OAH 4-1013-21208-2
PUC IP-6684/CN-08-785
PUC IP-6684/WS-08-1448
STATE OF
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE DEPARTMENT OF COMMERCE
OFFICE OF ENERGY SECURITY
|
In the Matter of the
Applications of Buffalo Ridge Power Partners, LLC, for a Certificate of Need and
a Site Permit for the Bitter Root Wind Farm Project in Yellow Medicine and |
SUMMARY
OF PUBLIC COMMENTS AND
RECOMMENDATION |
Administrative Law Judge Steve S. Mihalchick
conducted a public hearing in this matter on Tuesday, March 30, 2010, at P K
Egans,
Alan R. Mitchell, Attorney at Law, Fredrikson &
Byron, P.A.,
Approximately thirteen members of the public attended the hearing, along with four representatives of Buffalo Ridge. Members of the public were advised that, in addition to making comments at the hearing, they could also submit written comments to Administrative Law Judge Bruce H. Johnson (the ALJ) until April 21, 2010, as stated in the Notice of Public Hearing.[2] Members of the public were further advised that they could also request a contested case hearing in this proceeding or before that date. The ALJ received twelve written comments after the hearing,[3] along with one written request for a contested case hearing.[4]
Description of the Project
Buffalo Ridge Power Partners, LLC (Buffalo
Ridge), is
a joint venture of ACCIONA Wind Energy
A final decision on turbine selection and
design has not been made, but the Project will consist of wind turbines, with
rated outputs between 1.5 and 3.0 MW, in order to produce 138 MW of electrical
power. Each turbine will be connected to
a supervisory control and data acquisition (SCADA) system via fiber optic cable
to allow for real-time monitoring and control of turbine operation. Other associated facilities will include
gravel access roads, a Project substation, an operation and maintenance
building, meteorological towers, and an electrical collection system. The Project will interconnect to the
transmission grid through the Project substation, which will be connected to the
existing 115kV Canby to
Procedural History
1.
On April 27,
2009, Buffalo Ridge filed an application with the Commission for a certificate
of need (CON) for the Project.[5]
2.
On July 7, 2009, the Commission issued an order finding Buffalo
Ridge’s CON application to be complete and authorizing use of the informal
process under Minn. R. 7829.1200.[6]
3.
On October 13, 2009, Buffalo Ridge filed an application with the
Commission for a site permit for the Project.[7]
4.
On March 9,
2010, the Commission approved distribution of a Draft Site Permit for the Project for
public comment and authorized EFP staff to implement the public participation
process set forth in Minn. R.
7836.0900.[8]
Hearing Notice, Public Hearing, and Public
Comment Process
5.
On March 16,
2010, the OES issued a Notice of Availability of Draft Site Permit, Notice of
Availability of Environmental Report and Notice of Public Hearing.[9]
7. On
March 17, 2010, the Notice of Availability of Draft Site Permit, Notice of
Availability of Environmental Report and Notice of Public Hearing was published
in the Canby News, a local newspaper. On
the same day that Notice was also published in the Hendricks Pioneer, another
local newspaper.[10]
8. Administrative
Law Judge Steve M. Mihalchick conducted a public hearing on the Project at 6:30
p.m. on Tuesday, March 30, 2010, at P K Egans,
9. The
Commission will issue an order on Buffalo Ridge’s applications for a Certificate
of Need and a Site Permit after examining this Summary of Public Comments and
Recommendation, a transcript of the public hearing, and all filings and argument
submitted by Buffalo Ridge, the OES, and other persons and entities interested
in this matter.
Summary of
Public Testimony
As the OES Project Manager, Ms.
Steinhauer discussed the responsibilities of the OES with respect to consideration
of Buffalo Ridge’s CON and Site Permit applications, and the actions that that
agency has already taken. She also described
the scoping meeting that OES had conducted in November 2009 and the Environmental
Report on the Project that OES released on March 15, 2009.[11] She also discussed the draft Site Permit that
the Commission had approved. Finally,
Ms. Steinhauer advised members of the public of their right to request a
contested case hearing.
