Wind farm could be largest taxpayer

March 9, 2014 by  
Filed under Green Energy News

Making an initial appearance before county commissioners on Friday to outline a proposed tax abatement agreement for Hale Community Energy LLC, local attorney Lanny Voss said the wind energy project could soon become one of Hale County’s largest taxpayers.

In addition to serving as legal counsel for the wind energy project, Voss also is a manager of one of its wind farms. On Friday he offered an initial draft of the group’s tax abatement application. He was joined at the commissioners’ work session by Mike Price and David McCauley.

The three explained that Phase 1 of the project, set for construction in 2015, will have taxable assets of about $365 million.

As part of a reinvestment zone, the project will qualify for 100 percent tax abatements for 10 years, before going on the tax rolls at a value of $100,000 per megawatt production capacity. Despite the proposed tax abatement, the project will pay the county $300,000 annually in “pilot payments,” based on a capacity of 300 megawatts.

Since the massive project is being stair-stepped, Phase 2 is scheduled to begin before Phase 1 is fully operational.

Voss explained the timetable for payments, indicating that if a certificate of notice on construction is filed by the end of 2015, then the first payments are due by Oct. 1, 2016.

“Based on 300 megawatts, the project will eventually be paying about $1.8 million in taxes per year,” he said.

Price added that the wind farm project is truly a community effort with about 98 percent of the initial $5 million investment raised locally. “Everybody has skin in this game. We’re all each other’s friends and neighbors.”

In a related note, Voss referred to published accounts that BNSF Logistics and Tri Global Energy on Feb. 25 entered a strategic partnership to develop a local hub to receive and distribute the blades and various other components needed to construct wind turbines in the area.

Although the precise location of the handling facility has not been announced, Plainview/Hale County Economic Development Corp. Executive Director Kevin Carter said it likely will be located in the vicinity of County Road AA and US 70, near the Plainview Co-op Compress. White Energy President and CEO Don Gales acknowledged that his firm has been in contact with BNSF in connection with the proposal.

According to Voss and others, the wind turbine components would be delivered to the facility. From there, they would be delivered by truck to construction sites in Briscoe and Floyd counties and other areas are no longer served by rail.

A joint release by BNSF Logistics and Tri Global Energy notes that a site already has been selected that is strategically situated in the heart of Tri Global’s proposed project plans, and development is already under way. The initial stage calls for development of 40 acres, though BNSFL holds an option on the entire 200-acre site. When fully developed, the site will be receiving, storing and loading out hundreds of turbine components each month, receiving components via both rail and truck.

“Having a freight and logistics powerhouse like BNSFL bringing their resources and expertise to boost TGE’s West Texas projects provides a critical element supporting our overall vision,” said Tri Global’s CEO John Billingsley. “West Texas has emerged as the ‘bulls-eye’ for wind energy projects in North America, due to ideal wind speeds, geography and being at the nexus of the three U.S. power grids.”

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