wind turbine project

Issue: We negotiated a contract with a developer for the output of a large on-shore wind project. The price of the energy and capacity was very low, optimal for our clients, but perhaps too good to be true. The developer attempted to use the contract to finance the project. When he had little luck, he asked our clients to agree to price increases.  At the third request, our clients determined at that price they should own the project. So the issue became: How can we help multiple noncontiguous entities achieve their objective of owning, financing and operating a wind project that was remote from them?

This was an incredibly unique undertaking, never done in this state before. This was to become, at the time, the largest on-shore wind development in Massachusetts. Carefully, and working very closely with management and directors, Ferriter Scobbo laid out a course of action in a step-by-step plan for getting the turbines up and operating: it entailed everything from the creation of a special purpose corporation taking advantage of multiple statutory benefits and multiple financings including taxable and tax-exempt debt, land-use zoning and project siting, eminent domain land taking, easements, litigation and environmental permitting. The project spurred the creation of multiple contracts including: asset purchase agreement, turbine purchase, public relations, EPC/construction, site security, as well as contracts for the purchase and the sale of electric energy and capacity, transmission interconnection agreement, and more.  We communicated to the client what we knew had to happen, our anticipated timeframe, and costs, for carrying each step out.

In purchasing the permits and easements assets, from the original developer, we were aware that one liability the client would be taking on was a piece of litigation. We advised that this liability was worth the risk, and we incorporated that litigation into our step-by-step plan.  We gave our best estimates on what may lead the litigation to stray from the straight and narrow.  But as is sometimes the case with litigation, it was impossible to anticipate every hiccup in the proceedings. At one point, the litigation resulted in a halt to the construction which meant finding a storage area for the turbines, other equipment and de-mobilizing the construction, all unanticipated by us and the client. We had to re-address and re-chart the path.   Eventually, we came to a settlement that cost our clients a little more than the cost estimate at the start of the construction.  Despite the monetary setback, there were other areas of the litigation and settlement that were successful, such as a taking, by eminent domain, and purchasing a parcel of land with easements.

For every obstacle, our attorneys evaluated the step-by-step plan and made any and all necessary adjustments. Communications with the client was virtually daily. Our advice to the clients included drafting and executing the documentation for 2 asset purchase loans and a letter of credit. We negotiated a taxable term loan for construction purposes and ultimately a tax exempt bond issue to repay the construction loan. The project also entailed obtaining a private letter ruling on tax exempt financing and termination of various multi state contracts, without litigation.

A matter that started as a Boardroom contract matter morphed into a larger project that entailed not only additional Boardroom advice, but also applying that knowledge in the Courtroom, as well as in Federal, State and Local agencies. Each new curve in the multi-year course to project completion required conferencing and communicating with the client. Late night strategizing phone calls with the client were not unusual. We continually counseled the clients on maintaining their objective and the recommended steps to its achievement. The turbines are up and running, producing output beyond client expectations.