The three most important considerations for development of wind farms are: LAND with good to excellent wind resource CONTRACT to sell electricity produced ACCESS to transmission lines (proximity and carrying capacity)

Site selection Evidence of significant wind resource Preferably privately owned remote land Proximity to transmission lines => 69 kV (up to 25 miles for good site and => 135 kV). Note possibility of future transmission lines. Reasonable road access Few environmental concerns Receptive community

Land Term: expected life of the turbine (early 20 to 30 yr, 10 yr option; later 30 to 50 yr, multiple 10 yr options) Rights: wind rights, ingress/egress rights, transmission right of way for wind farm Owner compensation: percentage of revenue, per turbine, or combination Assignable: financing requirement Indemnification Reclamation provision Bond to remove wind turbines at end of project Wind energy easements, legal issues

Wind resource assessment Lease, $/acre, 1 to 5 years, or flat fee. Corollary data: wind maps (national, state, other), NWS data, Other Install meteorological tower(s), hub height or at least 50 m Collect 10 min or hour wind speed and direction data, 1-2 yr, minimum one year Quality report on meteorology Output projections for several turbine types Landowner receives data, meteorology report, and output projections if developer does not exercise option for installation of project.

Environmental Cursory review for endangered species Biological resources Wildlife habitat Loss of vegetation Avian studies Raptors Migratory birds Review with interested parties: Audubon, federal, state, local Required studies and reports Bats Archaeological sites Noise Visual Soil erosion and water quality Solid and hazardous wastes Active compliance monitoring

Economic modeling Output projections Turbine costs Turbine installation Roads, substations, transmission Communication and control Taxes: sales, income, property (depreciation schedule), tax abatement O&M estimates Finance assumptions: production tax credit, accelerated depreciation, equity rate of return, incentives (local, state), debt rate and term (coverage ratios), dept/equity ratio Other: insurance, legal

Interconnection studies Interconnection request, electric reliability council Capacity limitation Load flow analysis Voltage controls System protection

Permits Local, state, federal Public involvement at early stage Public land, private land Land use permit Building permit

Sale of energy/power Energy/power purchase agreement Long term contract with utility Green power market Market, avoided cost Renewable energy credits Future income, emission trading Kilowatt hour: real or nominal levelized Capacity: kilowatts Term Credit worthy buyer Facility sales agreement Turn key price, complete project

Financing Source of equity; rate of return 15-18% Source of debt Market rates Term of debt Assignable documents Third party due diligence

Turbine purchase Power curve (output projection) Turbine cost Turn-key construction cost Warranties; equipment and maintenance Construction financing Past history of manufacturer Availability of turbines, date

Construction (turn-key) Roads Water and gravel Turbine foundations (excavation, concrete) Interconnection to utility (substations, transformers, wire) Turbine assembly and erection (cranes) Commissioning Environmental restoration Reduce road width? Grass Control of noxious weeds Assembly area

Maintenance Fixed cost per turbine per year Availability warranties Penalties for non-performance Types of costs Labor Management Insurance, taxes Maintenance equipment; cranes, vehicles, other Parts on hand Non-recurring costs: major repairs Roads, maintenance and access for landowner