County approves wind farm definitive agreements 

The site plan and term sheet for the Soldier Creek Wind Farm (SCWF) were approved in July 2019. Since that time, the Nemaha County (NC) Commissioners have been in negotiations to fine tune the details that were already laid out in the term sheet. After many phone calls and months of negotiations with NextEra Energy Resources (NE) – the project’s developer – the County now has agreed to the final terms for the development of the SCWF.

Commissioners Gary Scoby, Dennis Henry and Tim Burdiek signed the binding documents during a special meeting on Wednesday, Feb. 26. The five agreements that were signed were the Development Agreement, Contribution Agreement, Road Use and Maintenance Agreement, Decommissioning Agreement and Complaint Resolution Agreement.

Below is an overview of each agreement with key points being noted.

Development Agreement

This agreement allows NE to develop a 300 megawatt wind project – SCWF – in NC. The project is to be located on privately owned rural farmland or public right of ways within NC. The project is to consist of wind turbine generators, meteorological towers, substations, collection lines, access roads, temporary construction areas, operation and maintenance facilities and other infrastructures relating to the SCWF.

Key points in this agreement are as follows:

*Numbers below correspond to numbered paragraphs in actual agreement

Section III: Development Requirements

A. Definitive Agreements

NE and NC agree to enter into the following agreements: Road Use Agreement, Decommissioning Agreement, Contribution Agreement and Complaint Resolution Agreement.

B. Landowner Participation

All wind turbines and related structures within NC will be located on public rights of way and property that is owned by NE, or property on which NE has or will have executed a lease, easement or other agreement with the applicable landowner.

C. Site Plan, Setbacks and Exclusion Zones

1C. Site Plan – NE will site and NC approves, wind turbines within 100 feet of the locations and GPS coordinates depicted on the site plan. If NE chooses to move the location of a wind turbine greater than 100 feet from the location depicted on the site plan, the re-location must be submitted to Nemaha County for review and approval. No wind turbine can be moved closer than the locations depicted on the site plan from an occupied residential non-participating dwelling currently in existence, or closer than 600 feet from a non-participating property line currently in existence in NC, unless otherwise agreed to by the non-participating landowner. The SCWF will not exceed 300 megawatts. See site plan at http://ks-nemaha.manatron.com/.

2C. Public Roads – All wind turbines will be set back at least 1.1 times the height of the wind turbine (including tower, turbine and blades) from public roads, as measured from the base of the tower to any point on any county, township, state or federal road currently in existence. This excludes private roads.

3C. Incorporated Municipal Boundaries – All wind turbines will be set back at least one mile from incorporated municipal boundaries currently in existence in NC, as measured from the base of the tower to the nearest point on such boundary line.

4C. Unincorporated Municipality of Kelly, Kansas – All wind turbines will be set back at least one mile from the city center of Kelly.

5C. Exclusion Zones – No wind turbine may be constructed within exclusion zones located in NC. Exclusion zones are any area outside of the project boundary lines.

6C. Above Ground Collection Lines and Developer-Owned Transmission Line Tower Setbacks – Above ground collection lines and transmission lines owned by NE will be set back at least 1.5 times the height of the transmission line tower, as measured from the base of the tower to the nearest outside wall, from any non-participating occupied residential dwelling currently in existence in NC. The maximum height of the NE-owned transmission line towers will be 130 feet. Collection lines are to be located within leases or easements on participating landowner property, or located underground on public right of way crossings as approved by NC. The setbacks and height requirements can be modified with written consent of Nemaha County.

7C. Footings – A structural professional engineer licensed in the State of Kansas, who is agreed upon by both NC and NE, will certify that the proper footing designs meet applicable industry safety standards.

8C. Sound Levels and Ice Throw – Sound levels are not allowed to exceed 50 dBa Leq – a continuous sound level in decibels – measured at the nearest outside wall of schools, hospitals, churches, public libraries or non-participating occupied residential dwelling, unless agreed to by the landowner. Sound levels can not exceed 55 dBa Leq at the nearest external wall of a participating occupied residential dwelling. NE will implement multiple turbine control measures to mitigate ice shed. If a citizen of NC – whose residence is within one mile of the nearest SCWF turbine – has a complaint related to shadow flicker or sound filed under the complaint resolution to NE, NE will produce a shadow flicker report and/or sound report to that resident.