Mr. Kaluzniak explained the
processes that the Commission would follow in making decisions on both the CON
and Site Permit Applications. He also
emphasized that the Commission’s acceptance of Buffalo Ridge’s applications did
not mean that the Commission had already approved those applications. He further indicated that the Commission
would grant a request for a contested case hearing if it concluded that there
were issues of material fact that were not fully developed in the record.
Finally, Mr. Kaluzniak offered
a tentative timeline for further proceedings.
Peter Kennon, representing Acciona Energy
and Buffalo Ridge, is senior development manager for the Project. Mr. Kennon provided background on the features
of and need for the Project. He first indicated
that this Project was being developed by Buffalo Ridge, which is jointly owned
by ACCONIA Energy and Global Winds, and that, when completed, the Project will
be owned by ACCONIA. Finally, Mr. Kennon
indicated that the Project was being developed to help satisfy
Mr. Kennon stated that the Project Buffalo
Ridge was proposing would be a 138 MW Project, using either ninety-two 1.5 MW
or forty-six 3.0 MW wind turbines, and that decisions on turbine size and mix had
not yet been made. The Project will be
located primarily in the southwest corner of
Mr. Kennon further indicated that Buffalo
Ridge had already secured agreements with landowners in the Project areas
covering 12,600 acres and was continuing to negotiate with other
landowners. When completed, the Project
will take approximately 120 acres of land out of production. Additionally, Mr. Kennon stated that all
turbines would be located at least 1,000 feet from existing homes or at a location
where noise levels at homes were 50 decibels (db) or less.
Robert Pollock is a botanist and farmer who
is not participating in the Project and opposes it. If the Project is constructed with 1.5 MW
wind generators, current plans indicate that about fifteen of those wind
generators would be located within three-quarters of a mile from his 280-acre
farm. Based on a Department of Health
study, Mr. Pollock believed that those wind generators would create levels
of noise that would disturb his sleep.
He also believed that the wind generators would impair the scenic value
of his property and thereby reduce its value.
Additionally, it was Mr. Pollock’s opinion that because no Power Purchase
Agreement (PPA) has yet been executed and because necessary transmission
infrastructure has not yet been built, issuing a CON for the Project is not
warranted. Finally, it is Mr. Pollock’s
belief that the compensation that Buffalo Ridge is offering to landowners for
site leases is unreasonably low, and that the presence of wind generators in
the vicinity of his farm will drive up land values and his property taxes.
Deb Peterson also owns property in or
near the Project area. Unlike Mr.
Pollock Ms. Peterson believes that the Project will either not affect the value
of adjacent land or, at most, would only cause property values to increase
slightly. However, she does agree with
Mr. Pollock that the visual presence of wind generators may make it more
difficult for homeowners to sell their homes in the future.
Allan Winter is a supervisor and chairman
of the Fortier Town Board. It was his
belief that the increase in tax revenues that the Project will create will
benefit everyone in the affected counties and townships.
George Peterson lives in
Paulette Wiesen inquired if Buffalo Ridge
had determined whether the Project would be using 1.5 MW or 3.0 MW wind turbines. Mr. Kennon indicated that that decision had
not yet been made because only 1.5 MW were currently being manufactured and 3.0
MW turbines were still under development.
Ms. Wiesen also asked for an explanation of what a “wake loss study”
was. Mr. Kennon responded that when
turbine blades move through the air, they disrupt the flow of wind and create
turbulence that affects efficiency of nearby turbines. A wake loss study measures those effects and
is used to determine optimal spacing between wind turbines.
George Peterson expressed concern that
because 3.0 MW wind turbines were still under development, it is currently not
possible for him and other landowners to comment on what impact they might
have. Mr. Kaluzniak responded that it is
important now for members to articulate as well as possible any concerns they
might have about the use of the larger 3.0 MW wind turbines. When the Commission makes its final decision
about the size of wind turbines, it may adopt Site Permit as currently drafted,
may require the applicant to provide additional information, may specify one
turbine choice over another, or may require additional testing, monitoring, or
setback requirements.
Jim Stone owns property in Section 10 of
Fortier Township; he also serves on the Lyon-Lincoln Co-Op Board. Mr. Stone spoke in favor of the Project,
stating that wind is an important power source because of the environmental
effects of coal-fired plants and the current unavailability of additional
nuclear power plants.
