Hello,
I'm a landowner currently negotiating a lease with a wind developer to develop a commercial-size wind farm.
I've been reading through a PPA, and my question is, what exactly is Renewable Power Compensation, and Test Energy. Specifically I'd like to know if this income would be included in the "gross revenue" definition. Currently the lease reads that I am to receive a percentage of the gross revenue from the commercial sale of electricity and any associated environmental attributes (ie RECs, green tags...).
THANKS for any help!

Hi Brenda. Brilliant idea on the CLE course. I am being courted by a Wind Developer and have many questions about their proposed contract. I will start with their definition concerning "Gross Revenue". It sounds like you have done your research...do you have any general advice on the following definition of Gross Revenue (Gross Operating Proceeds): "All gross receipts actually received by CPV from the sale of electricity generated by the Wind Energy Project (excluding the sale of electricity in connection with testing)." It does not seem that this definition is very friendly to the landowner. What would stop the Wind Developer from creating a spin off and simply bypassing the land owners potential royalties all together? Just curious if you, or anyone else, had any thoughts?
Thanks,

To help me through negotiations, I've read through your site, read The Law of Wind, and also enrolled in a continuing legal education online course given by the University of Texas School of Law. The materials are available to anyone interested, and the information is easy to understand. I think it cost $75-100, and was worth every penny!

Also, I initially got area landowners together and marketed the collective properties together to various developers. Doing so drove our offers up, and gave us a chance to "interview" developers we'd like to aquire as potential long-term business partners. Through this process, I learned about various offers and contract structures. This has also helped a lot during negotiations.

I'm a little ways off from a deal and so I can't say it has been a success yet! However, regardless of the outcome I've learned a lot, and it did bring the "neighborhood" together.

We'll see what happens!

Brenda,

It sounds like you've done a lot of work with this! I bet our other readers would love it if you could share some tips and tricks about how you approached the negotiation and your decision making process.

You're definitely right about not getting a re-do! It's critically important that everyone takes this process as seriously as you obviously do.

Marin

Hello Marin,

Thank-you for your quick response. I have hired an attorney and feel he has done a good job so far. However, since this contract would essentially be estate planning, I want to make sure I understand the contract 110%, and therefore try to read as much as possible about the wind industry. I don't get a re-do if I mess up

I just came across those terms, and thought I'd post on here in case someone was familiar with them. Contract negotiation has been quite the experience, and I've learned that conditions in a contract are far more important than the financial terms!

Thanks again!