Money, power and the County

County negotiating with developer despite Tribunal finding that project poses serious and irreversible risk to endangered species

Do Tribunal rulings matter? Why is the developer making preparations to clear the project land of vegetation? Why is the Ministry of the Environment and Climate Change (MOECC) continuing to work with the developer to prepare stormwater management plans? And why, folks are asking themselves this week, is this County making deals to profit from this project?

Many County residents were both surprised and dismayed that the developer was intent on proceeding with construction despite a ruling by an Environmental Review Tribunal in late February that determined the project poses a serious and irreversible threat to the Blanding’s turtle and the little brown bat—both endangered species.

It turns out the County’s staff and lawyers have also been busy in the meantime, hammering out a deal with the developer that will see the municipality receive financial benefit from the project.

Still, the developer managed to negotiate a good deal for itself and its investors. The County policy that spells out compensation for such projects dictates the developer will pay $7,500 per MW plus profit sharing of four per cent, escalating at the rate of inflation over time.

wpd Canada, however, rejected that arrangement, agreeing instead to pay less than half the per-megawatt rate ($3,414) sought by the County, and none of the profit sharing. County staff is recommending council take it.

The agreement also prescribes the standards by which the developer will improve County roads to be used to supply and service the project. It also points to a framework deal, whereby the developer might unfix them after construction, should the Tribunal determine this will protect the Blanding’s turtle.

County staff and its solicitors argue that the municipality could lose control over the project, as it affects its roads and rights of way, if it doesn’t make this agreement with the developer. They worry the MOECC will simply give the developer the go-ahead and the municipality will be a bystander as its roads and lands are fundamentally altered.

But others believe the County is playing into the developer’s hands.

“We think this is completely disrespectful of the Tribunal process,” said Orville Walsh, chair of the Alliance to Protect Prince Edward County (APPEC). APPEC led the fight that appealed the White Pines project to the Tribunal. “This agreement gives prior approval of some of the very issues that are still to be ruled on by the Tribunal. We suspect that wpd Canada is anxious to have a Road Users Agreement finalized before the resumption of the ERT in order to use it to support its legal case.”

Mayor Robert Quaiff says the compensation agreement amounts to blood money.

“I want no part of them or this agreement,” wrote Quaiff to his council colleagues on Monday. “I urge you to join me in voting a resounding no way on Thursday.”

Garth Manning, a director of CCSAGE Naturally Green said his organization supports Mayor Quaiff’s position on this issue and his work in general in keeping the County free of industrial wind turbines. Manning, too, notes the disrespect to the Tribunal of negotiating community benefit while the project’s fate is still being considered.

“It’s typical of the arrogant attitude of wpd in bringing this forward when the White Pines REA no longer exists, or, at the very least, is suspended,” said Manning. “It is right up there with its notification of starting work as if it hadn’t heard of the ERT’s thumbs down at the first hearing.”

Further, Manning notes some troubling language in the proposed agreement.

“We have found disturbing elements in both in favour of White Pines and not in the County’s interests,” said Manning.

Councillor Bill Roberts struck a more moderate tone, noting that he has no doubt the planet needs to wean itself from carbon-based fuels. He further added it was appropriate for County staff to hammer out a deal with the developer. But he says council has a different duty.

“It’s not just about road use, permits, road damage, and restoration,” said Roberts. “It’s also about the fact that the County has become a bellwether, a practical symbol for getting the renewable energy equation correct between corporate heavy-handedness, even entitlement, and the sustainability of a unique County environment—and importantly—our aspirations to build on that legacy to encourage a heritage-rich, diverse and attractive place to prosper.

“So it’s not an accident that we’re on the record as being an ‘unwilling host’. And it’s no less accidental that the proposed wpd ‘deal’ provides half the rate prescribed in the County’s own criteria for consideration, none of the profit-sharing and is timed to be announced before the Environmental Review Tribunal for the White Pines project in Athol and South Marysburgh finishes its job.

“The right thing to do, in my view, is to defer council’s decision on this matter until the Tribunal renders a final decision,” said Roberts.

The Deal

wpd Canada has agreed to a Road Users Agreement (RUA) that specifies certain requirements and remedies regarding routes, load sizes and the nature of road improvements required. The County will also prescribe project entrances and pole alignment in municipal road allowances. It has also worked out a decommissioning plan plus security to ensure each turbine is carted away and that roads are restored when the project is abandoned.

wpd Canada has agreed to post a $2.75 million security in the County’s favour should the developer fail to comply with the provisions of the deal.

wpd Canada has further agreed to pay the County $7,000 per turbine (currently specified at 2.02 MW each) for the first 10 years, rising to $8,500 for the next five years and $9,500 for the final five years of the developer’s 20-year power purchase agreement.

That works out to $189,000 to be paid annually by wpd Canada to the County for the community’s benefit. Any other industrial plant investing between $80- and $100 million in the County, however, would be liable to pay upwards of $1 million in municipal taxes—but the Green Energy Act limits the value of industrial wind energy projects to just $40,000 per megawatt. Adding a few buildings and the land underneath the turbines, the total value for assessment purposes is just over $3.1 million for the White Pines project—a fraction of its investment. Taxes payable to the municipality, therefore, would be just over $38,000 per year.

The County can, therefore, look forward to collecting a total of about $250,000 per year including the compensation benefit fund from White Pines—about a quarter of what it would generate from a similar-sized industrial investment not governed by the Green Energy Act.