Vermont regulators approve 16-turbine, 40-MW wind project in Sheffield 

The Vermont Public Service Board on Aug. 8 approved UPC Vermont Wind’s planned 16-turbine, 40-MW wind generation facility in Sheffield, Vt., setting conditions on power contracts, noise traffic and decommissioning.

The board also said in a statement Aug. 8 that in approving the project, it reiterated its finding that wind generation facilities like the Sheffield project can provide benefits to the state and region, including fuel diversity, energy independence, reduced air emissions and increased tax revenue.

Specific economic benefits offered by the project, such as increased tax revenues to the state and the host town, were noted. The board acknowledged the increasing interest in renewable energy at both the state and regional levels.

Visual impacts were a central concern for members of the public and others, the board said, concluding that the visual impacts would not be “unduly adverse” under a certain test it adopted, and ruled that the project’s benefits outweigh the visual impacts.

The order’s conditions include setting maximum noise levels to protect nearby locations, approving a wildlife protection agreement reached between the Vermont Agency of Natural Resources and UPC and adopting requirements to protect towns that will be affected by construction traffic, the board added.

The order requires a fully funded decommissioning account to ensure the facility can be removed and the site restored when it no longer provides substantial public benefit.

UPC is to negotiate and submit to the board its power sales agreements with state utilities to provide greater price stability than the company’s proposal, which provided for the sale of all the project’s output to state utilities, but indexed most of the price to the New England wholesale electricity market.

The condition, the board added, reflects state law that encourages the development of renewable energy in part because renewable generation does not depend on fossil fuels, for which prices are volatile and expected to rise.

The contracts that UPC negotiated did not capture this benefit, the board said, as they would have sold most of the power to state utilities at a fixed percentage below the New England wholesale electricity market price, which is largely tied to the more volatile price of natural gas.

According to the order, Washington Electric Cooperative Inc. has entered into agreements with UPC to buy 2 MW for a fixed price and an additional 4 MW at a weighted average of the market price. Also, UPC and Vermont Electric Cooperative Inc. have entered into a power purchase agreement under which the cooperative would buy 50% of the project’s output at 95% of the market price for the first 10 years and 90% of the market price for the following 10 years, the order stated.

In addition, UPC and Central Vermont Public Service Corp. have discussed an arrangement similar to the power contract between Vermont Electric Co-op and UPC, the order added.

In an Aug. 8 statement, UPC Wind President and CEO Paul Gaynor said that the company is pleased that the board recognized the proposed project’s value, noting that the company made multiple adjustments in response to comments from the public.

UPC Vermont Wind is a subsidiary of UPC Wind Partners.

For example, the project’s location was adjusted three times and different wind turbines were chosen to optimize the output from fewer turbines, the company said.

The company also said that it will watch closely the state Legislature’s deliberations over tax incentives for renewable energy projects.

“While the certificate of public good is a significant milestone, clarifying state legislation regarding the tax rate on renewable energy projects remains a key component to this project becoming a viable part of Vermont’s energy portfolio,” UPC Wind’s project manager, Matt Kearns, said in the statement. “Passage of legislation supporting wind farm development will put Vermont on track as a leader in renewable energy.”

When in operation, the wind facility will produce roughly 115,000 MWh annually, UPC Wind said.

By Corina Rivera

snl.com

9 August 2007