosting open houses this coming weekend in Addington Highlands and North Frontenac to explain more about their projec.t The projects are awarded based in part on which company brings in the lowest price to the IESO. There is a 100-point system as part of the bidding process that discounts the proposal price by having support from the local council and a local Aboriginal group.

The Addington Highlands meeting takes place on Friday June 5th at 5pm at Denbigh Hall and a North Frontenac public meeting will take place Saturday June 6th at 10am at Harlowe Hall, followed by a presentation from Nextera.

Clarify position on wind farms: WCO to OFA

Land owners need to be socially responsible when deciding to sign leases for wind turbines, Wind Concerns Ontario tells Ontario Federation of Agriculture president

The following is a letter sent by Wind Concerns Ontario president Jane Wilson to OFA president Don McCabe, in response to remarks made by Mr. McCabe at a wind farm information meeting in Finch, Ontario. Several of Mr. McCabe’s comments to the audience, such as that there is no surplus of power in Ontario, were not correct, WCO said in the letter.

As well, while Mr. McCabe’s advice to landowners to “get a lawyer” is sound, Wilson said, the attitude that landowners need to concentrate only on getting everything they want in a lease is isolationist and archaic, and is helping to divide Ontario’s rural and small-town communities.

“Not one word was said about responsibility to community, and neighbours. This [attitude] does not represent the view of the contemporary and socially responsible farm operators that we work with; they are professionals who believe they are part of their communities and who are aware of—or at least consider—the effects of their actions on others,” Wilson said.

The letter was sent to Mr. McCabe, and the Board of Directors for the Ontario Federation of Agriculture.

Print

Dear Mr. McCabe:

It was interesting to meet you last week in Finch, Ontario at the Lions’ Club event, where we both spoke, along with Mr. Levy of CanWEA.

I was relieved to hear your strong advice to those attending and contemplating signing a lease with a wind power developer, to “get a lawyer, get a lawyer, get a lawyer.” This is excellent advice: as you know, these contracts typically contain dozens of pages of various clauses outlining requirements and limitations…many people do not understand what they are being asked to sign.

I was disappointed, however, in other aspects of your presentation. First, there were a couple of statements made that are not correct and may even be misleading.

Power surplus in Ontario: in my presentation I had suggested that more wind power projects were not necessary, especially not for a form of power generation that is intermittent, produced out-of-phase with demand and is expensive, causing Ontario electricity rates to rise. You countered by saying that Ontario has no surplus of power. This is not correct: the Ontario Energy Minister himself admits that Ontario has surplus power and also says that the province will have a surplus for years to come. See his quotes and the forecast for power rates in a Globe and Mail article here.

“Net metering”: you told the audience that they should arrange in their lease to share in the wind power produced by any turbines on their land. This is not correct—it is unlikely one could get power from the wind turbine on a farm, and moreover, it would be in violation of the contract the wind power developer has with the Ontario government to obtain the Feed In Tariff to do that.

Turbine noise: you suggested to the audience that if the noise from turbines were to bother them, they could make sure that there is a clause in the lease so that the power developer would have to address that. This is extremely unlikely; at present, there are thousands of noise complaints in Ontario that go unresolved by either the developer or the Ministry of the Environment.

Community input to power projects: In response to several questions from the floor, you did advise people to go to the government website on the new Large Renewable Power Request for Proposal process, but you also suggested to at least one audience member that there is nothing communities can do, if a power proposal comes forward. That is not correct: people can work with their municipal governments, members of their community, and also choose not to sign the agreement required of adjacent property owners.

Contracts: I believe you also suggested to a farm owner who had signed a contract/option and was now having second thoughts that there was nothing he could do. This also is not correct, and would have been another opportunity for you to advise him to “get a lawyer, get a lawyer, get a lawyer.”

That brings me to the second area of disappointment in your presentation: the overarching theme of your remarks was that if people are going to sign a lease for a wind turbine project they should make certain that they get concessions from the power developer that benefit them. There was not a single mention in your remarks of the need for responsible consideration of other members of one’s community, including fellow farm operators, and neighbours.

This was a very narrow view that demonstrates no balance and instead indicates an archaic, “I can do whatever I want on my land” view. This does not represent the view of the contemporary and socially responsible farm operators that we work with; they are professionals who believe they are part of their communities and who are aware of—or at least consider—the effects of their actions on others.

Our concern with this isolationist view of farm ownership is that it will further divide Ontario’s rural and small-town communities.

OFA needs to clarify its position on this matter, and further, consider advising your membership that when it comes to deciding whether to participate in a wind power project, the responsible course of action is to balance their financial opportunities with the economic, health and social needs of others around them.

