Wind farms could be Knox County’s newest crop

 

by Mike Kroll

 

“This is one of the windiest areas of Illinois,” stated Michael Arndt, development manager for Invenergy, LLC, a company that wants to construct an $800 million wind farm consisting of 266 turbines in northwest Knox County. In a roughly triangular area bounded by Route 150 to the west, the Knox County line to the north and with the hypotenuse running from the outskirts of Wataga to east of Galva this area makes up over 40,000 acres of farmland. Farmers across this area are being asked to permit “easements” on their land to locate the 262 foot tall towers. The project is named “Pilot Knob Wind Energy Center” and construction is expected to be complete with the towers in operation by late 2009 or early 2010.

Pilot Knob comes on the heels of a very similar project in Henry County called Bishop Hill. That project will also feature 266 turbines and Invenergy has already lined up all the participating landowners and sited out the locations of each turbine across some 30,000 acres of land in south central Henry County. Arndt says that the Henry County project has completed all the permits and has only been delayed by complications in the interconnect with the power grid. Construction in Henry County should precede that of the Pilot Knob project and begin operation in 2009.

On Tuesday evening the Knox County Farm Bureau hosted a public forum on this project at the Agri-Center on South Soangetaha Road. It was a packed room full of mostly farmers who came to here the Invenergy pitch. Arndt described the company as one of the top five wind energy developers in North America with more that $1.1 billion of wind energy projects either completed or in process. Invenergy has already completed eight projects totally 450 wind turbines and generating 680 mega watts of electric power annually. All of their projects use American-made General Electric wind turbines that can each generate 1.5 mega watts of electricity.

When completed Pilot Knob would become one of the largest wind farms in Illinois with turbines sited across at least four or five townships. These tall, graceful white structures will reach a total height of over 400 feet (including blade length) and must be sited at least 2,500 feet apart from one another. The footprint of the tower is 16 feet in diameter at its base but the concrete foundation each tower sit upon is much larger. Arndt described an underground octagonal concrete foundation 48 foot across and up to 8 feet deep at its center. A total of over 300 cubic yards of concrete goes into each such foundation and each wind turbine is accessed by a service road of 16 foot width.

This portends of an economic development opportunity for rural Knox County. The company estimates that about 150 temporary jobs will be created during the construction phase of the project. Project construction could take from six to nine months and is expected to begin in the spring of 2009. Once in operation Arndt said there would be 16-18 full-time regular employees responsible for operation, maintenance and management of the Pilot Knob project with an annual operations budget of more than $3 million.

According to Arndt, wind currents at the height of these turbines are almost always sufficient to generate some amount of electricity. However, it takes wind speeds of about 25 miles per hour to generate electricity at full capacity on a wind turbine. “These turbines should perform at full capacity at least 38-40 percent of the time and at capacity a single turbine generates sufficient electricity to power 350-400 homes. Wind speeds beyond 25 miles per hour do not generate additional power and at really high wind speeds the turbines are designed to feather their blades and actually stop rotation.

For area farmers this is an opportunity to earn a guaranteed additional income for a relatively small loss of farmland. Lee Pemberton, site manager for Pilot Knob explained that farmers are paid $6,000 per turbine each year over a 25-year contract with a ten-year renewal option. During the contract an inflation escalation clause automatically increases the payment amount by two percent annually. This would total at least $1.6 million in payments to land owners beginning year one.

Arndt touted the potential property tax benefits to the area as well. He estimated that once completed the Pilot Knob project would generate more than $2.6 million in additional property taxes annually. Most of this additional tax money would go to financially-pressed school districts, particularly ROWVA schools. However, the property tax issue is also the seemingly largest question mark in the minds of landowners. At the present time it isn’t even determined how each wind turbine would be valued for property tax purposes and the mechanism for collecting the tax itself concerns a number of farmers.

Unlike most residential or commercial property, farmland uses for production or livestock is not taxed on the value of the land and improvements but rather based on agricultural productivity. Wind farms are still new to Illinois and while state lawmakers want to establish a state-wide standard for determining property taxes on turbines that hasn’t yet been accomplished. Furthermore, there is the issue of collecting that property tax.

