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Trust, Teamwork Keys to Gratiot’s Windpower Success

County’s approach offers lessons for other farm communities

Power to Change | August 14, 2012 | By Jim Dulzo

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Gratiot County’s new wind farm is an economic boon to its farming community and continues to enjoy strong local support. (Photo courtesy of Michigan Energy Michigan Jobs)

Part 1 of a two-part series. Read Part 2 here

BRECKENRIDGE, Mich.—Two months after Michigan’s largest wind farm kicked into high gear, local support remains strong for the 133-turbine, 212-megawatt Gratiot County Wind Project, which literally surrounds this small, mid-Michigan farming town.

The project spreads across four townships and 30,000 acres of tabletop-flat farmland in Gratiot’s windy northeast corner. A drive along the area’s main highway, M-46, reveals that the turbines have dramatically changed this farming community’s landscape: The big machines seem to be everywhere.

But local business people say that while they hear some complaints from their customers about the nearly 500-foot-tall machines, most seem glad to see them in place. They like the local wealth and clean energy it generates on breezy days. Local officials say they largely hear the same thing.

This November, if Michigan voters approve the popular “25 x 25” clean energy ballot initiative,  which requires 25 percent renewable energy by 2025, other windy farm communities could be vying for their own utility-scale windpower development.

Gratiot’s successful experience offers those areas a textbook case on how to attract wind development, and then build community support for it.

Interviews with local officials like Don Schurr, director of Greater Gratiot Development Inc., the county’s economic development agency, and Richard Vander Veen, the windpower developer, indicate that winning community-wide acceptance requires more than waving generous royalty leases at an area’s largest property owners.

According to both Mr. Schurr and Mr. Vander Veen, it is crucial to build trust throughout the community well before lease-signing begins.

They also point out that Gratiot had a big advantage: countywide cooperation on economic and planning issues via a countywide master plan and economic development strategy.

That kind of cooperation quickly allowed Gratiot and its 16 townships to implement Michigan’s first county wind farm ordinance; each township board approved it by unanimous vote. Mr. Schurr and Mr. Vander Veen say that made Gratiot more attractive to developers by eliminating the welter of differing township rules that make such projects more risky and expensive.

The formula is working: Chicago-based Exelon Corporation is now constructing its 34-turbine Beebe Community Wind Farm just south of here, scheduled to go online by the end of the year. Other projects are in the works, but likely will not move forward, according to Mr. Schurr, until the companies can sign power purchase agreements with utility companies.

Approval of the 25 x 25 renewables initiative would help with that, clean energy advocates point out. Michigan now has 15 wind farms either operating or in development. Together, on a windy day, they could generate slightly more than 1,082 MW of clean power—the output of one very large coal plant.

Who Do You Trust?

According to Mr. Vander Veen, getting Gratiot’s residents to trust his company, Wind Resource LLC, required a slow, yet simple process: talking to lots of people. He often jokes that it took “about 50 cups of coffee per megawatt” as he chatted in kitchens and local restaurants with people who wanted to know more about his proposal.

“We worked with some of the largest families in the community who then put us in touch with their own, personal networks, and those people then did the same thing,” he explained. “So, you end up respecting everybody.”

The developer then attended community meetings where people were encouraged to ask questions, raise objections, and learn as much as possible. They included sessions with Future Farmers of America members; educators; local, state and federal officials; MSU Cooperative Extension staff; and Michigan Farm Bureau members and officials.

“We did a listening tour, finding out what peoples’ values are,” he said. “It’s important to remember that we are invited guests, and we can’t impose anything.

“That is why we chose the co-operative, community participation model,” he added, referring to both the open-ended way he communicated and the leasing arrangement he offered. Everyone who signed up received payment, whether or not a turbine landed on their property.

“As I said in my TEDx talk in Marquette, we were trying to contrast our approach with that of a utility trying to impose, say, a Texas approach,” he explained, “where it’s just a few very large landowners, instead of a lot of small ones, like in Michigan. If you start by deciding what you’re going to do and then just defending it, it doesn’t get you very far.”

