ROKT Review of study done by Eco-Northwest:

Local Reaction to the Eco-Northwest "Economic" Studey of Wind Farms in the Kittitas Valley

Residents Opposed to Upper Kittitas Turbines, November 27th, 2002

stoptheturbines@comcast.net

SUMMARY

ECO-Northwest’s 1-month, $15,000 study, sponsored by the local business lobby organization, the Phoenix Group, has been met with deep skepticism in the Kittitas Valley. Regardless of how people feel about wind farms in this valley, most people recognize this report as simply a blatant endorsement of proposed local wind energy projects, bought and paid for by those behind these projects. A local newspaper story about ECO Northwest’s report titled “Are Wind Farm Benefits Full of Hot Air?” (The Yakima Herald-Republic, 10/2102) reflects this public skepticism about the impartiality of this study.

The report makes the incredible claim that property values will not be affected and the unsubstantiated claim that the county will receive millions of dollars in increased revenue. Although the wind energy companies state that they will hire only 22 people, the report manages to inflate this to 53 jobs and claims that these people will somehow result in an additional $4.2m being spent within the county.

ECO Northwest’s report also neglects to consider the effect of major wind farms on tourism, one of the most important factors in the local economy. It does not consider alternative locations for such projects, or alternative forms of renewable energy in Kittitas County, or whether the county will benefit from the power generated. Nor does it consider that the proposed location for these wind farms is an area that the city of Ellensburg will need for future expansion of its population, an area that will be closed off for housing if wind farms are built there.

REPORT’S PRO-WIND FARM BIAS IS OBVIOUS

The Phoenix Group has been a tireless advocate for Zilkha - the wind energy company that has announced its plans to build in the Kittitas Valley the third largest wind farm in the country – since these plans were announced in April. The executive director of the Phoenix Group, was quoted in Zilkha’s press release, as saying,

"This company has a very good reputation. The wind is a great opportunity for the county. The construction period will bring more jobs to the area and will create a demand for goods and services. The full time employees that will keep the wind farm operating will have good, family-type wages."

Over the last few months managers of the Phoenix Group have pressed board members to formally endorse the Zilkha project. Recently the group endorsed wind projects “in general” in the Kittitas valley.

The ECO Northwest study was funded, in part, by a grant that the Phoenix Group obtained from the Energy Foundation, whose mission is to lobby for alternative energy sources, especially wind power. The Energy Foundation’s web site (www.energyfoundation.org) has papers written by wind energy lobbyists, such as “Gone With the Wind: How California is Losing It's Clean Power Edge to Texas”. The Energy Foundation also promotes the idea of building wind farms in economically depressed areas such as American Indian reservations. (The Kittitas Valley is very far from being an economically depressed area.)

The Phoenix Group’s choice of ECO Northwest as their consultant is also viewed as being highly suspicious. ECO Northwest's practice is strongly oriented towards environmental studies and no-one is really surprised that they are biased towards “renewable energy” projects like Zilkha’s. (ECO Northwest is located in Portland OR, the location of Zilkha’s Northwest office.) ECO Northwest has done many “studies” for wind energy companies, some of which can be found on their web site (www.econorthwest.com). Recently ECO Northwest gushed, in a report titled “The Economic benefits of Renewable Energy”,

“Wind energy is the fastest-growing source of electricity in the world. The installed generating capacity in the US increased 65% between 1998 and 2000, and is projected to increase 80 percent in 2001. Wind energy is far more cost effective that it was ten years ago and will become even more cost effective in the future. The cost of electricity generated by wind declined over 80% in the previous 20 years and is projected to decline an additional 25% by 2005. Developing the wind potential of the US would create approximately 1 million short-term construction jobs and over 33,000 operations jobs. This underestimates the true employment impacts because it excludes the employment impacts associated with building the wind turbines.”

Reading their reports, it seems that ECO Northwest's "research" involves little more than interviewing wind energy company executives and unquestioningly quoting their optimistic estimates. No-one here really believes that this company was chosen impartially or that the Phoenix Group found this company, or the Energy Foundation’s grant, without Zilkha’s help.

REPORT’S CLAIMS OF TAX BENEFITS WILDLY EXAGGERATED

ECO Northwest's report summary states that “The construction of the wind farm will increase property tax revenues by approximately $2.8 million dollars annually.” But then the report actually contradicts this claim in section IV. Here it notes that a statewide initiative, I-747, limits property tax increases to 1 percent per year and that as a result the claimed $2.8M tax revenue increase is not likely to occur. ECO Northwest stresses that it is not an accounting firm and backs away from its initial claims of large tax revenue increases, saying “Actual revenues may ultimately be reduced to comply with the initiative.”

