Better Plan, Wisconsin

"This is merely an evolution of principles that have been evolving since the sovereign rights of eminent domain were determined to exist," according to Hugh Nierengarten, New Ulm City Attorney.

"Eminent domain is basically like a nuclear bomb," said Clete Goblirsch, a farmer who refuses to sign an easement. "The repercussions would be long lasting and widespread, not just for us, but for the wind industry."

While public utilities have fairly broad powers to use government authority to force property owners to sell to meet their needs, the New Ulm plan involves an unprecedented move to expand eminent domain authority to include the seizure of air space on private property for power generation.

"This is a first time this question has come up and the first time any entity has indicated they might use condemnation for wind development," said Bob Cupit, an expert with the Minnesota Public Utilities Commission (PUC).

The opponents' objections to the proposed five wind turbines include noise concerns, lower property values, and adverse impact on the landscape and rural atmosphere. "Nobody's against wind energy," said Jeff Franta, a farmer who's helped organize the opposition. "We're just against a project being forced on an area that doesn't want it."

Legal experts say the city would need to make the case in court that the utility would be taking wind rights for a public purpose and necessity. In a July 30, 2009 filing with the PUC, Nierengarten, on behalf of the New Ulm Public Utilities Commission, insisted "the development of clean, renewable energy should be the motivating, prudent public policy consideration, not provincial notions of "local control" and the "rural way of life.""

Acknowledging there would be "a likely furor over such an effort," Nierengarten added "it will be necessary for the City of New Ulm to exercise its powers of eminent domain to secure such rights and move this vital project forward."

New Ulm has acquired easements for 237 acres on which the wind farm would be built. A little known state requirement, however, also compels wind farm operators to obtain the so-called wind rights to about 235 acres of adjacent property in the path of the prevailing winds to assure a free flow of wind to the turbines. The city has run into turbulence with the wind farm's neighbors, who refuse to grant the necessary easements, stalling the $16-18 million project.

"Wind rights are property rights like oil, water or a gravel pit," said Franta, "Wind is like the oil in the sky so to speak. How can you use eminent domain to get something that can produce a profit for people?"

Further complicating matters, the proposed site is located about 10 miles outside of New Ulm and in a different county, leaving opponents no option for holding local officials accountable at election time. "We don't vote for city officials in New Ulm," Franta said. "It wouldn't do any good because we don't vote for them."

In its pending permit application before the PUC, the City of New Ulm has applied for a variance or exemption from the requirement to obtain the additional wind rights. That's an unlikely outcome, according to PUC staff, who expect to recommend that commissioners approve New Ulm's draft permit without a variance, setting the stage for a potential showdown.

"We (PUC) don't have powers to settle eminent domain questions," Cupit said. "We do have concerns about our permits being leveraged in this instance to force a project on a community that doesn't want it."

"If they deny the waiver and require us to acquire the wind rights, then the city and the public utility commission have to decide if they're going to do this," Nierengarten said. "Clearly the preference is to get on with the project."

"Are they going to eminent domain our land to get to the wind rights?" asks Clete Goblirsch. "If they can't eminent domain the wind rights, what's to stop them from saying, ‘fine, we'll get the land and the wind rights with the land?'"

The potentially volatile case comes at a critical time with Minnesota and the nation fast tracking green energy projects that are often fueled by federal grants, including billions in stimulus spending. Minnesota ranks fourth in overall wind production nationally with 1805 megawatts of wind-generated electrical capacity. Currently, approximately 21 wind energy projects and proposals are on the table statewide, according to the PUC.

"Until recently, utilities weren't developing wind power. It's been large private companies in most cases without eminent domain authority," Cupit said. "We're not aware of any utility in Minnesota that has used eminent domain for any wind project."

"Don't come do this to me. This is America," said Goblirsch. "Don't come and infringe on me."

The Minnesota Public Utilities Commission expects to render a decision on the matter by early January at the latest.

Did the federal government, as some have said, give millions of dollars in stimulus funds to a non-producing wind farm in the Southern Tier town of Cohocton? Not exactly.

