Local insurance agents cautioned landowners to contact their insurance carriers before signing wind farm leases at a local county-wide meeting on June 11 at the Route 66 Interpretive Center.
Joseph Irby with Tedford Insurance said they hoped to give people as much information as they could and were working to find answers.
“If we don’t know the answers, that’s the bad thing, is because there’s a lot of variables. Insurance is a complicated game and when you throw in wind turbines, it gets more complicated,” he said.
According to Landon Tedford, who works in personal property, farms, and ranches, the turbines are insured for about $5 million. This would cover damage from a fire connected to a turbine on a neighbor’s land, though he was unsure of the deductible.
Tedford said the main point of concern from insurance carriers was the workers on the land both during construction and afterward. It could be a “sticky situation” with insurance, though landowners would typically only be found liable for injury to workers in cases of gross negligence on the landowners’ part.
He added that there are carriers that aren’t covering wind turbines and that some carriers who do allow turbines will start to exclude some things. Some carriers also require the turbines to be on a separate deed from farms.
Tedford said a common question they get is: If the taxes on the land rise and the property is worth more, would that affect the price of insurance? He said it wouldn’t have much of an effect. It could raise liability, but that doesn’t cost too much on policies and wouldn’t be much of a factor. The main thing is that putting a turbine on your property could limit your options in terms of carriers.
Irby added that before signing any lease, landowners should call their carriers.
“I think that’s the main thing to take away is, if you’re contemplating this at all, you need to make that call to your current carrier and ask because as this progresses, their answers might change,” he said.
State Insurance Commissioner Glen Mulready echoed this sentiment. He said the insurance companies he has spoken with have no issues or concerns with wind turbines on properties, though they will want to see proof of commercial coverage from the wind companies.
Thomas Holmes spoke on the land agreements that landowners could potentially sign. He presented information from a seminar white paper presented several years ago by McAfee and Taft, a law firm in Oklahoma City, and comments from someone familiar with land agreements.
He cautioned that agreements restrict the landowners’ use of the land and that they are prohibited from building structures that could cause destruction to the flow of wind. Additionally, while rights to other land uses, such as farming and ranching, are reserved, they are almost always subordinated to the wind company’s exclusive right to wind development, which Holmes said was 50 years. He also warned that the company could choose to buy 10 acres of landowner’s property with nothing more than a written notice.
“They decide what 10 acres they want. They come and give you an offer, and that’s the way it’ll be,” he said.
Anna Richey, senior public engagement manager with APEX Clean Energy who wasn’t present at the meeting Tuesday, clarified that 50 years is only an option. Landowners can opt to extend the 30-year lease twice for 10 years each after the initial lease term. She also shared a portion of the agreement that states that landowners can install trees, structures and improvements without prior written consent from APEX as long as it falls within a specific setback. They should be at least 1.1 times the height of the nearest wind turbine or 30 times the height of the new structure – whichever is greater – away from the base of any turbine or propose turbine.
Regarding the 10 acres, Richey said that is regarding land for substations or laydown yards, however APEX can only lease it, not own it.
Other topics discussed at the meeting included the effect on wildlife and livestock, presented by Dr. Theresa McKinzie. Jed Castle from News 9 also spoke, while other speakers addressed concerns about effects on the aquifer and how much tax money could actually be brought into Lincoln County.
The meeting also included testimonials from residents in Kansas about a wind farm project there.