9C. Shadow Flicker, Advertising, FAA and Color – Shadow flicker will not exceed a cumulative 30 hours per year, at non-participating occupied dwellings currently in existence in NC. No logo or advertisement will be located on turbines unless approved by NC. Turbine coloring will adhere to aviation safety regulations, and will have a non-reflective matte finish.

11C. Emergency Services, Fire Protection, and Hazardous Materials – NE will work with NC Emergency Management Director to establish standards for fire protection and emergency response. NE will make a voluntary contribution of $80,000 to NC, specifically designated for the fire departments impacted by the SCWF. NE will work with the NC Emergency Management Director to establish standards for proper storage and handling of hazardous materials. NE will work with NC to establish 911 addresses for each wind turbine.

12C. Disclosure of Environmental Studies – NE will provide to NC copies of any non-confidential and publicly available environmental studies conducted on SCWF project area. Those studies would include anything that addresses noise, illumination, wildlife and aviation safety.

13C. Reimbursements to the County – NE will reimburse NC for fees related to professional services, such as engineering, accounting and legal.

14C. Manufacturer and Interconnection Specifications – All wind turbines and related structures within NC will be installed in material compliance with manufacturer recommended specifications. The maximum height of all wind turbines in the SCWF will be 500 feet. NE can replace wind turbines as required, but any replacement wind turbine will comply with the 500 feet height limitation.

15C. Compliance with Laws – NE will comply with all federal and state laws and regulations applicable to the construction and operation of SCWF.

16C. Compliance with Warranties – All wind turbines will be installed and operated to maintain applicable turbine manufacturer warranties.

See full Development Agreement at http://ks-nemaha.manatron.com/. This agreement includes the SCWF Site Plan along with exact turbine locations and their coordinates.

Contribution Agreement

This agreement explains the terms and conditions regarding the annual contributions that NE will make to NC during the life of the project, which is 30 years.

Key points in this agreement are as follows:

*Numbers below correspond to numbered paragraphs in actual agreement

Terms and Conditions

2. Upon execution of the agreement, NE will make a one-time payment of $1,250,000 to NC.

3. Once the SCWF is in Commercial Operation, NE will make annual contributions to NC by Dec. 31 each year. This payment will commence once the SCWF is deemed completed by NE and is in commercial operation. There will be a total of 30 contributions. The first 10 payments will be in the amount of $900,000. The next 10 payments will be in the amount of $1,250,000, and the last 10 payments will be in the amount of $1,110,000. The total amount being given to NC by NextEra will be $33,850,000.

4. NC can direct the initial payment and each contribution to any taxing jurisdiction, general County fund or specific fund. NC will determine how the initial payment and contributions will be distributed, with the intent for the money to be used in the best interests of Nemaha County residents.

6. On the same day that NE makes the initial payment to NC, they also will make a voluntary contribution of $80,000 to NC, specifically designated for the fire departments impacted by the SCWF.

7. NC and NE agree that the lifetime property tax exemption is subject to the review and approval of the Kansas Board of Tax Appeals. In the event that the Kansas Board of Tax Appeals does not provide a certification of the lifetime tax exemption for the SCWF, this agreement will terminate without liability of either NC or NE, except for NE’s obligation to make the initial payment. The wind farm would then be taxed according to the standard statutory tax regime.

8. In the event that NC would enact any new or amended county laws in the future that prohibit, limit or provide standards for, or burden the development, construction, or operation of the SCWF, any laws shall exempt the SCWF from compliance.

9. If NE fails to make any payment (initial payment or contribution payments), NC may provide written notice to NE. NE will then have 60 days from the date of the written notice to make the required payment. If NE fails to provide the payment, then both parties agree to meet within 60 days of notice and will employ good faith efforts to try and resolve the issue. If the parties are unable to resolve the issue within a 60 day time period, then NE will pay the disputed payment and may do so “under protest.” If NE fails to make the payment – either under protest or not – within the time period, then NE will cease operations for the entire SCWF project until the disputed amount is paid. NC may seek an immediate injunction to cause the SCWF to cease operations, and NE consents to the jurisdiction of NC for this action.

