Wind farm owner sues Duke Energy Indiana

December 28, 2013 by  
Filed under Green Energy News

INDIANAPOLIS – The owner of a northern Indiana wind farm is suing Duke Energy Indiana Inc., accusing it of breach of contract involving the utility’s deal to buy electricity from the farm.

Earl Park-based Benton County Wind Farm LLC filed its suit in federal court in Indianapolis. The suit, which seeks unspecified damages, claims Duke Energy Indiana hasn’t honored its agreement.

Many of the details of Duke Energy’s alleged contract breach are redacted in the 23-page complaint. But those that aren’t allege the utility’s actions have resulted in the wind farm “frequently” being forced to curtail operations, causing sharp reductions in the farm’s electrical output and revenue.

An executive for one of the wind farm’s parents, Oakland, Calif.-based Orion Energy Group, declined to say whether the alleged revenue shortcomings have placed the farm in jeopardy.

“If it was not significant, we would not have filed the complaint,” Jim Eisen, Orion’s general counsel, told The Indianapolis Business Journal ( ).

A Duke Energy spokeswoman said only that the company is reviewing the lawsuit.

Orion Energy Group LLC began running the wind farm in 2008 as Indiana’s first commercial-scale operation, with 87 power-generating wind turbines northwest of Lafayette. In 2006, the companies struck a 20-year contract under which Duke Energy would buy 100 megawatts of electricity produced by the wind farm once it went online.

Duke Energy takes the electricity and sells it onto the power grid through the Carmel-based Midcontinent Independent System Operator Inc., or MISO.

MISO’s pricing system and a glut of wind energy appear to be at the root of the court case, according to the Indianapolis Business Journal.

Duke Energy has to pay a fixed price – which was redacted from court records – to Benton County Wind Farm, regardless of what Duke earns reselling through MISO.

The lawsuit states Duke Energy is only excused from its obligation to pay the wind farm in “narrowly defined” emergencies.

The complaint redacts the specifics of what Duke Energy allegedly did, noting only that the utility “curtail(ed) electrical production by refusing to offer the Wind Farm’s power to MISO at competitive prices and then refusing to compensate (the wind farm) when the Wind Farm is directed by MISO not to produce power.”

A 2012 report by Synapse Energy Economics Inc. in Cambridge, Mass., found that MISO’s transmission grid wasn’t able to handle the power generated by Indiana’s growing wind energy industry.

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