Summary of Written Comments
Lionel Fales submitted comments stating
that he favored the Project and believed that it would not be harmful to
wildlife, would be helpful to area farmers, and would be very beneficial to
small town business.[12]
Ronald Cech, who owns property in
Lewis Miller owns land in
Similarly, Madelene Derostyne Sik is a
landowner who will have a personal financial interest in the Project. She also believed that the entire community
has a financial interest in having the Project constructed because it will
generate income to enable the community to survive in poor economic times.[15]
Mona Evens believed that
It is the opinion of Gary and Julie Van
Hyfte that it will not only be property owners whose land will be rented land
for wind generators who will benefit from the Project. Rather, the Project has already begun
rejuvenating the local economy, with at least two new businesses being planned
for the City of
On the other hand, Lyndon and Laura Moravetz
believed that landowners in the Project area who will not have wind generators
located on their land should receive some kind of compensation for the noise
that will be created and the vistas that will be impaired.[18]
Mark King, Roberta Anson-King, and Kelton
King expressed similar concerns about the Project. They are also concerned that the effects that
3.0 MW on surrounding communities have not yet been studied. The Kings also believed that consideration
should be given to expanding the size of existing wind farms before
constructing new ones.[19]
Robert Pollock also submitted written
comments to supplement the comments that he made during the public
hearing. In those written comments, Mr.
Pollock urged the Commission to reject the Site Permit and CON applications and
requested a contested case hearing for the following reasons:
a. The wind rights documents
that Buffalo Ridge has prepared for use in the Project are not legal.
b. The compensation that
Buffalo Ridge is proposing to pay property owners for wind rights and rent is
unreasonable and therefore represents exploitation of wind resources.
c. There is likelihood of
adverse health consequences resulting from a lack of objective micro-siting.
d. The presence of the wind
generators will degrade the aesthetic value of the landscape.
e. Farmers will experience
increases in land values and real estate taxes due to corporate speculation.
f. The Lease Option
Agreement that Buffalo Ridge tendered to Mr. Pollock is defective for
several reasons.[20]
The Southwest Regional Development
Commission (SWRDC) reviewed the proposed Project and made the following comments:
a. The Yellow Medicine and
Lincoln County Highway Engineers and Zoning Administrators should be invited to
the preconstruction meeting.
b. There should be early
communication between the developer and County Highway Departments regarding
such matters as a road agreement, a structure inventory, a traffic plan, and
permits.
c. The last sentence of Part
III.B.8.(b) of the Draft Site Permit should be amended to read: “Access roads
shall also be located and constructed in accordance with all necessary
township, county or state road requirements and permits.”
d. The title of Part III.B.16
of the Draft Site Permit should be changed from “FIRE PROTECTION” to “EMERGENCY
RESPONSE,” noting that most rural fire departments and EMTs do not have the
expertise to respond to an incident at a large wind energy conversion system. The SWRDC also recommended that the developer
consider conducting training for emergency response personnel in the Project
area.[21]
The Minnesota Department of Natural
Resources (DNR) submitted the following comments and requests:
a. The proposed site plan
layout that include 3.0 MW turbines appears to generally involve less
encroachment of natural resource features and rare habitat. The use of 3.0 MW turbines may be a useful
way to avoid habitat fragmentation or encroachment in some areas with natural
resources by reducing the number of turbines.
The DNR would therefore prefer the use of 3.0 MW turbines for this
entire project or wherever possible.
b. The Yellow Medicine Coteau
Macrosite is an area identified by the Minnesota County Biological Survey
(MCBS) as a large area of significant prairies and a matrix of grassland
connecting those prairies. The DNR
recommends avoiding any disturbance of the Yellow Medicine Coteau Macrosite
because of the rare status of native prairie. It also recommends avoiding disturbance of
connected native prairie, grassland habitat, and MCBS sites of moderate biodiversity
which may provide species movement. Rare
animal and botanical surveys will be required if the proposed project will
impact any native prairie remnants.
c. The DNR identified two 1.5
MW turbines and one 3.0 MW turbine as being sited in areas mapped by MCBS as
native prairie. The DNR recommends
moving those turbines out of native prairie.