The Yakima Herald-Republic story, “Are Wind Farm Benefits Full of Hot Air?,” quotes Kittitas County Assessor Iris Rominger who disputes the ECO Northwest claim of $2.8m per year, saying that restrictions in property tax increases imposed by Initiative 747 would prevent that much money from being collected. (I-747 passed with strong support, including 63 percent voting for it in Kittitas County.) Yet the Phoenix Group continues to repeat ECO Northwest’s claim of $2.8m per year in additional tax revenue, and they have published the report’s detailed pie charts showing how this non-existent tax revenue would be divided up into fire districts, schools, roads, etc.

NO-ONE HERE BELIEVES PROPERTY VALUES WILL NOT BE IMPACTED

Kittitas residents, no matter what they believe about wind power, know that the third-largest wind farm in the US, on the outskirts of the city, will have a major impact on property values in the area. ECO Northwest’s ludicrous “proof” that there will be no effect indicates to most people here that the company is simply doing the bidding of the wind farm industry. A typical local opinion is expressed in the Yakima Herald-Republic story, “Are Wind Farm Benefits Full of Hot Air?,” which quotes Bill Allison, president-elect of the Kittitas County Realtors Association, as saying

“Many realtors are nervous about the effects of the wind farms. Most of the realtors have concerns that the land values will go down and it will be an eyesore. I'm just more concerned about the impact it will have on the view properties."

Roger Weaver, owner of Re/Max Community Reality in Ellensburg and Re/Max Alpine Realty in Cle Elum was quoted in the Ellensburg Daily Record saying,

“The proposed wind farms in the Kittitas Valley have clouded rural land use and the whole concept of country living. Wind farms have never been proposed in an area such as the Kittitas Valley where there is subdivided and developed property with scenic views and high recreational property values. There are locations where wind farms are more compatible with surrounding properties and would have less of an impact on values. If wind farms are allowed in the valley, they will lower property values for lots close to the towers.”

Lynn Jenison, owner of Windermere Real Estate in Ellensburg, was quoted in the same paper,

"My negative vote (on the windfarms) was predominantly from the real estate perspective. The impact of how it will affect the viewscape is one major issue that I have a problem with. I really do think people close to the wind farm are going to suffer some loss of value initially if the project goes up."

ECO Northwest’s report bases its incredible claim on its phone calls to just six tax assessors. No respectable study would claim this to be a legitimate research method. Tax assessors have no incentive to lower assessed value of a property, and their techniques are notoriously poor in determining the true market value of property.

The report states that these six tax assessors are in "areas with wind power projects similar to those proposed" for the Kittitas Valley. However none of the wind farms listed in the ECO Northwest report has turbines the size of those proposed for Kittitas county, and only one had as many or more than the number proposed here. How are these “similar projects”?

The wind farms used for comparison in the report are mostly in very remote locations; certainly they are all in far less densely populated areas than Kittitas county. None are anywhere near a city the size of Ellensburg. It is not surprising that ECO Northwest had trouble finding a comparable area - nowhere else in the US has a wind energy company attempted to build a wind farm of this magnitude so close to a populated area.

Although the ECO Northwest report claims that it carefully examined the published literature on this subject, it did not mention an environmental assessment for a proposed 20MW wind farm commissioned by the Tennessee Valley Authority in April of this year, which concluded,

“Studies on the relationship of views and property values show that desirable views do have a positive value on property values. For example, an ocean view added 147 percent to the market value of a lot, view of a creek or marsh, 115 percent, and a golf course view, 39 percent. These studies are consistent with the expectation of some negative impact on property values from a windfarm that has significant negative visual impacts.”

ECO-NORTHWEST REPORT MISREPRESENTS DANISH STUDY BY A FACTOR OF 1,000

In its report ECO Northwest notes that it could find only one study that specifically addresses the potential impact of wind turbines on property values – a Danish study. But the report then misrepresents the findings of that study by a factor of 1,000!

The report claims that this Danish study “showed that house values were 94 Danish Kroners (about $17 per home in 1995 US dollars) lower closer to wind farms than other houses located further away.” In fact this study, conducted by Munksgaard and Larsen in 1996, showed a decrease in housing prices of 94,000 Danish Kroner for a house close to a wind farm of 12 windmills. Exchange rates for 1995 translate this decrease to US $16,800. Incredibly, the Phoenix Group’s report has misrepresented this study by a factor of 1,000. And if this is the impact in 1995 dollars on a house near a 12-turbine wind farm, what will be the impact near a wind farm of over 300 turbines? Nothing at all, claims ECO Northwest.

This misrepresentation of the Danish study – which confirms the negative effect of wind farms on property values and contradicts ECO Northwest’s findings - is either deliberate, or unbelievably sloppy. If the former, then this report is merely marketing material for wind energy companies. If the latter then the quality of this study is evidence, showing it to be worthless.