Chris Gray, deputy supervisor of assessments for Knox County, explained that under current law landowners are ultimately responsible for all assessed property taxes on their property regardless of leasing or easement contracts. Arndt said that Invenergy would prefer that a mechanism was created enabling Knox County to bill Pilot Knob directly for its share of property taxes each year leaving the landowner essentially unaffected but it remains to be determined if that can be legally done without a change in state statutes.

This issue has huge potential impact on area farmers contemplating participation in the project — a number of whom said that while they supported the project they were unwilling to expose themselves to the financial risk of the property taxes. In most cases farmers pay trivial amounts of property taxes even in highly productive years for tillable land but the tax on a single wind turbine could easily dwarf their entire property tax bill on hundreds of acres of farm land. It  almost surely would exceed their annual contract payment from Invenergy. Some estimates are that property taxes on each turbine could be as much as double the annual easement payment to the landowner. Arndt says he expects property taxes to come to about $8-10,000 per turbine, depending on the method of valuation and assessment.

Another issue of concern to some local farmers is the impact of these turbines on their farming operation. There are two issues here. One concerns the amount of tillable acreage that is lost to the turbine itself and its access road. The second is the impact of the turbine and access road on farm operations. Arndt explained that at Invenergy’s other similar projects farmers raise crops right up to the base of each turbine and that the company places no restrictions or limitations on how the farming is done. If there is a negative impact on farm productivity due to construction or operation of a wind turbine Invenergy is contractually obligated to compensate the landowner.

While 266 huge turbines is a lot they will be spread over more than 40,000 acres of property and must adhere to state and local codes and setback restrictions. Each turbine has an 80 acre footprint with regard to the location of nearby turbines. Turbines must be located at least 1,000 feet from any occupied structure owned by a non-participating owner and 1.1 times the total height of the tower from any road, utility line or non-participating property line.

Pilot Knob’s Pemberton is responsible for obtaining the necessary easements for landowners in the project area. Each landowner delineates the areas where he does not want turbines or access roads constructed as part of the contract but once so committed Invenergy is free to site turbines and roads wherever the company sees fit within the county zoning limitations. For large landowners it is not only possible but likely that multiple wind turbines will be sited on their land. The company takes numerous conditions into consideration during the siting process including available winds and easy and efficient access to each turbine site but Arndt says they want to work with landowners to keep everybody happy.

“Most of the time landowners want us to place as many turbines on their property as possible for the revenue generating capability,” explained Arndt. “The actual siting of turbines is by no means a trivial task and lots of factors go into the calculations and decision-making process. My goal would be to lineup our easements and determine siting before year end this year and this is of course necessary for us to obtain the necessary permits and approvals from Knox County.”

Governor Rod Blagojevich  has set a statewide goal of generating eight percent of Illinois’ electrical power from renewable sources by 2013 and wind farms will need to account for much of this. Today only one percent of Illinois electricity comes from renewable resources. The vast majority of Illinois electricity is generated with non-renewable and environmentally unfriendly coal. Air emissions from coal-fired power plants are a significant source of carbon dioxide greenhouse gases that contribute to global warming. Wind farming generates no air emissions and uses naturally occurring wind as “fuel,” a resource that is otherwise untapped.

While no one at the Farm Bureau forum questioned the aesthetics of wind turbines this has become an issue in other places. There are people who simply do not like the look of these tall towers dotting the landscape and who will likely object when Invenergy goes before the Knox County board for permit approval. While these turbines are undeniably very tall and noticeable it does seem hard to consider them any less attractive than high-tension power lines that already criss-cross the countryside or the now ubiquitous cellular towers that are found everywhere or the blight of billboards that dot our highways.

Invenergy has established an office in Galva to serve both the Pilot Knob and Bishop Hill projects. Trudy Kremer operates the Invenergy office at 331 Market Street and Lee Pemberton operates out of that office as he seeks out contracts with local landowners. At this stage Pemberton has signed commitments for options with 38 landowners on about 5,300 acres and his goal is to obtain options on nearly 40,000 acres. Not all of those who sign the contracts will have a turbine sited on their property but the company’s goal is to line up as much potential acreage as possible to make the siting process easier. Landowners interested in speaking with Kremer or Pemberton are urged to call 309-932-2700.

6/21/07