The DNR also recommends adjusting turbine locations to avoid creating a
habitat barrier.
d. Although there are
calcareous fens within the Project area, it appears that siting plans do not
contemplate turbines being sited in those areas. Nevertheless, if any dewatering or other
hydrologic alteration is required near a fen during construction, operation, or
maintenance of wind turbines or associated infrastructure, the Applicant should
first contact the DNR.
e. The turbine layout map
shows an access road crossing a waterway, which will require a license from the
DNR Division of Lands and Minerals.
Additionally, studies indicate that avian mortality increases when turbines
are located close to wetlands. The DNR
therefore recommends adoption of the 1.5 MW turbine siting layout which would
site turbines farther away from wetland habitats.
f. DNR recommends conducting
pre-construction surveys that include flight analysis surveys in areas where
rows of turbines may create flight barrier or collisions risks to determine
what micro-siting changes may be necessary to avoid and minimize impacts to
birds and bats.
g. Finally, the DNR
recommends that comparisons be made between pre-construction surveys and two
years of post-construction mortality surveys in order to gain an understanding
of actual impacts at high risk sites, like this Project. This would aid in developing adaptive
management techniques if there is high or rare species mortality at this site.[22]
On April 21, 2009, Alan R. Mitchell
submitted written comments to the ALJ on behalf of Buffalo Ridge. In those comments, the Applicant requested
the Commission to grant both a CON and a Site Permit, noting that the OES staff
had concluded that Buffalo Ridge had satisfied all of the criteria for a CON
and had recommended that a CON be granted.
The Applicant’s written comments also responded to comments made at the
public hearing and written comments submitted after the hearing:
a. The Applicant remarked
that it has been common practice for the Commission to grant CONs and Site
Permits for similar projects even though transmission issues had not yet been
completely resolved. Buffalo Ridge also noted
that although it cannot begin construction until it has an executed PPA,
absence of a PPA does not preclude issuance of a Site Permit. In fact, it has been industry practice that
utilities purchasing power will not agree to a PPA until after the power
producer has the permits necessary for construction in hand.
b. Buffalo Ridge pointed out
that the Draft Site Permit prohibits the siting of turbines and associated
infrastructure in wildlife management areas (Condition III.C.4) and in certain
wetland areas (Condition III.C.5) without first obtaining necessary DNR permits. The Applicant stated that it will comply with
those conditions. The Applicant also indicated
that it will comply with the setback requirement from lands where it does not
hold wind rights. However, the Applicant
commented that elimination of certain turbine locations because of their visual
impact, as suggested by some commenters, would make the Project less efficient
in its use of available wind energy.
That, in turn, would be detrimental to ratepayers and the state’s
efforts to promote renewable energy resources.
c. As required by statute,
the Applicant stated that it will comply with all applicable local standards
established in ordinance by the affected counties. Previously, both
d. Additionally, Buffalo
Ridge noted that only seven turbines will be sited in
e. In both his hearing
testimony and his post-hearing comments, Mr. Pollock asserted that he and
other members of the public would be adversely impacted by low frequency sounds
produced by nearby wind turbines. The
Applicant noted that the issue of sound impacts to residences near turbine
sites had been raised in several previous dockets, and that the Commission has
opened a separate docket to address that issue.[23] The Applicant responded to the claim of
adverse health effects resulting from turbine noise by pointing out that the
Commission has continued to approve wind project applications while that docket
is pending, so long as the projects proposed by applicants conform to the
requirements of existing regulations.
Buffalo Ridge asserted that wind turbine siting for the Project, as
proposed, meets all applicable state noise standards. The Applicant further stated that Condition
III.F.2 of the Draft Site Permit requires it to conduct a noise study of sound
levels at different frequencies at various distances from the nearest turbines,
and that it has agreed not to place any turbines within 1000 feet of a
residence, which is double the distance required in some past projects.
f. In both his hearing
testimony and his post-hearing comments, Mr. Pollock also asserted that construction
of the wind farm would result in increases in the value of his property and
therefore increases in his future real estate taxes. Buffalo Ridge responded to that assertion by
citing a study on the impact of wind power projects on residential property
values, which indicated that there is no evidence that home prices surrounding
wind facilities are consistently, measurably, and significantly affected by the
presence of those facilities.
g. In response to Mr.