See full Contribution Agreement at http://ks-nemaha.manatron.com/. This agreement includes the Contribution Payments chart.

Road Use and Maintenance Agreement

This agreement allows NE and its affiliates to develop, operate and maintain the SCWF. This will include needing to use Nemaha County roads, and address issues pertaining to the roads and right of ways that will arise in and near the SCWF.

Key points in this agreement are as follows:

Terms and Conditions

*numbers below correspond to numbered paragraphs in actual agreement

Section 2: Grants

A. Roads: NC grants NE and its representatives a non-exclusive roads right of way to enter and utilize any road within NC, including the roads with vehicles or combined vehicles less that 10,000 pounds, or to have any road within NC, including the roads utilized by third-party courier or delivery services, with vehicles or combined vehicles less that 10,000 pounds.

NC also grants NE and its affiliates a non-exclusive road right of way to enter and utilize the portion of the roads – identified on the road and haul route map as “construction road use” – with vehicles or combined vehicles equal to or greater than 10,000 pounds, but less than 40,000 pounds.

NC also grants NE and its affiliates a non-exclusive road right of way to enter and utilize the portion of the roads – identified on the road and haul route map as “oversize road use” – with vehicles or combined vehicles equal to or greater than 40,000 pounds.

NE’s use of the roads for regulated road use will occur between 6 a.m. and 10 p.m., seven days a week. NC also agreed to use reasonable efforts to accommodate requests for regulated road use – which includes oversize road use and construction road use combined – and outside the allowed time frame identified during the construction of the SCWF, including but not limited to the pouring of concrete and operation of cranes. NE will be required to submit all requests for accommodations to Tim Burdiek at least 48 hours in advance. NE reserves the right to amend road and haul route maps at NE’s discretion, but only with the approval of the Tim Burdiek.

B. Right of Ways: NC grants NE and its affiliates a non-exclusive license to use the right of ways for the limited purposes of installing electrical and communication cables below the ground, and constructing, modifying, removing or repairing Road improvements, access points or turn radii, or performing any other activities required of NE.

C. Non-Exclusive Grants: The above grants from NC to NE are not exclusive, and NC reserves the right for itself and the public (as applicable) to continue to use the roads and the right of ways in a manner that does not impede the rights granted to NE.

Section 3: Consideration for Grants

A. Obligation to Repair Non-Project Roads and Roads: In the event that any of the roads or related appurtenances – including bridges, culverts and other road fixtures – modifications and improvements (listed below), or non-project roads are damaged as a result of the use by NE, NE agrees to repair such damage and to restore such non-project road, road or related appurtenance to the condition they were in prior to the use. Both NC and NE will rely upon the pre-construction inventory to determine this. Any repair and restoration will be promptly performed at a time that Tim Burdiek and NE determine, or within six months. Following completion of such repair, Tim Burdiek and NE will jointly inspect the repair to determine that it has been satisfactorily completed.

Required Road Improvements include the following:

• All culverts that are on, under or adjacent to the roads will be replaced on a case by case basis, based upon pre-construction inventory compared to the post-construction inventory;

• NE will replace culverts I20 and I22 with eight foot culverts with double tubes. They also will reinforce culvert P44 for construction traffic and replace culvert P44 after the completion of the construction.

B. Repairs of Roads and Non-Project Roads at the Request of County Designee: Tim Burdiek may request in writing that NE repair damage shown to be caused by NE or its representatives to the roads and non-project roads and related appurtenances, and return such roads and appurtenances to the condition the roads and appurtenances were in prior to such damage. Prior to commencement of such repair, Tim Burdiek and NE will meet to review the damage in relation to the pre-­construction inventory. Any repairs by NE will be promptly performed within 90 days, weather permitting. Following completion of such repair, Tim Burdiek and NE shall jointly inspect the repair to determine that it has been satisfactorily completed.

