A deflating benefit

In 2008, then-Gov. John Baldacci worked with a very cooperative Legislature to craft a special zoning and permitting process that significantly aided developers seeking to capitalize on Maine’s rural resources for large-scale wind power projects.

Developers promised massive “green” benefits for Maine’s energy generation, a huge economic impact with hundreds of high-paying jobs, all while showering small rural towns and unorganized territories and county governments with millions of dollars through the Wind Power Law’s Community Benefits provision. These enticements lured government officials to secure TIF – Tax Increment Financing – arrangements that deferred tax assessments, because in the end, these communities would still reap large sums of new revenue. The TIF was needed to “make the project more enticing to investors.”

With momentum mounting and a quiver full of rebuttal arrows to beat back any challenges, proposed wind power projects rapidly increased across the state, as well as in rural Hancock County.

We have since learned, in the last nine years, that the majority of the wind power generated here ends up being sent out of state and has had little impact on reducing our own oil and gas-fueled electricity generation consumption; that huge transmission lines must be constructed to move the power out of state; and that the promised jobs are primarily the same skilled contractors and crews that move from project to project with few, if any, local jobs created. In Hancock County’s Bull Hill wind project, fewer than 10 employees now staff all of the functions. Not quite the hundreds of jobs promised by developers.

We also have learned that wind power companies change hands – and names – a lot, yet the principal players may not change at all. Hancock County’s First Wind was consumed by SunEdison, billed at the time as “the world’s largest renewable energy company.” With Sun Edison now working through bankruptcy, one of its divisions, TerraForm Power consumed First Wind. And, not surprisingly, Baldacci is now vice chairman of Avangrid, the second largest wind power company in the United States. Iberola S.A. of Madrid, Spain, a world wide leader in the energy industry owns 81.5 percent of Avangrid.

Most relevant locally is the latest revelation that Hancock County will not reap the promised property tax revenues worked out in the original TIF agreement with First Wind for the Bull Hill project near Eastbrook in Township 16. That wind farm is the long row of flashing red lights visible at night to the north from the top of Cadillac Mountain.

The original agreement outlined tax revenues to Hancock County of $4.7 million over a 20-year period. Valuation issues, changing tax rates and ownership changes combined to all but guarantee that the county will see a vastly reduced amount of tax revenue during the outlined time frame.

Given the consequences thus far realized from the faulty positions proposed, what is to say that the Community Benefits payments are assured? Currently, Hancock County receives $400,000 a year, which previously had been shared with nonprofit groups, and this year, was used to lower property taxes. Because all citizens pay for power and all property owners pay taxes to the county, such money should be used only for lowering the various communities’ overall tax burden.

Wind power continues to play a role in meeting our renewable energy objectives, yet Maine’s wind power law, as Gov, LePage has consistently proclaimed, needs to be drastically changed. Several massive-scale projects are under consideration across the state that would send more power to Connecticut, Rhode Island and Massachusetts and require that huge transmission corridors be constructed. Dozens of Maine’s rural communities and townships have opted out of the fast-track wind power zone (which streamlines permitting approvals for wind developers). The new Legislature is scheduled to review the reviled Renewable Portfolio Standards program – work that even environmentalists agree needs to be modified. Particularly egregious is that current legislation totally disenfranchises residents and taxpayers of unorganized territories from any say concerning wind projects in their area.

Warren Buffett stated that wind power projects “don’t make any sense without the tax credits.” Perhaps the whole TIF and Community Benefits inducement package should be abandoned for straight-face, up-and-down viability for future wind power projects.

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