Many States and Counties have a growing concern of what will happen at the end of the lifecycle of the rapidly increasing number of wind energy sites around the country. In addition several windfarms have been sold from the original owner and developers. Some states such as North Dakota have even enacted leglislation that require bonding with a written decommissioning plan updated yearly. Other states may require bonding at the county or local level.
It is also a good idea for lenders to consider the cost of decommissioning in the their performas. Legislators and County Officials are increasingly requiring bonds and more sophistacated plans to make sure they are covered financially for turbine removal. We can provide an independent third party estimate to help your finaicial models.
Most often developers hold the responsibilty to develop their own decommissioning plan. This may make sense since they will likely be the ones be responsible for doing the work when it comes time to decommission. However, they typically include “salvage value” for the turbines which means selling the wind turbine parts for spares or for reuse. In the event of default, the Local Government will then need to find a buyer and arrange transport, contractors, etc. The vast majority of windfarms decommissioned to date have been sold for scrap which has much lower return. In addition the fiberglass blades, nacelle and hub coverings currently require landfill disposal which has substantial cost. We can provide an independent 3rd party plan and estimate that will give you the proper surety that you need in the event of default.