Or, as he told Midwest Energy News recently, “We know that you don’t just get consensus; you have to earn it.”

Let’s Get Together

When Mr. Vander Veen began approaching people in Gratiot County, he already had a powerful ally: strong collaboration among Gratiot County and its townships, even when a project helped just one local government.

It was always clear, for example, that the wind farm’s property tax payments would not benefit any of Gratiot’s towns since the machines would be outside their borders. But that didn’t stop Breckenridge Village Manager Jeff Ostrander from supporting the project, as he explained on a local website

“Our community doesn’t get any of the tax revenue, but it’s so important because we see the bigger picture,” he said. “Outside of Breckenridge, when you start going into the other towns--Ithaca, Alma, St. Louis—all those community leaders are gaining nothing from this project, either. But they see the bigger picture, too.”

That bigger picture emerged in the late 1970s, according to Mr. Schurr, when the county formed Greater Gratiot Development to counter several hard blows to the local economy, including the demise of major local employer Michigan Chemical due to PBB-livestock feed poisoning, and the closure of several auto parts factories due to the Arab oil embargos.

“We had a 21 percent unemployment rate,” Mr. Schurr recalled. “The community decided, ‘This isn’t working. So we are going to get together, toss away our parochialism, and form an organization dedicated to the county’s economic development.’ It has continued to evolve from that over the years.”

Today the county has a single economic development agency, brownfield authority, and hospital authority, and a unified approach to other agencies and services, too.

“This kind of understanding—that we work together as a larger market for the benefit of the wider community—has moved from being an unusual to an expected occurrence in Gratiot,” he said.

Gratiot established one of the state’s first countywide strategic plans in the early 1990s, followed by a countywide master plan. And when officials learned that wind companies were checking out Gratiot, they took a logical step—inviting residents to help them formulate countywide windpower zoning.

“We got together anybody who wanted to participate, and did a lot of research,” Mr. Schurr said. “MSU was very helpful. We had packed community forums, and we came up with a model wind ordinance.”

Big Benefits

Many of the financial benefits that the new wind farm is providing to local governments and schools are easy to tabulate.

The owners of the $440 million wind farm—DTE Energy and Invenergy—will jointly pay about $50 million in taxes to local schools, townships, and the county over the next 20 years. According to Mr. Vander Veen, that’s more than the total now paid by the county’s top 10 taxpayers.

That represents a significant tax revenue boost. For example, The Saginaw News reports that the $60,000 in new revenue that rural Bethany Township will collect every year represents about a quarter of its annual budget. The money could help improve roads or lower the township’s current one-mill property tax.

Breckenridge Community Schools also benefits. It expects about $5 million in wind tax money over the next 20 years, allowing the school system to upgrade its badly worn electrical, lighting, heating, and plumbing systems.

Audrey Westall, owner of the Hair Parlor, in Breckenridge, is happy about the help for the school, without which it “would probably be folding up in two years,” she said. “We are very fortunate to have the wind farm here.”

But the project helps in other ways—starting with keeping local restaurants busy during construction. The turbines now require 15 technicians to keep them spinning.

Mr. Vander Veen calls the other big benefit of his project “Wealth from the Wind.” More than 250 families who signed the project’s unique pooling easement agreement will, among them, receive an estimated $2 million per year in royalty payments. The developer said that everyone living within the 35,000-acre project area was invited to sign a lease. Farmers received a $1,000 bonus payment when they signed, with or without turbines on their property. Those who ended up with turbines on their property do receive an additional sum, but it was kept small, he said, in order to keep the general “pool” payments as large as possible. All told, the project removed only about 300 acres from active farming.

“It’s roughly equivalent to having an industrial development with 50 good-paying jobs,” Mr. Schurr said. “And that money will be spent, not invested—on a new tractor, a new barn, a new pickup, an addition to the house, going to dinner more often. It’s really a continuous shot into the local economy.”

He added that the turbines helped build the county’s new industrial park, just outside of Breckenridge. One building hosts a new turbine maintenance facility. 

