Tuesday, February 17, 2015

MinnWind Goes Broke -- February 17, 2015

This was reported over a month ago but not much national press. I completely missed it. A reader reminded me. StarTribune is reporting:
The companies that collectively own the two Minwind Energy projects filed for reorganization this week in U.S. Bankruptcy Court in Minnesota. The owners stand to lose their investment, and the wind farms eventually may have to shut down, according to regulatory filings.
It is the first of the state’s approximately 100 operating wind power projects to seek bankruptcy protection, and the case is raising questions about whether the small-scale wind farm model still works in an era of ever-larger wind-generating projects.
Additional background:
The Minwind wind farms, with 11 turbines that went on line in 2002 and 2004, made a profit until 2012, and are still operating, according to its financial reports. The electricity is sold to Minneapolis-based Xcel Energy and Cedar Rapids, Iowa-based Alliant Energy under long-term deals. Some of Minwind’s power is fed into a giant battery built by Xcel near Luverne to store electricity for when the wind doesn’t blow.
Minwind has told federal regulators that the turbines have needed extensive repairs, including main bearings, and the company no longer can afford the upkeep.
To make things worse, Minwind got into a jam with the Federal Energy Regulatory Commission for not filing certain paperwork since 2006. The result is a $1.9 million regulatory liability that has left a potential buyer uneasy about signing a deal to acquire the wind farms.
Minwind’s attorneys have told the government that the owners were “unsophisticated” in regulatory matters, and should be excused from the filing lapse. Some of the owners also had invested in the former Agri-Energy ethanol plant in Luverne, which was sold in 2010 to another biofuel company.
From another article:
The 360 individuals who had invested in MinWind did so by purchasing $5,000 shares. Individuals could purchase as many shares as they wanted, and the one-time public offering led to a sell-out of shares in one night.

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