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If you own more than 20 acres of relatively flat and unobstructed land in the vicinity of Tehachapi-Willow Springs Road chances are you've been contacted by a wind energy company in the past six months.

With current government incentives to power companies, big wind is ramping up land leases and purchases for the next big boom in Tehachapi's wind industry. This is good for the local economy as it will provide jobs, and may be good for some landowners with otherwise "useless" land that has no water or power nearby.

In the past six months more than 45 leases to wind companies have been signed by local landowners (source: Kern County Recorders Office search). About 15 purchase agreements are also recorded.

I personally know of several landowners who have been approached by wind power companies to lease their land. While some of the initial offers seem quite lucrative and landowners may be ready to jump in rather than lose the opportunity, there are several factors land owners should consider when reviewing the leases. Here is a brief outline of what to look for, how to negotiate and where to go for more information:

1. Zoning. Some of the leases require the landowner to change the zoning to commercial use. In Kern County this is not required and unless you are certain you want your property to be commercial for a very long time, you may not want to do this.

2. Easements. Many of the leases contain language giving the power companies easements to cross your land. Negotiate separately for these and see if they are for a set number of years or permanent.

3. Mechanic's Liens. Sometimes companies start a project on someone's land and then run out of money. The contractors who do the work and don't get paid can sometimes put a lien on your land if you don't require the wind company to explicitly indemnify you agains such liens incurred by them.

4. Money. How much is a wind lease really worth? The new turbines are much bigger than the old ones from the '80's. Some leases offer to pay per acre of land, some per megawatt, some a flat fee, some a yearly minimum with a percent of energy revenue. This can be a complex matter. Ask how many megawatts the turbines are (nowadays 1.5-3 MW is common) and figure on about $5000 per year per megawatt per turbine as a minimum.

5. Talk to your neighbors. Chances are if you've been approached, so have your neighbors. Compare offers, join together to negotiate. In this case there is power in numbers and there are often incentives for gettting a whole section (640 acres) to sign on with one company. The first man in does not usually get the best deal in this business. Landowners who have already signed thinking they must take the first offer out there are usually the ones who end up with the least revenue and the worst contracts.

6. Ask for what you want. These companies have the money to build wind projects but they don't have the land.

7. Shop around. Chances are that if ENXCo wants your land, so does Oak Creek and Cal Wind and Alta and all the other companies out there. Don't be afraid to approach the wind companies to see if they are interested.

8. Contact a lawyer to review the lease before you sign. Unless you are extremely confident in your real estate law or just don't care, this will help you better understand what you are really signing up for. When you consider how much you have to gain from a good lease, it really does make it worth your while.

9. Length of the lease and renewal periods. These vary widely and you need to consider what you want out of the land 20, 30, even 50 years down the road.

Finally, check out this website: www.windustry.org for more information on wind energy and wind leases.

Good luck and be sure to pass this on to neighbors who may not have access to the internet.

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Topics: wind energy, wind leases, tehachapi wind
posted by MrsMcQ on Friday, April 4, 2008 at 01:43 PM
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