We would be pleased to meet with the OFA Board to discuss our concerns.

Thank you very much.

Jane Wilson

President

Wind Concerns Ontario

What the K2 documents mean

Wind power agreements are very detailed and complex: not everyone knew what they were getting into, says lawyer Eric Gillespie
Wind power agreements are very detailed and complex: landowners are signing away property rights in the agreements

Last week, news of a $1 billion “charge” on properties leased for the K2 wind power project was sent out throughout Ontario, by an individual who happened upon them at a registry office.

While incomplete, the documents do indicate a situation that should be of concern to anyone leasing land for wind turbines, or other wind “farm”-associated uses.

Parker Gallant, a former bank vice-president, sums up what we know about the K2 situation:

…the lenders want to ensure protection of their loan. The security they look for is 1. the actual wind turbines  (the capital cost to build them and their value), 2. the OPA contract (probably via an acknowledged assignment), and 3. the leases (due to concern the lessor may back out or sue the developer) that property owners have signed.

The lenders would be looking at the consequences of, say, the property owner selling his property or someone else like a bank (who is providing a mortgage or a short-term loan to finance crops or cattle before taking the cattle to market or selling the crops), or the township (for non-payment of property taxes) stepping in and exercising their rights under their security or position (e.g., municipal taxes owing but unpaid).

By registering against the property, the lender knows they would get first rights to pay up (property taxes) or stop the sale (if the lessee decided to sell) in order to cure the default etc.  What that effectively does is tie the hands of the lessor until the contract expires or the lender is repaid in full.  Any one who signed the lease is putting themselves in that position and it is surprising that more people don’t understand what they are doing when they agree to lease their property to a developer.

We will be looking into the K2 documents in greater detail as is possible, but once again, the lesson for landowners is, it’s not simply a deal where you lease a bit of your property and get some money every year. These wind turbine leases are very serious documents, full of implications for the landowner.

As one Ontario mayor told the Not A Willing Host meeting at the Association of Municipalities of Ontario meeting in Ottawa almost two years ago, “What landowners need to understand is that they essentially sold their property for the lease amount.”

K2 is just another example of that object lesson.

 

Wind farm liens evidence of serious liability for property owners

Wind power agreements are very detailed and complex: not everyone knew what they were getting into, says lawyer Eric Gillespie
Wind power agreements are very detailed and complex: not everyone knew what they were getting into, says lawyer Eric Gillespie

A story out of Illinois recently revealed that when furniture giant IKEA (which is engaged in a PR campaign to offset its “carbon footprint” by investing in wind power) and an associated wind power developer failed to pay one of their suppliers, liens were placed on title of the land owned by the farm owners/property owners who had leased their land for the wind power project.

When Wind Concerns Ontario published this story, we received news that this is happening in Ontario, too. In fact, documents were filed in court last year to place liens on property owned by 24 people on Manitoulin Island; the property owners had leased land or received payments for transmission lines on their properties. The sub-contractor, R.M. Belanger, had not been paid $2.03 million owing to the company by another sub-contractor, which was hired by the wind developer for the McLean’s Mountain project, Northland Power.

Northland Power has been approved by the Independent Electricity Systems Operator/IESO as a Qualified Applicant for new renewable power contracts to be let during 2015.

The liability for the $2+ million debt for the Manitoulin Island project is now shared by the 24 property owners, which works out to more than $83,000 liability per owner.

Toronto-based environmental lawyer Eric Gillespie, who has represented community groups fighting wind power projects and private land owners seeking to get out of wind power options and contracts, commented to WCO on the Manitoulin Island situation: “One of the major problems for landowners is the detail and complexity of agreements. Often, people don’t know what they are really getting into. What seems to be happening in Manitoulin right now highlights the fact that what seemed like a ‘good deal’ at the time, can potentially end up being a very bad deal.”

“This is yet another example of how wind power as it is being implemented in Ontario is having a negative impact on farming communities,” said Jane Wilson, president, Wind Concerns Ontario. “All the benefits go to a few corporate wind developers, while the property owners, their neighbours, and Ontario’s rural and small-town communities have to live with side effects.”

Ontario is launching a new Request for Proposal process for renewable power projects on March 2. Emphasis will be on new development in Eastern and Northern Ontario.

“We hope that property owners make sure they know the full range of potential results from signing any type of agreement, including liability for legal actions from developer sub-contractors, and for property value loss and health problems experienced by others in their communities,” Wilson said.

Thanks to Wind Concerns Ontario community group member Manitoulin Coalition for Safe Energy Alternatives (MCSEA) for linking us to the court documents, which may be found here: ManitoulinLienCourtDocs

windconcerns@gmail.com