Mighty Wind on Vinalhaven

Vinalhaven had not seen the likes of it since the massive columns for New York’s St. John the Divine rumbled across the island more than a century ago. Four huge blades — the business end of a trio of wind turbines that have since risen above the island — arrived in Carver’s Harbor. And a crowd of two hundred residents and vacationers gave them a hero’s welcome.

For the barge carrying its 123-foot-long cargo, the voyage from Rockland needed to be planned like a military exercise. Lobstermen had to remove their traps from its path. Many of the two hundred boats in the harbor were temporarily displaced from their moorings. And still the crowd was cheering.

Up close, a wind turbine is of mind-boggling size, and in the course of the next couple of weeks, the process was repeated as more parts were unloaded, then transported the five or so miles to the building site. One heavily laden flatbed truck got stuck navigating a bend, blocking the North Haven road for hours. But no traffic jam developed. North-bound drivers on one side simply exchanged cars with the south-bound drivers on the other, and they all proceeded on their way.

No wonder, then, that everyone involved in Fox Islands Wind (FIW) credits so much of its success to the people of Vinalhaven. Elsewhere in Maine, communities have turned down wind-power developments or have been left unhappy in their wake. That’s because towns absorb the environmental, social, and infrastructure costs in exchange for additional  property taxes, and the developer reaps the financial benefits. People tend to see it as “making a deal with the Devil,” says Island Institute President Philip Conkling, one of the instigators of Fox Islands Wind.

Why has the experience on Vinalhaven been so different? Says Fox Islands Wind Director George Baker, succinctly and without hesitation: “Community ownership, community control, and community benefit.”
 
Baker, a Harvard Business School professor and summer resident of Frenchboro, was planning a year’s sabbatical just as Maine’s island communities were seeing their electric bills going through the roof. In 2006, rates on Vinalhaven were nearly thirty-two cents per kilowatt-hour, up from the already above-state-average nineteen cents of previous years. For a year-round community of only 1,300, mostly dependent on fishing, it was a big chunk of residents’ monthly bills and more than twice what Central Maine Power’s mainland  customers were paying.

When Baker offered to spend a couple of months looking at the economics of wind power, he had no idea that “an academic exercise” would morph into a very exciting more-than-full-time job. Baker’s sabbatical, says Vinalhaven resident Bill Alcorn, turned out to be the key amid “a whole lot of serendipitous circumstances.”

Alcorn himself created some of them. He and another island resident, Del Webster, had been publicly exploring ways to lower electric rates. They purchased an abandoned quarry as a potential wind farm site, banking on the day when it might prove viable.

Teasing out any particular thread of events from a community’s warp and woof can be arbitrary. At its August 2002 meeting, under “new business,” the Vinalhaven Planning Commission took up the topic of “windmills.” That year, a test tower to measure wind speeds had been erected at the instigation of the Fox Islands Electric Cooperative (FIEC), which provides electricity to Vinalhaven and North Haven. General manager David Folce had ample reason to dream of the islands becoming Maine’s first green-powered community. The twenty-five-year-old submarine cable bringing Vinalhaven’s power from the mainland was on its last legs.

By 2005, the $6.8-million cost of a new cable, plus rising world energy prices, began driving the islands’ electric rates skywards. Three years-worth of data from the test tower, however, made Vinalhaven’s potential for wind power look promising, and the new cable would let the co-op sell any excess energy it generated back to the grid. But the island needed an exemption from Maine’s deregulation statute. State Representative Hannah Pingree, a North Haven resident, submitted a bill, and a sympathetic legislature passed it handily.

Pingree also suggested that the Island Institute convene a group of stakeholders from the electricity co-ops to explore future options. As treasurer of the Swan’s Island Electric Cooperative, Baker, the business school professor, was one of the stakeholders. After grappling with the problem through several meetings, he decided to get more deeply involved.

For a small island community developing its own wind-power project, Vinalhaven was “the obvious choice,” says Baker. Besides the wind studies, “the community was already discussing it.” The soaring electric rates had put FIEC under the public microscope. The co-op’s transmission and distribution costs, the bulk of each customer’s bill, are fixed, so when ratepayers started to conserve, the price per kilowatt-hour got higher still.

Back when the test tower first started generating data, the Planning Commission had foreseen the possible need to deal with wind-power development. With no relevant ordinances in place, debate over a proposed cell-phone tower a few years before had been “very messy,” says Commission Chair Gigi Baas. This time, the Commission wanted to get the issues on the table before specifics got decided or debated. From a series of community meetings, the message came loud and clear: We want wind power, but on our terms. “They did not want a big company calling the shots,” Baas declares.