C. Failure to Repair Roads: If NE fails to repair roads, non-project roads and related appurtenances, NC may make the repairs and will invoice NE for the costs incurred by NC in connection with the repair. NE will pay the invoiced amount within 90 days.

D. Improvements and Modifications to Roads: Both NC and NE agree that modifications to roads are necessary to accommodate the use of roads, including widening certain roads, strengthening bridges, replacement of culverts, etc. Prior to the commencement of construction, and in the presence of NC’s engineering representatives, NE will “proof roll” all roads with a loaded tandem axel dump truck. Any roads that show signs of rutting or pumping will have road rock applied to them by NE in amounts as required, in order to alleviate the rutting or pumping. All of this work will be done at the expense of NE.

E. Collection System Cabling: NC and NE agree that NE will route certain wires, cables, conduits and/or lines (and their associated equipment) related to the transmission of electricity, at a voltage of up to 34.5 kilovolts (kV), from the SCWF – below ground – at a location adjacent to, under or across the roads or the right of ways.

Cable installations will not negatively impact existing improvements within the right of ways or anticipated future development of the right of ways, which have been previously approved by NC. Cable installations running parallel to existing stream crossings, where there is an existing county bridge, shall not be buried in right of ways parallel to said bridge, and must be buried no less than 25 feet onto private property within an easement acquired by NE.

Cable installations will be buried at a minimum depth of 48 inches below the lowest level of the adjoining drainage ditch, unless otherwise approved by Tim Burdiek, and will be encased in high density polyethylene pipe, and, if crossing a road or other improvement, the road or other improvement will be restored promptly to its pre-construction condition.

NE additionally agrees that no overhead transmission line poles will be located within the right of ways.

F. Removal of Road and Right of Way Improvements: NE will remove all improvements from the roads and right of ways within 12 months of the termination or expiration of this agreement at no cost to NC. NC may request certain improvements remain in place and upon such request, NE will leave in place such improvements, and NE’s obligations related to those requested improvements will cease and be of no further force and effect regarding removal, maintaining or damages related.

G. Use of Roads Generally: NE will, in a reasonable effort, try to minimize adverse impact on the local traffic. If roads will be impacted, NE must provide an 48-hour advance notice to NC when it is necessary for a road to be closed for a period exceeding one hour for any reason relating to the construction of the SCWF. NE also will provide all materials and pay for the costs necessary to close the road.

K. Contribution for Certain Improvements: Within 14 days of Feb. 26, 2020, NE will pay $165,000 to NC to rebuild/replace bridges N8, R41 and R9.

L. Maintenance Payment Obligation: On the first business day of July each calendar year – beginning July 1, 2020 – NE will make a payment of $85,000 to NC to help offset the maintenance obligations of NC. NC will distribute this payment proportionally to the townships based on the number of turbines in each township.

Section 4: County Requirements

A. Perform reasonable routine and regular maintenance of the roads, including grading, snow removal and regularly scheduled maintenance and repair.

B and C. Within five working days from the date they are submitted, review and approve or disapprove plans and issue permits for all SCWF-related access points and road crossings, as well as right of ways.

D. If applicable, within five working days from the date requests are submitted, issue master overweight and oversize permits for the roads, and waive overweight and oversize permits.

See full Road Use and Maintenance Agreement at http://ks-nemaha.manatron.com/. This agreement includes the Roads and Haul Route map, and the location of cable installation map.

Decommissioning Agreement

This agreement states that NE will provide financial security to address the cost of decommissioning the SCWF in the form of a bond, letter of credit, guarantee or other security. For this agreement, generation units are defined as turbine tower, nacelle, blades and generator. Supporting facilities will be defined as any related foundations, transformers, meteorological towers, underground cables, roads and collector substations.

Key points in this agreement are as follows:

*Numbers below correspond to numbered paragraphs in actual agreement

Article 1: Decommissioning and Restoration Security

Section 1.1: Agreement to Decommission

A. NE will decommission each generating unit and applicable supporting facility as described. NE will return any land disturbed or changed as a result of the SCWF to its pre-construction condition or the then existing condition of the contiguous lands or roads. Decommissioning services include soil replacement, revegetation and seeding, noxious weeds removal, dust control, removal of applicable generating units and supporting facilities.