Pollock’s contention that the compensation that
h. Buffalo Ridge also
responded to concerns raised by some members of the public about the fact that
Buffalo Ridge has not yet determined the extent to which the Project would be
using 1.5 MW or 3.0 MW wind turbines.
The Applicant stated that the Commission had previously issued site
permits for other wind facilities before the developers had chosen a turbine
model. The Applicant also referred to
Conditions III.A.1 and A.3 of the Draft Site Permit, which requires it to
advise the Commission in advance of construction which turbine model has been
selected.
i. Buffalo Ridge also
addressed the concern that there is currently no provision for interconnecting
the Project to the high-voltage bulk transmission system. The Applicant indicated that it had filed a
Request for Interconnection with MISO on April 11, 2006, and that necessary
Interconnection Agreements were currently being negotiated. The Applicant further indicated its belief
that, as a practical matter, issuance of a Site Permit was a pre-condition to actually
proceeding with transmission upgrades because it would provide the developer
with the degree of regulatory certainty necessary to make those large
investments.
j. Finally, Buffalo Ridge
represented that because it preferred that its applications for a CON and Site
Permit be combined into a single proceeding, it had no objection to the
Commission delaying action on its application beyond the time periods specified
by statute and rule.[24]
No other
written comments from the public were received.
FINDINGS
AND CONCLUSIONS
Based on the record in this proceeding,
the ALJ makes the following Findings and Conclusions regarding the request of Robert
Pollock for a contested case hearing:
1.
Based on a Lease
Option Agreement provided to Mr. Pollock by Buffalo Ridge, Mr. Pollock contends
that the wind rights documents that Buffalo Ridge has prepared for use in the
Project are not legal because: (a) the legal description for that property was
inaccurate; (b) the document had not been properly notarized; and (c) there was
no indication of who prepared the document, as required by Minnesota law.[25] The fact that the particular Lease Option
Agreement that was tendered to Mr. Pollock may have had those legal defects
does not establish that Lease Option Agreements that Buffalo Ridge has actually
executed with other landowners had similar defects. Moreover, the Commission lacks jurisdiction
to determine the legal adequacy of any Lease Option Agreements that Buffalo
Ridge may have entered into in connection with the Project. This contention therefore does not raise
issues of fact that are material to the outcome of this proceeding.
2.
Mr. Pollock also
contends that the compensation that
3.
Mr. Pollock,
along with some other members of the public, expressed concern about likelihood
of adverse health consequences resulting from the proximity of residences to
wind turbines. He makes reference to the
Department of Health study, Public Health
Impacts of Wind Projects.[27] To the extent that issues of material fact
exist regarding the health effects in residences caused by low frequency sounds
produced by nearby wind turbines, the Commission has chosen to address those
issues in a separate pending docket. The
ALJ therefore concludes that addressing those issues in a contested case
hearing in this matter would be duplicative of actions that the Commission has
already taken and, therefore, unnecessary.
4.
Mr. Pollock also
contends that landowners will experience increases in land values and, therefore,
in their future real estate taxes if the Project is constructed. In response, Buffalo Ridge cited a study entitled,
The Impact of Wind Power Projects on
Residential Property Values in the United States: A Multi-Site Hedonic Analysis,
published by the Ernest Orlando Lawrence Berkeley National Laboratory in
December 2009,[28]
on the impact of wind power projects on residential property values. That study concluded:
The
various analyses are strongly consistent in that none of the models uncovers
conclusive evidence of the existence of any widespread property value impacts
that might be present in communities surrounding wind energy facilities. Specifically, neither the view of the wind
facilities nor the distance of the home to those facilities is found to have
any consistent, measurable, and statistically significant effect on home sales
prices. Although the analysis cannot
dismiss the possibility that individual homes or small numbers of homes have
been or could be negatively impacted, it finds that if these impacts do exist,
they are either too small and/or too infrequent to result in any widespread,
statistically observable impact.[29]
As evidence for his position, Mr. Pollock offered a
copy of a St. Paul Pioneer Press newspaper article, which contained a statement
by Lisa Linowes, executive director of the Industrial Wind Action Group, who
said “[T]he study was flawed because it compared properties that varied too
widely in age and market price.”[30] Mr. Pollock also submitted tax records
showing increases in recent years in the assessed value of his property and his
property taxes.[31] However, those tax records fail to establish
that the any revaluation of Mr. Pollock’s property was based on the impending
Bitter Root Project, rather than on other market factors. In summary, although the impact of wind
facilities on the market value of adjacent and nearby lands may be a disputed
issue of fact, the only current objective evidence on the subject is the
5.
