Wind farm has local backers
3 towns, Peabody in on new facility
By John Laidler
Globe Correspondent / May 12, 2011
Four area municipal light departments are helping lead the way when it comes to harnessing the power of the wind in Massachusetts.
Last Thursday, Berkshire Wind Power Cooperative Corp., a group that includes the municipal utilities of Ipswich, Marblehead, Peabody, and Wakefield, dedicated a 10-turbine wind farm atop Brodie Mountain in the Western Massachusetts towns of Hancock and Lanesborough.
The 15-megawatt Berkshire Wind Power Project is being hailed as the largest wind farm in Massachusetts, with the capacity to provide electricity to 6,000 homes.
It also marks the first wind project jointly undertaken by municipal utilities.
Fourteen of them, including the four in this area, partnered with the Massachusetts Municipal Wholesale Electric Co. to form the cooperative, which built the $64.7 million wind farm and will own and operate it.
"We’re thrilled," said Robert Jolly, general manager of the Marblehead Municipal Light Department. "When 14 municipalities can get together and do something like that I think it’s very positive and a great thing."
The nonprofit Massachusetts Municipal Wholesale Electric Co., which provides energy, financial, risk management, and other services to Massachusetts municipal utilities, will manage the wind farm for the cooperative.
David Tuohey, a spokesman for the agency, said that the project "is not something that the municipal utilities were required to do," noting that, unlike investor-owned utilities, municipal operations are not mandated by the state to expand their use of renewable energy.
"They did it in response to the wishes of their customers, who encouraged them to invest in renewable energy," he said. "And the municipal utilities have done that in a manner that makes energy and economic sense for their customers."
Tuohey said it was originally anticipated that the wind farm would supply power at below-market prices. He said that is no longer the case, because market prices have fallen over the last several years due to the significant drop in the cost of natural gas.
The project ended up costing about $10 million more than expected due to a lawsuit brought against it by a neighboring landowner. The suit, settled last fall, also added about a year to the project.
But even though it will not provide immediate savings, the project "adds a fixed-price, long-term energy resource to the power supply of these municipal utilities and it minimizes their reliance on fossil-fuel generation and the related price spikes," Tuohey said, noting that in the event of such spikes, the wind farm could generate savings.
He said that although wind power for now is above market rates, the investments made by the municipal utilities are at a small enough level that they should not have a significant impact on customer rates.
In 2005, MMWEC entered into an agreement with the then developer of the wind farm, Berkshire Wind Power LLC, to buy all the power from the future facility, and contracted with the 14 utilities to supply it to them.
Two years later, MMWEC learned of an opportunity to purchase the project assets, spurring the nonprofit to join with the 14 municipal utilities to create the cooperative.
Once it purchased the assets in 2008, the cooperative took over development of the project, which at the time was mostly permitted but had seen only preliminary construction. The work was recently completed.
MMWEC financed the project with bonds whose debt the participating municipal utilities will repay based on their share of the project and its future power output.
Peabody is the largest investor in the project, with an 18.2 percent share. Wakefield’s share is 9.1 percent, Marblehead’s 6.7 percent, and Ipswich’s, 6.4 percent.
The power produced will be supplied to the regional power grid, with each municipal utility earning energy credits based on their share of the project.
"I think it’s a great achievement that we got it done. It took a lot of persistence and hard work," said William F. Waters, general manager of the Peabody Municipal Light Department.
While the project is not as financially attractive as it seemed several years ago, “it provides clean, renewable energy, it adds to our power supply portfolio, and it benefits the environment,’’ Waters said. "It’s… great to be in the forefront of wind energy production in the state."
Peter Dion, general manager of the Wakefield Municipal Gas & Light Department, said the project was "a little more expensive than it set out to be. But overall, its a good mix for our portfolio," referring to the addition of wind power.
Jolly said that even if Marblehead reaps no immediate savings, investing in the project is "the right thing to do. It adds another piece of renewables to our portfolio" and reduces the town’s carbon footprint, he said.
"I think it’s a good project," Tim Henry, director of utilities for Ipswich, said of the wind farm, observing that atop Brodie Mountain, "the wind resources are excellent."
Henry said the project — and a separate, nearly complete town project to locate a wind turbine at the end of Town Farm Road — will follow a goal set by the town’s electric light commissioners to work toward "greening our energy portfolio."