And, to deliver the turbines’ 212 MW of electricity, the grid transmission company ITC spent $30 million on electrical substations.

“That’s all taxable property,” Mr. Schurr said, “and it will also make us very reliable electrically. Maybe we can attract some other kinds of businesses because of our improved energy infrastructure.”

County commission chair Jeff Anderson said that Gratiot’s turbines are attracting more people to the community.

“People come in here to take a look at the turbines, and then they do some shopping,” he said. “That was part of our overall design, of better promoting the area.”

The new tax receipts are also financing water and sewer expansion, so when outside businesses are interested in the area, the county is ready.

“In a buyers’ market, you can’t say ‘in six months we’ll have water and sewer,’” he pointed out. “Now, wherever those new companies go—St. Louis, Breckenridge, Alma—we will all be happy, because we will all benefit.”

And while the turbines may be helping Gratiot grow in new or unexpected ways, Mr. Schurr notes that they are also making sure that the county’s most crucial feature remains untouched.

“Everybody here puts a high value on the preservation of land,” he said. “You put in a wind farm, all you do is farm. So all of the municipal people see the wind farm as an accomplishment that fits with the countywide master plan that everybody supported.”

Jim Dulzo is the Michigan Land Use Institute’s senior clean energy policy specialist. Reach him at jimdulzo@mlui.org

11 Comments

1572 days ago, 12:36pm | by Clover Roy | Report Comment

“It’s roughly equivalent to having an industrial development with 50 good-paying jobs,” Mr. Schurr said. “And that money will be spent, not invested—on a new tractor, a new barn, a new pickup, an addition to the house, going to dinner more often. It’s really a continuous shot into the local economy.”

This means green energy, and economic development all at once. Sounds like a no-brainer to me!

1572 days ago, 2:24pm | by Kevon Martis | Report Comment

The energy produced from the Gratiot turbines could be produced from a single flatbed trailer mounted gas turbine that fits nicely inside an existing dairy barn. This would yield a nearly 60% reduction in greenhouse gases compared to coal at a far lower price than this turbine project and we could use almost exclusively indigenous gas from the Antrim shale to produce it thereby ending importation of Wyoming coal. Talk abot jobs creation! A Combine Cycle Gas Turbine could produce far more power than Gratiot at a very low price and it could be placed on an urban brownfield without a 143 mile long half-billion dollar Thumb Loop Transmission line. How many acres of ag land are surrendered to just that line?

As a matter of land use policy, low energy density sources like wind and solar are an abominations. If 25x25 passes, we will need minimally 3000 new turbines and more likely 4000. Using 2 acres per turbine lost, that is 6000+ acres just in access roads and turbine bases. This does not count loss to substations and loss-of-yield impacts at concrete batch plant parcels. Neither does it account for future loss of yield from the turbine impact zone in the event of decommissioning of the turbines. That soil will never produce like it once did, assuming the local jurisdiction bothered to enact a decommissioning bond to guarantee removal of turbines and access roads at the end of the project.

This article is nothing more than wind turbine apologetics where one assumes that wind is good and then attempts to create a pro-wind systematic theology in attempt to explain away the obvious contradictions between good land stewardship and low density land use applications like industrial wind. Until wind and solar are attached to cheap and compact storage, which does not exist, wind turbines are nothing more than faith-based energy masquerading as a meaningful energy source.

MLUI should be ashamed.

Kevon Martis
Director
www.iiccusa.org

1572 days ago, 3:06pm | by Richard Kooyman | Report Comment

I second Mr. Martis's viewpoint. It has always perplexed me how fast the MLUI adopted the attitude that the past corporate utility culture is bad (which they may in fact be) and this new corporate wind culture is good and benevolent.
Questions regarding feasibility, sustainability, functionality, and a unified state wide plan still abound before this new land grab should be so eagerly promoted. The 25% mandate is not a citizen driven ballot initiative. It's a wind industry driven one. This article makes it sound like the developer is doing it for the benefit of the community.