B. In the event that a generating unit has failed to produce electricity or has been out of service for 12 consecutive months, NE will promptly provide notice to NC. NC can request NE to provide a response to an inquiry pertaining to any particular generating unit if NC believes the unit has not been producing electricity for 12 consecutive months.

C. NE will decommission generating units and applicable supporting facilities within 12 months from the date triggering the decommissioning obligation.

D. Once decommissioning commences, NE will in a competent manner in accordance with industry standards diligently, continuously and in good faith continue the decommissioning.

E. NE will furnish all supervision, labor, equipment, tools, materials, machinery, vehicles, transportation, subcontracted items, supplies and personnel necessary to perform the decommissioning of the generating units and supporting facilities.

G. NE will maintain all required insurance under the development agreement for the term of this agreement and will, prior to decommissioning, provide required certification of insurance to NC.

H. NE warrants that all work to be provided under this agreement will be performed by qualified persons or contractors.

Section 1.2: Third Party Engineer

NE will reimburse NC for the reasonable cost of employing a third-party engineer licensed in the State of Kansas with knowledge of the operation and decommissioning of wind farms, who is acceptable to NC. This engineer will be responsible for assisting NC with determining the amount of the restoration security, evaluation and monitoring the decommissioning process and certifying that the decommissioning process has been completed consistent with the terms of this agreement. The third party engineering firms that NC can choose from are Black and Veatch, and Burns and McDonnell.

Section 1.3: Initial Cost Estimate

NE and NC agree that the net removal cost for purposes of decommissioning the restoration security for the first five years of the term will be $7,955,040. The amount relied on by NE for the cost estimate was determined by the third party engineer, and is equal to no less that 100 percent of the estimated amount of the cost of removing the supporting facilities and generating units. This included the estimated salvage value of the supporting facilities and generating units. The third party engineer will re-evaluate – at the cost of NE – the amount of the net removal cost upon each subsequent five year anniversary of the completion of construction of the SCWF until the project is considered decommissioned.

Section 1.4: Financial Assistance

A. Restoration Security – Before construction begins, NE will deliver to NC a performance bond, letter of credit or guarantee issued by a creditworthy business or financial institution acceptable to NC, which will be securing the performance of the decommissioning obligations. NE will pay all fees and premiums associated with establishing and maintaining the restoration security.

B. Restoration Security Provider; Restoration Security Beneficiaries – NE will submit as least 30 days prior to the delivery of the restoration security to NC, the name of the security provider and the documents governing the issuance of the restoration security for NC’s review and approval.

C. Restoration Security Renewal – Upon each re-evaluation of the net removal cost and subsequent adjustment to the restoration security, NE will deliver to NC a certificate or continuation documenting the updated estimate of the net removal costs prepared by the third party engineer and demonstrating that the restoration security is equal to or greater than the updated net removal cost, and that the restoration security will stay in force for at least the next five years.

D. Failure to Provide Certificate of Continuation – If NE fails to provide the certificate of continuation, NC can provide written notice to NE, and NE will be afforded 90 days to cure prior to Nemaha County declaring a default under this Agreement, the Road Use Agreement and the Development Agreement. If NE does not provide the certificate of continuation within the 90 days, NC can take action.

Article II: Disbursement of Restoration Security

Section 2.1: Rights of County

In the event that NE fails to decommission the SCWF in accordance to this agreement, NC may undertake the decommission of the SCWF and may make a claim on the restoration security to pay a third party to complete the decommissioning obligations of NE. If NE fails to decommission the SCWF in accordance with these terms, NC has the right to seek injunctive relief available under applicable law to effect or complete the decommissioning of the SCWF; seek reimbursement from NE for any documented and reasonable costs of decommissioning the SCWF incurred by NC, in excess of the funds available under the restoration security; and seek all remedies at law.

Section 2.2: Release of Restoration Security

The security provider will release the restoration security when NE has completed the decommissioning obligations to the satisfaction of NC.

See full decommissioning agreement at http://ks-nemaha.manatron.com/. This agreement includes the Cook, Flatt and Strobel Engineers (NC’s hired engineering firm) Decommissioning Cost Analysis.

