Falmouth’s Taxpayers asked to reach into their pockets again
W. C. Fields famously quipped, “If at first you don’t succeed, try, try again. Then quit. There’s no point in being a damn fool about it.”
Yesterday’s Falmouth Enterprise reported the Finance Committee is recommending $35,482 for the renewable energy line item in the town’s Fiscal Year 2022 budget. This amount covers preventative maintenance of the turbines “so they remain functional for a buyer,” explained Committee member James B. Newman.
According to the Cape Cod Times, as far back as April 2019 the town requested letters of interest from organizations interested in operating the wind turbines, but there have been few responses.
Prospective buyers understand wind turbines are designed for operation. Long periods of inactivity erode the useful life of the turbines even with preventative maintenance. Prospective buyers know the turbines are 2004-2005 vintage. They know the turbines were operated approximately seven years, with extended shut-down periods. They know the turbines have been practically idle since 2017. As these old, used turbines continue sitting dormant, is it reasonable to believe a buyer will be found?
Driving the hope for a buyer
Wind 2 was funded through an ARRA grant. Because of its non-operation as a renewable energy system, the grant requires repayment ($3.5M). The select board’s effort is seemingly based on a presumption that the turbines can be sold and will be operated in another community. The primary mission – to avoid a $3.5M repayment for Wind 2.
Wind 1 is a separate cost issue over which selectmen have no control. Taxpayers are stuck with the cost of bond obligations for approximately 10 more years.
Essentially, an effort to save the town $3.5M will cost taxpayers $35,482 this coming budget year. Mind you, since the turbines were permanently shut off (2015 & 2017), similar sums for preventive maintenance and care have been appropriated in the annual budget by town meeting (totaling approximately $200,000).
The resale value of the turbines to a third party is estimated for planning level budgeting purposes to be approximately $300,000 each for a total of $600,000 according to the town’s consultant.
Relocating each wind turbine to an alternate location would cost approximately $2.0 million per turbine or $4.0 million dollars. This is based on the cost for dismantling, installation of new foundations, and reassembly and commissioning at the alternate location.
Realize these are 2011 values based on Westin Sampson – Wind Energy Facility Mitigation Alternatives Analysis – Dec 2011. It’s nearly certain resale value has declined and relocation costs have risen.
Given the lack of buyer interest, the forgiveness uncertainty of all or any portion of the ARRA grant and the relatively miniscule revenue return for resale/relocation, taxpayers are once again being asked to pay $35,482 for a seemingly unsustainable hope.
Maintenance expense break-point
The salvage value for the steel and copper of the turbines is estimated at $102,000. Miscellaneous components for spare parts is valued at $80,000, for a total estimated salvage value of $182,000 (Westin Sampson – Wind Energy Facility Mitigation Alternatives Analysis – Dec 2011). For argument sake, rounding up and agreeing 10 years has made the salvage value $200,000.
Falmouth taxpayers, without any buyer certainty and continued state obstruction in grant forgiveness, are now being asked to allocate more money to long term preventive maintenance and care than the estimated salvage value worth of the turbines.
Sustaining a town fund net drain
What will it take… to be done? At what point do we say