1571 days ago, 2:18pm | by Jim Dulzo | Report Comment

Kevon, you’re right: Run an 80 MW gas turbine generator (which might almost fit on a big flatbed) for a year and it will generate as many total electrons as the Gratiot Wind Farm would in the same time. That’s because of one of your favorite wind “drawbacks”—it’s intermittency—allows your truckable, always-on turbine to “catch up” with wind power’s electron totals in between breezes.

So, your truckable tale is just a more colorful way of stating that old canard: Wind power is useless because it’s not base load power. But wind and solar don’t have to wait for fancy storage—which lots of motivated engineers are working furious to perfect, of course—for two reasons.

First, the gas turbines you admire are perfect complements for wind farms. Unlike coal, they power up quickly to fill in when the wind fades, and power down quickly, too, when that free fuel returns. For Gratiot, you’d need a much, much larger turbine to substitute for the 212 MW the wind farm was making. You could put it and its really big barn—actually, a power plant—next to Gratiot’s substation and get base-load by running gas about 65 percent of the time, and wind the rest of the time. That would cut base load carbon emissions by about 35 percent compared to all gas.

BTW, greenhouse gas cuts from gas versus coal are closer to 40 percent. It’s a big improvement, but gas-fired plants still emits plenty of greenhouse gas and other pollutants, so your truckable turbine doesn’t completely solve the problem.

Secondly, wind always blows somewhere. As more wind farms help out more farm communities, a revitalized grid (necessary with or without renewables) will supply ever-more wind power that’s base load. Standford researchers reviewed real-world wind and power data from 19 wind farms and found 33 to 40 percent of their collective production amounted to base load. They also found that the more wind farms, the more “basey” their output gets, and that just 10 non-adjacent farms can trigger the phenomenon.

Cost? Right now gas-fired electricity is still a bit cheaper than wind power, by about a cent or cent and a-half per kWh. Thanks to fracking, gas was at a historically low price for awhile, but that’s already going back up. Meanwhile, wind costs continue to fall—and the fuel is always free.

Abomination, eh? Now there’s a five-dollar word! So … what word do you then use for mountaintop removal, aquifer poisoning, heavy freshwater consumption; breathing bad air; living near fossil-fuel-burning power plants, heating lakes to cool power plants, miners buried alive, drillers blown up, mercury poisoning, increasing asthmatic and pulmonary distress, flaming kitchen faucets, methane’s stink, plant explosions, buried creeks, abandoned communities, reactor meltdowns, greenhouse gas emissions, and climate change?

Solar and wind power are the only significant power sources I know of that deal with every last thing on that list. If there’s an abomination, it’s the U.S. dragging heels on using clean renewables to solve those … er, I’ll just call ‘em “problems.” About 20 to 25 installations like Gratiot’s would meet the 25 percent thang…and likely fewer, as wind technology gets more efficient, productive, and continuous, and solar starts to really grow, too.

As far as land lost: Farmers plant right up to the towers, their cows are fine, and there’s no land shortage. Should farmers be compensated for the land those towers take out of production? Sure. And they are. Gratiot’s 30,000-acre farm took about 300 acres out of production, by the way.

Land stewardship? Turbines do not damage farmland. They protect it from suburbanization, and poor soil can always be amended with compost.

Faith-based energy? Tell that to Iowa, North Dakota, Colorado, California, Denmark, England, and other places using lots of faith-based energy by getting at least 10 percent, and sometimes more than twice that, from wind. Attacking wind power makes no sense: It’s attacking a larger system in its infancy for not being able to walk yet. When it’s grown up, that system will have a renovated power grid combining energy efficiency, cleaner coal, natural gas, nukes, wind, solar, and geothermal into a power supply that gradually, as technology improves and fossil-fueled plants close down, no longer emits, as it does today, about 40 percent of America’s greenhouse gas emissions.

No shame there!

