Minnesota first passed Community Based Energy Development law in 1995. The idea was to “optimize local economic development in the communities in which [Minnesotans] live and work.” The idea of C-BED is to “foster, promote, and secure the local economic development benefits attached to renewable energy production facilities that are owned by ordinary members of local communities.”
The idea sounded good on paper: keep more of the tax and rate money being spent on industrial wind turbines in the state and make it easier for Minnesota owned projects to secure financing. Unfortunately, anytime government picks winners, there are unintended consequences. Big multinational and out-of-state investors saw that simply by registering a shell corporation in Minnesota, they could be considered a “local entity”. Along with a few other "low-bar" requirements, this offers favored treatment by utilities that are mandated by law to give preference to C-BED projects. C-BED status allows the project to secure even higher electrical rates in their state regulated power purchase agreement than other already pricey wind rates.
The Minneapolis StarTribune recently ran a pair of opinion pieces on C-BED. “The bounties of renewable energy need to stay at home”, December 29, 2011, featured state elected officials explaining the intent of the C-BED legislation. Representatives Steve Drazkowski and Tim Kelly joined Senator John Howe in their observations that wind companies usage of C-BED appears to have strayed from legislative intent. They called for an investigation into C-BED.
January 17, 2012’s paper carried Fredrikson and Byron lawyer Dan Yarano’s explanation of C-BED. “Evaluate wind projects factually”, does not further citizen understanding. Yarano’s explanation of C-BED is best understood in the context of that infamous Bill Clinton quote, “It depends what the meaning of the word ‘is’ is.”
He is correct about the 2005 passage and the stated legislative and gubernatorial intent; he forgot to mention that C-BED law has been modified almost every year since then largely through lobbying efforts by his firm.
T. Boone Pickens’ AWA Goodhue wind project meets the requirement of no single qualifying owner with more than 15% because, apparently, there are zero qualifying owners. T. Boone Pickens’ Mesa Power bought the project in December 2009 and is the sole owner.
The requirement that 51% of net revenues from a power contract flow to Minnesotans can only possibly be met if expenditures are counted as revenue and if one counts expenditures made prior to power production as being “from a power contract”. Even then it appears doubtful AWA Goodhue can meet the 51% mark unless we count T. Boone Pickens’ income from a “Minnesota corporation” with no organizers or employees residing in MN. The developer, National Wind, is based in Minneapolis but is 'gone' as soon as construction begins, according to Mesa’s Mark Ward.
Yarano failed to mention the third criteria for C-BED status: County resolution of support. Goodhue County passed a very specific resolution in late 2008. Almost none of the characteristics described in the County resolution exist in the current project.
Yarano’s opinion piece also omitted that the “local ownership” that AWA Goodhue testified they expect after electrical production starts will be 1% by Ventum Energy LLC. This corporation did not exist when the MN Public Utilities Commission granted the project C-BED status.
“Community support” is not a legal requirement for a C-BED project, but it is implied. C-BED is marketed to the legislature using lovely descriptions of local farmers banding together to bring C-BED to life. AWA Goodhue enjoys support by perhaps 10% of affected land and home owners. Due to relentless participation by citizens of the actual “community”, AWA Goodhue is Minnesota’s most controversial industrial wind project, and one of the most contentious projects in the nation.
Minnesotans should not be satisfied when a tiny percentage of your own tax and electrical rate dollars stay in, or come back to, Minnesota. This is particularly true when most of the money appears to benefit lawyers, lobbyists and wind developers along with foreign and out-of-state investors. The federal government expended about $100 billion on renewable energy since 2008. Last year a conservative estimate showed Minnesotans ponied up about $100 million in additional electrical rate costs since enactment of the State’s 2007 renewable energy standard.
Minnesota’s C-BED law may have sounded like a good idea in 2005. In 2012, C-BED is a clear example of “Government of the lobbyists, by the lawyers, for the benefit of corporations they represent”.
The Coalition for Sensible Siting supports citizens voices in the industrial wind arena. We support legislators call for C-BED investigation.
"When injustice becomes law, resistance becomes duty." ~ Thomas Jefferson
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