Complaint Resolution Agreement

This agreement allows grieved parties – landowners, non-participating landowners, residents and businesses – to make a complaint or concern regarding the health, safety, welfare or general development, management and decommissioning of the SCWF.

Key points in this agreement are as follows:

*Numbers below correspond to numbered paragraphs in actual agreement

Agreement

1. Complaint Resolution

Effective Feb. 26, 2020, NE will do the following to address the concerns of grieved parties:

A. Establish a 24 hour/seven days a week single point of contact for fielding and addressing SCWF claims or issues including road issues.

B. Provide notice of this single point of contact on the complaint form and post the complaint form in public locations, including the SCWF operation and maintenance building, and on the SCWF website. The website is https://www.nexteraenergyresources.com/soldier-creek-wind.html.

C. Ensure the single point of contact take any and all necessary measures to keep incoming complaints in a form similar to the complaint form.

D. Make reasonable effort to ensure a SCWF representative responds to inquiries from the grieved parties within five business days (during normal business hours) after an inquiry has been made.

E. Maintain a record, including any complaints received, the resolution of such complaints and any unresolved complaints. The record will include steps to resolve complaints.

F. Correct, as soon as practical, any confirmed complaints. In a case where a resolution cannot be delivered within 30 days, a timeline and measure to be taken will be provided to the complainant, and a copy of the complaint sent to NC.

G. Deliver to NC a report of all complaints on either an annual basis or within 30 days of a written request by NC.

2. County Action

NE agrees that at the request and cost of NC, NC may order a review of the unresolved complaints by a professional engineer licensed in the State of Kansas, who has experience with wind turbines and wind projects, acceptable to the County (reviewing engineer) to review the unresolved complaint and submit its report within 30 days. NE will reasonably cooperate with a requested review of an unresolved complaint. If there is no dispute with the reviewing engineer’s recommendation, requirement, action or decision, NE will act in accordance with the direction of the reviewing engineer and NC.

3. Engineering Disputes

In the event that NE disputes any recommendation, requirement, action, or decision of the reviewing engineer, NE will notify NC and the reviewing engineer within 30 days of receipt of the recommendation of the reviewing engineer, and NE will retain – at its own expense – a third-party engineer licensed in the State of Kansas with knowledge of the operation and decommissioning of wind farms (appealing engineer) to review the recommendation, requirement, action or decision.

The reviewing engineer and the appealing engineer will meet within 30 days of such notice, and will employ good faith efforts to try to resolve the dispute. If the reviewing engineer and the appealing engineer are unable to resolve such dispute within 60 days of such notice, the reviewing engineer and the appealing engineer will agree upon a third engineer licensed in the State of Kansas with knowledge of the operation and decommissioning of wind farms (the “deciding engineer”), which will be paid for by NE, who will then have a maximum of 60 days to review the recommendation, requirement, action or decision, and render the final decision, which will be binding between NE and NC.

In the event the deciding engineer agrees with the reviewing engineer, then NE will reimburse NC for its reasonable expenses related to the engagement of the reviewing engineer. NE will then be given a minimum of 60 days to act upon such final decision, but no later than a date determined by the deciding engineer to act on the final decision.

For the avoidance of doubt, neither the SCWF, or any individual wind turbine will be required to cease operation due to any disputed condition until the entire process is completed.

4. Developer Default

If NE fails to act on the complaint agreement for 60 days after receiving written notice of such failure from NC, then it will constitute a default by NE of the definitive agreements and NC shall have the right to pursue any remedy available under the definitive agreements, as long as NE is diligently attempting to cure such failure, and the failure is reasonably capable of being cured.

5. Term

Unless this agreement is extended by mutual agreement of NE and NC, terminated early or the SCWF ceases to be in commercial operation, the terms in the complaint agreement shall extend for a period of 30 years from Feb. 26, 2020, at which point NE and NC will enter into good faith negotiations to extend the terms of this agreement, if and as necessary.

See full Complaint Resolution Agreement at http://ks-nemaha.manatron.com/. This agreement includes a copy of the Complaint Form.