Fact-Checking the N&O

Yesterday, John Murawski over at the News & Observer reported on a judge’s denial of the Attorney General’s motion to dismiss in Owens v. North Carolina Department of Environmental Quality. The case, brought by the Civitas Institute Center for Law and Freedom (CLF) on behalf of Perquimans County landowners, alleges that the Department of Environmental Quality (NCDEQ) violated North Carolina law when it informed Iberdrola Renewables that the corporation’s Desert Wind Project (now the Amazon Wind Farm East) would not be subjected to state permitting standards. Earlier this week Judge Melissa Owens Lassiter denied a motion to dismiss filed by the Attorney General, who is defending the case for NCDEQ, clearing the way for the case to proceed to a contested case hearing.

We’ll walk through the News & Observer report and provide some commentary.

A Raleigh judge has refused to throw out a citizen lawsuit seeking to block the Amazon Wind Farm in eastern North Carolina, setting the legal dispute for trial next year.

The judge is technically sitting in Perquimans County, and that is where any hearings will take place.

Administrative Law Judge Melissa Owens Lassiter on Monday denied a request to dismiss the lawsuit filed by two residents of Perquimans County, where the 104-turbine energy project is several months into construction.

The husband-and-wife litigants – fireman Stephen Owens and IT administrator Jillanne Badawi – want to force the N.C. Department of Environmental Quality to subject the Amazon Wind Farm to a lengthy regulatory review that project developers have said would derail their $400-million wind farm.

If anyone is forcing DEQ to subject the Amazon Wind Farm to a lengthy regulatory review, it is the North Carolina legislature, who in 2013 enacted a state permitting process for such facilities. The Petitioners are merely asking that the Court require DEQ to follow the law.

The decision by Judge Lassiter of the N.C. Office of Administrative Hearings to keep the case alive means it will head for a contested case hearing, which is the OAH equivalent of a trial, said Elliot Engstrom, a lawyer for the conservative Civitas Institute, which is representing the Perquimans couple.

It is worth noting that Dr. David Schnare of the D.C.-based Energy & Environment Legal Institute has been granted a pro hac vice appearance in the case as well, and is serving as co-counsel.

The trial would likely get underway this spring, as the wind farm developer, Iberdrola Renewables, is pouring the concrete foundations for the nearly 500-foot tall turbines.

A hearing date will soon be set, most likely for March or April of 2015. It is possible that the case could be disposed of on summary judgment prior to a hearing.

The wind farm, which is being built in Perquimans and Pasquotank counties, will supply power to out-of-state data centers owned by online retailer Amazon. It will be the largest wind energy project in the Southeast.

Iberdrola has said it needs to complete the project next year to qualify for a federal tax credit that will reduce the cost of the project by 30 percent. The credit expires at the end of 2016.

If the Amazon Wind Farm were canceled, Pasquotank County would lose out on nearly $8 million in lost tax revenues and its farmers would forgo more than $10 million in lost lease revenues over the life of the project.

At issue in the dispute is whether the wind farm is subject to a regulatory review under North Carolina’s 2013 wind farm siting law. The law exempted any project that had received approvals from the Federal Aviation Administration when the law was enacted.

Our petition alleges that for purposes of the siting law (and in reality), Iberdrola’s current project is different than the one that received FAA approval in 2012.

Iberdrola later changed some specifications, increasing turbine heights and changing some locations, raising questions whether the company was modifying the same project or essentially starting a new project.

It’s worth noting that DEQ originally decided that the project would be subject to the siting law. One month later it reversed its decision due to a “renewed review of the Act.” What happened in the interim between the two decisions is still unknown.

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