And, to Mr. Kooyman: Why not judge companies by what they do, not their “culture”? If, say, Duke puts up wind turbines to diversify its portfolio away from coal to help keep the profits coming, why discourage them? Can companies, like people, do both bad and good? I hope you will visit some West Virginia coalfields, paint them, and see what your patrons think. If they had to choose between one of your landscapes with a turbine and one with mountain top removal, which would they choose? Finally, I’m working on 25 x 25, so I know a lot of citizens are involved—people who want to do something about the pickle the planet is now in instead of attacking whatever those nasty corporation advance as real solutions. Whenever people or companies can make money themselves while helping others--or the environment--how could that possiby be a bad thing?

1571 days ago, 2:42am | by Dark Money NIMBY's | Report Comment

Conservative thinktanks step up attacks against Obama's clean energy strategy
http://www.guardian.co.uk/environment/2012/may/08/conservative-thinktanks-obama-energy-plans

1571 days ago, 8:29am | by Richard Kooyman | Report Comment

JIm Dulzo,
I've never been a defender of the fossil fuel industry and I see them as destructive and a corporate culture whose sole focus is investor payback. You and I might agree on that. But why does the corporate wind industry get a pass from the MLUI?
Does the MLUI think that Marty Lagina, the founder of Terra Energy, is a benevolent business leader and steward of the environment? Has his motives and his business demeanor automatically changed in your eyes as CEO of Heritage Wind Development?

Your reporting for the MLUI on industrial wind generation has never given time or space to the questioning of who this new corporate wind culture is, what there plan is, how the developers plans tie into the states plan or lack of plan. Instead you label anyone with the least mistrust of who is flooding to our state to erect 500 foot wind turbines as "anti-wind" opponents. Anyone who has the least amount of skepticism and is seeking to find answers to the questions regarding total number of turbines, viewscapes, noise, electric grid feasibility, etc gets labeled by you as "attacking a larger system in it's infancy." Isn't that the very time any responsible person should be asking questions?

Of course no one wants the continuation of mountain top mining or the pollution and health effects of our continued use of fossil fuels but that doesn't mean I should automatically believe the wind corporations are in the business of "helping others."

The late great Utah Phillips often spoke and sang about the insanity of taking our public resources and having corporations sell it back to us for, as he said, a "greasy buck." Certainly there are people at the MLUI that use to listen to Utah?

1570 days ago, 4:00pm | by Force vs Consent | Report Comment

Jim,

I’m confused are you a reporter, and editorialist or an activist?

You are missing the point about natural gas which is that for much lower cost we can switch from coal to gas and have a much bigger impact on pollution and GHGs. Forcing the addition of wind only reduces the resources and money we have available to fight the problem. The biggest impediment to reducing GHGs in this country is slow economic growth and enormous debt. When we continue to waste money on ineffective technologies like wind it only makes matters worse especially when you consider we are borrowing this money from China.

According to the EIA GHGs from gas is 50% of coal. You are correct when you say that gas doesn’t completely solve the problem but it is capable of solving a bigger portion of the problem than wind. When you add wind at 25% you are only reducing GHGs by 10-15% and you are doing so at a very high cost per ton of CO2.

We’ve all heard the claim over and over again by the wind industry that the wind is always blowing somewhere. Unfortunately this claim is not supported by the facts. Please look at appendix F of this report from MISO. It clearly shows that during periods of peak demand wind output varies wildly from 1.5% to 56% of nameplate. If wind over large areas truly balanced itself you would expect this percentage to consistently hover near 30%. Keep in mind that this is a total of all wind production from Manitoba to Kentucky. Wind is not baseload, is not dispatchable and provides no real capacity. https://www.misoenergy.org/Library/Repository/Study/LOLE/2012 LOLE Study Report.pdf

Your suggestion that wind is cost competitive with gas is highly flawed because it fails to include the cost of subsidies, the cost of transmission, the cost of integration and the cost of the lost efficiency it causes at fossil plants. The biggest flaw however is that you really cannot compare wind to gas or coal because wind provides no real capacity. We still must operate and maintain all of our fossil fuel plants. Other than a slight reduction in fuel costs wind only adds to our total cost of power.