Cohocton Wind is a 50-turbine project with a total 125-megawatt generation capacity - the potential to power 50,000 homes, say officials with First Wind, Cohocton Wind's parent company. In September, the project was awarded $74.6 million in federal stimulus funds from the US Departments of Energy and Treasury - part of a large block of funding meant to encourage renewable energy development nationwide.

That grant's come under protest, however, by Congress member Eric Massa, who wrote the president to ask that the funding be revoked.

"We should not be rewarding anything, let alone cash grants, to companies like this that have abused the public trust and created such a toxic atmosphere in our region on the topic of wind power," Massa wrote.

The project's been plagued by controversy, including lawsuits and an attorney general's office investigation into First Wind and other wind power development companies. Since the project came online in January, it's been dogged by questions about what it's actually producing electricity-wise - lately that's been one of the most persistent issues. Massa made the claim in his letter, which he sent in September, that the project wasn't producing any power, information he said he received from the organization that operates New York's power grid.

"Nobody knows what they produce or what they don't produce," Massa said in an interview last week. "They demand the privacy of a private corporation and the subsidies of a public utility."

But John Lamontagne, a First Wind spokesperson, says the turbines produced 133,370 megawatt hours of electricity from when they came online in January, to the end of September. That's enough energy to power 1,200 homes with average monthly electricity consumption.

The wind farm hasn't produced the amount of energy the company would like, but it's had some maintenance issues involving gears and blades, Lamontagne says. The same issues plagued the company's Steel Winds development in Lackawanna, near Buffalo.

"The project hasn't been at 100 percent," he says.

The New York Independent Systems Operator, the body that operates the state's power grid, issues a yearly report detailing the amount of electricity produced by the state's individual power plants. Cohocton Wind's status as a producer was not included in this year's report, because the farm only came online in January. It should be included in next year's report, however. Calls to the ISO were not returned by this paper's deadline.

Massa's comments illustrate just one aspect of the ongoing feud between wind farm critics and developers. Critics say that wind companies oversell the turbines' performance and play down potential drawbacks such as noise, visual impact, and an intermittent electric supply. Wind developers say the turbines are vital clean energy generators that will help the US reduce dependence on fossil fuels, and that they serve as an economic benefit to the communities they're in.

The federal stimulus money serves as an incentive to develop wind farms, which is exactly what the government intended. But these recent grants -about $475 million went out to renewable energy projects across the country - replaced tax credits. It's a swap of sorts - the companies get upfront funding and agree to forgo the tax credits in future years. The idea was to create upfront funding for companies that, thanks to the economy, were having trouble getting financing, say statements from the US Departments of Energy and Treasury.

The stimulus money came with no restrictions on how it can be used - whether it's to finish an uncompleted project, to add on to an existing project, or to pay back investors. In Cohocton Wind's case the project was already finished by January of this year.

Massa said he was told initially that First Wind was going to use the money for repairs to its wind generators, and that the parts would come from overseas - and that would violate the Buy American clause of the stimulus act, he said. But First Wind's Lamontagne says the money might be reinvested in the development of other renewable projects.

"We have no clue where the money's going," Massa said. "We have no way of knowing. They're under no obligation to tell anyone where the taxpayer money is going."

Massa said that his plea to revoke Cohocton Wind's stimulus funding has gone unheeded. The check's been cut, he said, and while he'd like to see the action reversed, he doesn't expect that will happen.

And he doesn't have much faith in the wind companies operating in the Southern Tier: not just First Wind, but Ecogen, and others as well.

First Wind, formerly known as UPC, was one of a handful of wind power companies operating in New York that was investigated by the state attorney general. The office wanted to probe allegations that wind company officials improperly sought land-use agreements, and whether public officials were given improper benefits to influence official actions.

The investigation resulted in a code of conduct, developed by the AG and agreed to by the wind companies. First Wind was one of the initial adopters. The code prohibited wind companies from providing gifts or benefits to municipal officials or their families, and required lease agreement disclosures.

Massa, however, said that some of these companies are already violating the spirit, if not the letter of the code. Ecogen, for example, is suing the Towns of Prattsburgh and Italy, claiming that both town boards have prevented the company from moving forward with proposed wind power projects.

"They have millions and millions of dollars to spend on attorneys and they know these small towns don't have any money at all," Massa said. "What they do is they just go in and overrun the ability of the community to defend itself."