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Wind Force Plan brings new level of landowner involvement

Tri Global Energy's Bearkat Renewable Energy wind power project in Glasscock County, Texas, demonstrates a new level of landowner involvement, with a proprietary business approach called the Wind Force Plan.

By Diane Mettler

Tri Global Energy (TGE) is a leading utility-scale developer, responsible for over 60 percent of all wind energy projects currently under construction in Texas—the nation's leader in wind capacity. But that's not what makes Tri Global Energy unique. The company's focus on a win-win relationship with investors, landowners, and the environment is what truly sets them apart.

In 2009, a wind farm developer approached landowner John Billingsley and a group of his neighbors. As a businessman, Billingsley was interested in how the project was put together, and he found out it was completely oriented toward the developer and the major equity partner.

"It was just so one-sided," says Billingsley. "I tried to talk the developers into changing their lease to make it at least more favorable to the landowner, and they wouldn't do it. So I decided to heck with it, I'd just start my own company."

Flash forward almost a decade later. Billingsley is now the CEO of Tri Global Energy. The company's success is derived from the power of local communities where the company conducts business and the company's leadership that develops unique partnerships and innovative programs.

"We have a proprietary business plan called the Wind Force Plan, which involves quite a bit of community involvement. That's basically become our strong point," says Billingsley. "We have the reputation of dealing well with landowners."

Billingsley understands landowners, having grown up on a farm in West Texas, and he still owns farmland where he grows cotton. "I've got a lot of empathy for those people," he says. "I put together a business plan that involved their participation in all aspects of the wind project—from the management to participating in the profit in varying degrees. Once that word got around, we got really busy.

"During 2011, 2012, and 2013, we received more offers to do wind farms from various places than we could keep up with."

This year, TGE has 18 projects in various stages of production. One of its latest wind projects, Bearkat Renewable Energy, is located in Glasscock County, Texas, about 150 miles south of Lubbock. Bearkat spans nearly 30,000 acres, and at the completion of the two phases, it will produce close to 360 megawatts (MW).

 
  

The first phase, which took nearly seven months to complete, will soon be generating 197.6 MW of wind energy. The second phase will produce 162.1 MW, and construction will be initiated immediately after the first phase is up and running, producing energy.

"The people out there—the farmers and the ranchers and the other people in the community—were really excited and anxious to put together a wind farm on their properties," says Billingsley.

"They were so excited that they got together and came to my company and initiated themselves with us. Although that's not normally how projects are started," Billingsley says.

Normally, TGE selects a site near a Wind Energy Transmission of Texas (WETT) substation and transmission line. "It costs anywhere from $750,000 to over a million dollars a mile to have an interconnection transmission line between a site and an interconnection substation," says Billingsley. "The closer to a substation you are, the less the project is going to cost."

After site selection, TGE will then orient the site to suit that particular spot. "Then we just kind of draw that into a rectangle and start leasing land inside that," explains Billingsley. "Each farmer or rancher or landowner who leases land to us will share in the production whether they get a wind turbine on their particular property or not, based on the number of acres in relationship to the total acreage.

"So instead of paying them an upfront fee like most of our competition did and still does, we give them a guarantee that if we do develop a wind farm, they're going to get production. They're going to get electricity royalties for the next 50 years."

A separate LLC is formed for each wind farm. "Each of the landowners are given a piece of the equity in the wind farm, so they would share in the profits," says Billingsley.

Normally TGE wind projects include 50 to 125 landowners. With the Bearkat project, there were about 55 different landowners involved.

TGE raises the four to five million dollars of development money needed to get a wind farm from initiation to construction from community investors who live and work in the area.

 
  

"Quite a few of them are the landowners themselves," says Billingsley. "And they also participate in the royalty. We create a management team where there's normally four or five prominent landowners or investors who live out there, and they are the managers with TGE on the separate LLCs."

With Bearkat, as with all of the company's projects, TGE has local people managing with them, under the company's guidance. "We have an exclusive development contract with them," Billingsley says. "They know everything that's going on. It's very transparent. They feed that information back to the community. In fact, our landowners and investors out at the project site usually include two or three county commissioners, district judges, and other people who are involved in the community. We get all kinds of cooperation out there."

After the site has been selected, TGE hires environmental and transmission engineers to do the various types of testing to satisfy all the permits and other requirements. While the permitting and environmental studies are taking place, TGE looks at equity partners.

With the Bearkat project, TGE partnered with Danish company Copenhagen Infrastructure Partners (CIP)—one of the major renewable energy developers in the world, although they are just getting involved in the U.S. The partnership is a good one and currently, Tri Global Energy has a number of projects lined up with CIP.

For the engineering, procurement, and construction (EPC) contractors, Tri Global Energy selects bankable companies and puts the project out for bid. "But we know which ones we like to work with and have done a good job," says Billingsley. "We're also involved with all of the major turbine suppliers, so those go out to bid. You look at the major companies, the particular aspects of the wind and see which turbines would fit."

The EPC on the Bearkat project was Black & McDonald, and the electrical contractor was Rosendin Electric. The environmental engineers on the project were Westwood Professional Services.

 
Tri Global Energy's Bearkat Renewable Energy project is about 150 miles south of Lubbock and spans nearly 30,000 acres. At the completion of the two phases, it will produce close to 360 megawatts of wind power. 
  

In November, Global Wind Service, which employed over 60 technicians over the course of the project, installed the last of the 57 Vestas V126 3.45 MW turbines at Bearkat I. The V126 turbines were a little bigger, taller, and heavier than many of the other turbines, which was ideal for this site.

"There are about four or five major Tier A turbine manufacturers, and each one has several models than can work," Billingsley says. "We deal with all of them and select the company based upon the competitiveness and how efficient it is for our particular project and for their turbine's specific purpose."

As for the transformers, Tri Global Energy went with SGB-SMIT, a company based in Germany. And for the actual construction, the roadwork, cranes, etc., local companies are used as much as possible.

Because of all the work up front, time spent developing contracts with the landowners, and the company's top-notch managers and consultants, the Bearkat project was constructed with little issue. Construction began in April 2017, and the facility was producing power in December 2017.

So what started as one dissatisfied landowner in a wind farm project in 2009 has turned into a major company, with about 18 projects in development and more than 50 employees. It has attracted top consultants and partners from all over the U.S., as well as from Europe and Asia. "They are now coming to us to see if they can give us their services," Billingsley adds.

The company's unique business model requires a lot of one-on-one with landowners. Right now, the company is dealing with 3,500 landowners and investors from its various projects. "It takes an awful lot of back office infrastructure to keep track of all of those folks. It's something that most big corporations aren't set up to do," says Billingsley.

TGE's unique business model is definitely paying off. By the end of 2017, TGE had concluded the development of over 1 GW of wind power, which represented a major milestone for the nine-year-old company.

"We are very proud of what we're doing," says Billingsley. "Most of these people who we're dealing with grew up on the land like me. My folks came out here in the late 1800s. A lot of these people are third, fourth, and fifth generation ranchers and farmers. And they're all very conscious of the land and the environment.

"Being able to work with a group of people like this for the betterment of their community, as well as the betterment of the United States and the world, really, using renewable energy is very much a blessing—and I'm very proud to be part of this industry."

 


March/April 2018