The Commission passed the wind-power ordinance in March 2007. With administrative help from the Island Institute, Baker set to work the following July. Having concluded that wind power on Vinalhaven was economically feasible, he spent the next year developing an economic model for the project. When Fox Islands Wind, LLC, was set up as a subsidiary of the co-op, Baker, with a leave-of-absence from Harvard, became its CEO.

So how would the Fox Islands finance a $15 million project? Federal tax credits are available for wind power, but as non-profit-making entities, neither FIEC nor Fox Islands Wind could take advantage of them. “To monetize the credits,” says Baker the economist, “you need an investor with taxable profits.” (It’s called Tax Equity Investment.)

Enter the Hildreth family. Horace Hildreth is a longtime summer resident of Vinalhaven, a life-long conservationist, and, for many years, chair of the Island Institute’s board. He had followed Baker’s project from the beginning. Hildreth’s company, Diversified Communications, Inc., put in $5 million. With a good return on investment through tax credits over the next five years, it was a no-brainer for him. At the end of that time, Diversified will sell its ownership stake back to Fox Islands Wind.

A low interest loan from the USDA’s Rural Utilities Services covers the balance of the $15 million. Repaying it at a fixed 4 percent is what electricity production will cost for the next twenty years, the term of the loan. It will shave four cents per kilowatt-hour, or about 15 percent, off island electric rates; transmission and distribution costs remain as they have been. What makes rate-payers so enthusiastic about Fox Islands Wind is that it will stabilize their bills and insulate them from future spikes in energy prices. Self-sufficiency is always an island virtue. When it came to a vote by the co-op’s members, the result was 382 to 5, or 99 percent in favor.

As the reality of Maine’s first community wind-power project sank in, no one helped overcome the “gut fear” of change as much as Addison Ames. A lobsterman who has been on and off the co-op board over the years, Ames was “a one man PR machine,” indefatigable in talking up the project and making sure that the co-op responded to people’s concerns, according to Phil Conkling.

Still, not everyone was entirely happy. Noise — “ ‘a whooshing’ sound” and sometimes “a steady ‘hum’ or ‘whine’ ” according to Fox Islands Wind’s Web site — is a concern for a few neighbors. The subsidiary bought out three abutters at a fair price. It reflected an appropriate balance of individual cost and community benefit, says George Baker.

One minor glitch was the town ordinance. With few precedents to guide it, the Planning Commission had drawn from wind developments all over the country, most of which were commercial projects. Now they went back to the drawing board with revisions to allow for a community model.

The environmental impact of wind power has been a notoriously sticky issue in Maine, and the bar on Vinalhaven was higher than usual, says Richard Podolsky, a specialist in bird and wind-power conflicts who led the ecological review required by Maine’s DEP and the EPA. Islands are more ecologically sensitive, and, in this case, the project proponents were especially environmentally aware.

The big issues for development projects are wetlands and wildlife, especially birds and bats. Podolsky found no bats, and Alcorn and Webster’s old quarry offers little foraging habitat for songbirds. However, it is within range of half a dozen bald eagle territories. “Passage rate” — the key to predicting collisions — was low for most of the year, but rose during the eagles’ fall dispersion. Fortunately, the raptors mostly stayed by the water where they could hunt. Podolsky, who has a collision model before the U.S. Patent Office, had to convince both the U.S. Fish and Wildlife Service and the Maine Department of Inland Fisheries and Wildlife that based on his findings, eagles will not be a major issue for Fox Islands Wind. Nonetheless, he will continue to monitor them, and the local ordinance requires regular mortality surveys for a year after the turbines start up.

In May, the town approved the project. Cianbro, the general contractor, began clearing the site, and ground was broken at the end of June. Then the blades started arriving. By Labor Day, the first tower was going up.

Early one Monday morning in mid-September, a crewmember on the Vinalhaven ferry pointed to the white needle now visible well above the tree line. “Pretty, isn’t it,” she exclaimed to a couple of passengers on deck. “They’re putting the blades on today.” She pointed. “Look, you can just see the second tower.” Sure enough, a nub appeared and disappeared among the trees as the ferry chugged on to Rockland.

Fox Islands Wind is certainly visible. The towers are easily seen from the mainland. But, surprisingly, visibility hasn’t been an issue. A golfer looking up from the green at the Samoset told Hannah Pingree, “That’s so cool.” For island resident Gigi Baas, the view says one thing: “Aren’t those Vinalhaven people smart.”
 
(Photograph by ©IStockPhoto.com/wragg)