This article comes from the Energy Law Update and the Energy Group at Verrill Dana LLP, It is authored by Juliet Browne.
After more than a year of pre-rulemaking process including the issuance of two drafts, the Maine DEP has commenced formal rulemaking and has issued draft rules for wind energy developments in Maine. The formal draft largely tracks the most recent pre-rulemaking version issued in January 2017. The draft rules include standards for evaluating scenic impacts, limits on shadow flicker, provisions related to public safety, and requirements for demonstrating significant tangible benefits.
In many respects, the draft rules codify existing DEP practice. There are several significant departures, however, from current practice.
- The new provisions on decommissioning do not allow consideration of salvage value when estimating costs and establishing the required decommissioning fund. The decommissioning fund must be fully funded and in place prior t the commencement of construction and must be re-evaluated every two years during the life of the project. This change would substantially increase the costs associated with the required decommissioning fund.
- The applicant is required to provide evidence of a power purchase agreement or other evidence demonstrating the intended sale of the project’s output to a third party. The DEP has not previously required evidence of a power purchase agreement and does not generally evaluate the economics of projects it reviews or require a showing that the output (whether an energy project or non-energy development) will be sold to a third party.
- The applicant must provide evidence of the project’s effect on electrical rates directly attributable to the project. The impact of any single generation source on electrical rates in Maine is a complex undertaking that requires sophisticated modeling and assumptions about future operation of the electrical grid, future energy mix and prices in the region, and a myriad of other factors. Importantly, in enacting the Wind Energy Act the Legislature made specific findings on the positive effect of wind power on electrical rates and recognized that the environmental review agencies did not have the expertise to evaluate the impact of new generation on electrical rates. As a result, there are no statutory standards related to evaluating the impact of a project on electrical rates.
- The safety setbacks from property lines have been increased from the existing standard of 1 ½ times the distance to the tip of the fully extended blade, to 1 ½ times the hub height plus rotor diameter.
The DEP is holding a public hearing on the draft rule on December 6 at 1:00 PM in Augusta, and is accepting public comment on the draft rule through December 18, 2017.
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