Mr. Pollock also
indicated that a contested case hearing was necessary to develop the issue of
whether the presence of wind generators will degrade the aesthetic value of nearby
properties. However, the only objective
evidence cited by anyone that could reasonably shed light on that issue is the
Livermore Study, mentioned above.
Because of the highly personal and subjective nature of individual
opinions about aesthetics and because of the absence of any other objective
evidence, the ALJ concludes that a contested case hearing addressing possible
degradation of aesthetic values is unlikely to develop the factual record more
fully.
6.
In view of the
above, the ALJ concluded that a contested case hearing is not likely to develop
the material issues of fact in this proceeding more fully.
RECOMMENDATION
Based upon the Findings and Conclusions
set forth above, the Administrative Law Judge respectfully recommends that the
Commission DENY the request of Robert Pollock for a contested case hearing.
Dated: May 3, 2010
s/Bruce
H. Johnson
|
BRUCE H. JOHNSON Assistant Chief
Administrative Law Judge |
Reported: Shaddix and Associates
Christine Simons, Ct Reporter
Transcript Prepared
NOTICE
This
report contains a summary of public comments.
It is not a final decision. Pursuant
to Minn. R. 7850.3900, the Commission will make the final determination of the
matters at issue after receiving the public hearing record from the ALJ.
[1] Notice of Public Hearing (https://www.edockets.state.mn.us/EFiling/ShowFile.do?DocNumber=20103-48060-01)
[2] Transcript (Tr.) at 5, 10.
[3] These comments have been marked as Public Comment
Nos. 1 through 12.
[4] Public
Comment No. 9.
[5] Application for a CON (https://www.edockets.state.mn.us/EFiling/ShowFile.do?DocNumber=20094-36828-03).
[6] Order Finding CON Application to be Complete (https://www.edockets.state.mn.us/EFiling/ShowFile.do?DocNumber=20097-39366-01).
[7] Application for Site Permit (https://www.edockets.state.mn.us/EFiling/ShowFile.do?DocNumber=200910-42787-06).
[8] Environmental Report (https://www.edockets.state.mn.us/EFiling/ShowFile.do?DocNumber=20103-48016-01).
[9] Notice of Public Hearing
(https://www.edockets.state.mn.us/EFiling/ShowFile.do?DocNumber=20103-48060-01
).
[10] Affidavits of Publication.
(https://www.edockets.state.mn.us/EFiling/EFiling/ShowFile.do?DocNumber=20103-48016-01=20104-48827-01
)
[11] Environmental Report
(https://www.edockets.state.mn.us/EFiling/ShowFile.do?DocNumber=200911-44359-01)
[12] Public Comment No. 1.
[13] Public Comment No. 2.
[14] Public Comment No. 3.
[15] Public Comment No. 4.
[16] Public Comment No. 5.
[17] Public Comment No. 6.
[18] Public Comment No. 7.
[19] Public Comment No. 8.
[20] Public Comment No. 9.
[21] Public Comment No. 10.
[22] Public Comment No. 11.
[23] See PUC Docket No. M-09-845.
[24] Public Comment No. 12.
[25] Public Comment No. 9.
[26] Public Comment No. 9, Tab 2.
[27] Public Comment No. 9, Tab 3.
[28] , The Impact of Wind Power Projects on Residential
Property Values in the
[29]
[30] Public Comment No. 9, Tab 4.
[31] Public Comment No. 9, Tab 5.