Cape Cod Times Article

Orleans accord heralds municipal wind project
Cape Cod Times  |  May 19, 2006
Jason Kolnos

ORLEANS - The town and its technology partner agreed this week on key parts of a financial agreement to build two wind turbines on a section of town-owned land.
Orleans hopes to become the first Cape town to generate electricity from wind for municipal uses.

The 262-foot-tall turbines would supply power to a water treatment plant located within the town's 500-acre watershed.

Under business terms hashed out by the town's wind energy committee, the board of water commissioners and the Massachusetts Technology Collaborative this week, Orleans stands to receive between $1.6 million and $2 million over the life of the 20-year partnership without any capital contributions from taxpayers.

Wednesday's latest offer from the collaborative, a quasi-state agency that will develop and fund the estimated $7.3 million project, also includes the potential for Orleans to save about $30,000 each year with wind-generated electricity.

Officials cautioned that acceptance of the financial arrangements does not mean the project is a done deal. Next week, lawyers will finalize details of the lease agreement before a request for proposals can be issued to begin the construction phase.

The goal is to get the blades of the turbines spinning by late fall.

''Though we don't see any insurmountable hurdles, it's not over until it's over on a project like this,'' said Warren Leon, director of the collaborative's renewable energy trust. ''We think we're on track for a successful conclusion.''

As landlord, Orleans would receive an annual payment from the collaborative in lieu of taxes, initially set at $64,000.

After every three years, this ''rent'' would increase by 7 percent. In year four, the annual payment would be $68,480; in year seven, $73,274.

In addition to the payments, Orleans will have the right to use up to 170,000 free kilowatt-hours of electricity generated by the wind turbines annually. The town also has the option to buy additional electricity at a discounted price.

The current proposal assures the town several hundred thousand dollars more over the 20-year period than a previous offer, board of commissioners chairman Kenneth McKusick told selectmen Wednesday night. His board is involved because it oversees the watershed.

Kevin Galligan, the chairman of the town's wind energy committee, estimates the water treatment plant uses 475,000 kilowatt-hours of electricity. Currently, the town pays a retail price of 17 cents per kilowatt-hour, Galligan said.

''If electricity costs soar as the years go by, the value of that free, on-site electricity generated from the turbines is going to create more savings for the town,'' Galligan said. ''We have a great opportunity and we'd like to see this move forward, so I think this is a good deal for Orleans.''

The board of water commissioners voted 2-1 to accept the latest proposal, with commissioner Robert Rich dissenting. He warned selectmen Wednesday night to keep their guard up.

''I believe that if the town doesn't stand behind its original non-negotiable offer, then we'll have serious credibility problems and a loss of leverage during the complex negotiations involving the lease agreements,'' he said.

Selectman endorsed the collaborative's latest offer, citing the need to move forward with a project supported by many residents.

But they also instructed Town Administrator John Kelly to research ways to possibly pay for an on-site project manager who can oversee the work with the town's interest in mind.

Jason Kolnos can be reached at jkolnos@capecodonline.com.