Wind-farm operations improperly curtailed by Duke Energy Indiana, suit claims

December 30, 2013 by  
Filed under Green Energy News


An Indiana wind farm says Duke Energy Indiana used recent changes in rules governing Midwest wind power plants to force the farm to curtail its operations, letting Duke avoid paying for power it has contracted to buy.

John Downey
Senior Staff Writer- Charlotte Business Journal

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An Indiana wind farm has filed a federal lawsuit against Duke Energy Indiana for unspecified damages, claiming that Duke (NYSE:DUK) is violating agreements it made requiring it to buy a portion of the power produced by the 130-megawatt project.

Duke is studying the complaint and expects to “aggressively defend” itself in the suit.

The Becton County Wind Farm, owned by Orion Energy Group and Vision Energy, was built in 2008, spurred by an agreement with Duke to buy the power produced by the first 100 megawatts at a fixed price. The complaint says Duke is required to buy the power regardless of whether it can resell it at a profit.

And Duke is bound by a power-purchase agreement and joint energy-sharing and operating agreement not to do anything that would “curtail or reduce” the wind farm’s output, the suit says.

Becton says Duke adhered to the agreement until March of this year, when the Midwest Independent Service Operator changed its market rules for wind plants. Under the new rules, Becton says, “Duke forced BCWF to curtail electrical production by refusing to offer the wind farm’s power to MISO at competitive prices,” which led MISO to instruct the wind farm to stop producing power.

Much of the 23-page complaint is redacted to protect proprietary information, according to Becton.  You can find the document here.

It alleges that Becton’s “electrical output and revenues have been sharply reduced” and that “Duke’s position is contrary to both the letter and the spirit of the (Power Purchase Agreement).”

Duke spokesman Lew Middleton disputes the claims.

“We believe the lawsuit inappropriately characterizes our obligation under the contract,” he says. “We are prepared to aggressively defend our position in court.”

The suit was filed Dec. 16 in the U.S. Court in Indianapolis.

Duke Energy Corp., the nation’s largest electric utility, is based in Charlotte.

John Downey covers the energy industry and public companies for the Charlotte Business Journal.

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