With regard to your list headed by the word abomination I think you are wrong on almost every count. Most of your list assumes that wind will reduce coal consumption. The research I’ve done indicates that wind will reduce gas consumption but will have very little impact on coal. Take a look at the data from Iowa and Texas and you will see no decrease in coal consumption despite massive wind buildup.

The wind industry likes to claim that it has gotten more efficient but what has really happened is turbines have gotten taller and bigger. There have been no major breakthroughs in technology unless you consider 500ft turbines a breakthrough. In fact the next step is 600 footers.

Wind is not in its infancy it is a mature business operated by billion dollar companies that have excess capacity. Contrary to the claims of the wind industry overall employment in the state will go down as a result of 25x25. You cannot create jobs by taking money out of one person’s pocket and giving it to another. Sure the farmer likes the income but where is that money coming from? It’s coming from taxpayers and rate payers who will now have less money to spend in their own communities.

Iowa and North Dakota like wind because it is just another subsidy for farmers, wind is helping California go broke and the cost of power in Denmark and England is 4 times higher than Michigan. Are these the best examples you could think of?

1570 days ago, 4:51pm | by Olivia C. | Report Comment

I visited Gratiot County to see the wind farm and enjoyed it.

As someone who participates in township government in a different rural county, I was very surprised to learn everyone in Gratiot was able to come to an agreement on a county master plan. Local politics can be very... turbulent (laughs). The GREAT Plan is definitely something to be proud of.

1569 days ago, 10:00pm | by Anti-anti nuke NIMBY's | Report Comment

http://www.treehugger.com/environmental-policy/when-anti-clean-energy-conspiracy-isnt.html

1569 days ago, 10:10pm | by Kevon Martis | Report Comment

Wind is nowhere near the same cost as gas. Using EIA data on the cost of erection of turbines, assume 10% cost of capital, factor in industry standard 20 year lifetime and a 25% measured capacity factor and the true cost of wind production in MI is at least $120.00 per Mwh, or nearly 3 times the on-peak wholesale price of power on the grid according to MISO. The only way wind appears cheaper is by leaving the massive subsidy support off the cost side of the ledger. But there is no way the real cost can ever be less than capital cost+interest per usable lifetime/annual production. Unless you do some of the crazy Shauer/Sarver/Baldwin wind-math voodoo and pretend the subsidies don't count as a real cost of wind because you pay them on April 15th rather than every month.

"Zooming out for all energy, the Congressional Research Service did its own analysis of tax incentives last year. It found that in 2009 fossil fuels accounted for 78% of U.S. energy production but received only 12.6% of tax incentives. Renewables accounted for 11% of energy production but received 77% of the tax subsidies—and that understates the figure because it leaves out direct spending."

http://online.wsj.com/article/SB10001424053111903285704576559103573673300.html?mod=googlenews_wsj

1568 days ago, 5:50pm | by Kevon Martis | Report Comment

Mr. Dulzo:

You have answered your own question regarding the TRUE cost of wind: "You could put it and its really big barn—actually, a power plant—next to Gratiot’s substation and get base-load by running gas about 65 percent of the time, and wind the rest of the time. "

According to your own formula, the, the true cost of wind is 1MW wind + 1.8 MW Gas. (35%/65%) Thank you for the candor. This means wind will NEVER equal the cost of gas. It can never be less than the cost of wind plus 1.8 times the cost of gas. You recognize what MiEnergyMiJobs refuses to recognize: there is no such thing as wind alone, only fossil/wind. This means gas will ALWAYS be significantly cheaper than wind because wind cannot escape fossil's grasp no matter how you torture your logic.

Now why not be candid regarding land use? The reason wind turbines stop farm land conversion is because no one in their right mind would chose to build a home next to one, not matter how many NREL studies you trot out to the contrary? You have discovered an immutable truth: industrialize ag land with ANY industry and you will reduce residential development. Of course not a single acre of farm ground gets converted to non-ag use unless a farmer sells it off. So in the end, ag preservation policies essentially are designed to protect ag ground from FARMERS.

Kevon Martis
former vice-chairman
Lenawee County Rural Land Use Committee

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