Wind Energy Leases
Kansas Wind & Renewable Energy Conference
September 24, 2008
Mark Lawlor
Horizon Wind Energy
Who We Are
• Horizon Wind Energy develops, constructs, owns and operates wind farms throughout the U.S.
• Originally Zilkha Renewable Energy. Acquired by Goldman Sachs in 2005 and renamed Horizon Wind Energy. Acquired by Energias de Portugal (EDP) in 2007.
• Headquartered in Houston with regional offices in New York, Oregon, California, Oklahoma, Colorado, Minnesota and Illinois
• Over 200 employees
• Have developed more than 2000 MW of operating wind farms, and own over 1300MW
What We’ve Done
Tierras Morenas24 MW, Costa Rica
Blue Canyon Wind Farm225 MW, near Lawton OK
Top of Iowa Wind Farm
80 MW, Worth County Iowa
Maple Ridge Wind Farm
322 MW, Lewis County NY
Lone Star400 MW, Shackelford
County TX
Twin Groves396 MW, McLean
County IL
Elkhorn Valley100 MW, Union County
WA
Prairie Star100 MW, Mower
County MN
The Wind Energy Lease
Common Elements
Easements• Easements (run with the land)
– Capture wind– Access: roads, crane travel path, distribution– Construction
The Wind Energy Lease
Term:• Option/Development Term
– Allows developer to conduct due diligence
• Extended/Operational Term– Driven by PPA, market, economics,
transmission
Rent:• Royalty on Gross Revenue• Nameplate Schedule
* A note on the Kansas Market
The Wind Energy Lease
Common Wind Company Covenants:• Keep roads in good repair• Keep land free of liens• Pay taxes• Keep project in state of good repair
Landowner Covenants: (based on landowners actual knowledge)
• Authority• Free of bankruptcy, pending litigation, judgments• Hazardous material• Unrecorded agreements• No interference• Hunting
The Wind Energy Lease
Assignment, Subleasing & Mortgaging:• Limited area of negotiation
– Wind company must be able to assign, sublease, grant a subeasement or license in or transfer any portion of the lease to third parties
Default & Remedies• Notice, cure, remedies under law
The Wind Energy Lease
Restoration/Decommissioning:• Turbines• Foundation• Restoration Fund
– Superseded by governmental permit fund– Fall back: scrap value
