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SPILMAN THOMAS & BATTLE.pLLc ATTORNEYS AT LAW Susan J. Riggs Direct Dial: 304.340.3867 E-Mail: [email protected] VZA HAND DELIVERY Ms. Sandra Squire, Executive Secretary Public Service Commission of West Virginia 201 Brooks Street Charleston, West Virginia 25301 Re: Case No. 12-1196-E-CS BEECH RIDGE ENERGY 11 LLC Application for a Siting Certificate to Authorize the Construction and Operation of a Wholesale Electric Generating Facility in Greenbrier County, West Virginia Dear Ms. Squire: Enclosed for filing on behalf of Beech Ridge Energy I1 LLC in the above-referenced matter are the original and twelve copies of the following: 1. Direct Testimony of Kevin E. Parzyck Please do not hesitate to contact me if you have any questions regarding this filing or require additional information. Very truly yours, I /A fi Susan J. Riggs (WV State Bar Nr5246) Lee F. Feinberg (WV State Bar No. 1173) Grant P.H. Shuman (WV State Bar No. 8856) SJR/rad:4334539 Enclosures cc: Certificate of Service Spilman Center I 300 Kanawha Boulevard, East I Post Office Box 273 I Charleston,WestVirginia 25321-0273 www.spilmanlaw.com 1 304.340.3800 i 304.340.3801fax West Virginia North Carolina Pennsylvania Virginia CERTIFICATE OF SERVICE I, Susan J. Riggs, counsel for Beech Ridge Energy I1 LLC, do hereby certify that on this 27th day of December, 2012, a copy of the foregoing Direct Testimony was served upon the following counsel of record as follows: VIA HAND DELIVERY John Auville, Esquire Staff Attorney Public Service Commission of West Virginia 201 Brooks Street Charleston, West Virginia 2530 1 Counsel for Commission Staff VIA U.S. MAIL Vincent Trivelli, Esquire The Law Office of Vincent Trivelli, PLLC 178 Chancery Row Morgantown, WV 26505 Counselfor WVState Building and Construction Trades Council, AFL-CIO DIRECT TESTIMONY OF KEVIN E. PARZYCK ON BEHALF OF BEECH RIDGE ENERGY I1 LLC Dec 27,2012 PUBLIC SERVICE COMMISSION OF WEST VIRGINIA CHARLESTON Case No. 11-1196-E-CS Beech Ridge Energy I1 LLC Application for a Siting Certificate to Authorize the Construction and Operation of a Wholesale Electric Generating in Greenbrier County, West Virginia DIRECT TESTIMONY OF KEVIN E. PARZYCK IQPlease state your name and business address. 2A My name is Kevin E. Parzyck. My address is One South Wacker, Suite 1900, Chicago, 3 Illinois 60606. 44 By whom are you employed and in what capacity? 5A I am Vice-president of Development of Invenergy LLC (“Invenergy”). My educational 6 and professional qualifications are set forth in Appendix A to this testimony. 74 What are your duties and responsibilities? 8A As Vice-president of Development, I oversee and coordinate the complete development 9 process for wind energy projects including the Beech Ridge Energy I1 LLC (“BE 11”) 10 wind project. Project development includes site selection, securing site control and 11 development rights, establishing budgets and schedules, preliminary engineering, 12 environmental and regulatory permitting, and local and governmental relations. My 13 responsibilities to a project also include the negotiation of contracts for the sale of 14 electricity, financial modeling and economic analysis. 15 Q What is the purpose of your testimony? Kevin E. Parzyck Direct Testimony Page 2 I A The purpose of my testimony is to sponsor BRE 11’s application for a siting certificate to 2 construct and operate a wind power Wholesale Electric Generating Facility (the 3 “Facility”) and ancillary facilities (the “Facility” and the ancillary facilities are 4 collectively referred to herein as the “Project”) in Greenbrier County, West Virginia (the 5 “Application”). 6 Q Please outline your testimony. 7 A I will testify concerning the following: 8 1. Invenergy’s experience and expertise ,,I the development, construction and 9 operation of electric generating facilities; .. 10 11. Description of the Project; I1 iii. Project location; 12 iv. Project construction and operation; 13 V. Exempt Wholesale Generator Status; 14 vi. Need for the Project; 15 vii. Expected financing of the Project; and 16 viii. Economic benefits of the Project. 17 Q Please summarize your testimony. 18 A BRE 11, through Invenergy, has the experience and expertise necessary to successhlly 19 develop, finance, construct and operate the Project. There is a need for new generation in 20 this region of the nation, particularly renewable generation, which the Project will fulfill. 21 The Project is ideally suited for Western Greenbrier County, where there is a substantial 22 wind resource. In addition, the acreage comprising the Facility is located within a 70,000 23 acre tract primarily owned by one company whose acreage is utilized for the highly Kevin E. Parzyck Direct Testimony Page 3 I compatible uses of mining, timbering, and forest management. The Project will bring 2 significant economic benefit to the local economy and the State economy through 3 construction jobs, permanent jobs, local purchases, and the payment of taxes to 4 Greenbrier County and the State. 5Q Please outline BRE 11’s request in this proceeding. 6A By its Application filed with the Public Service Commission of West Virginia (the 7 “Commission”) on August 24, 2012, BRE I1 is requesting the Commission grant an 8 electric generating facility siting certificate to BRE I1 to construct and operate the Facility 9 and other necessary appurtenances. 10 Q. Is the adjacent Project owned by Beech Ridge Energy LLC (“Beech Ridge”) under a 11 siting certificate granted by the Public Service Commission of West Virginia? 12 A. Under the siting certificate granted Beech Ridge, 67 wind turbine generators (“WTG”) 13 have been constructed and placed into service. Opponents of the project brought a civil 14 action in the United States District Court for the District of Maryland, and in early 20 10, 15 the Court approved a settlement between Beech Ridge and the plaintiffs that prohibited 16 construction beyond 67 WTGs until Beech Ridge had secured an Incidental Take Permit 17 (“ITPyy)under Section 10 of the Endangered Species Act from the United States Fish and 18 Wildlife Service. Under a further settlement and amended Order in the federal case, 19 Beech Ridge or an affiliated company was allowed to construct 33 additional WTGs 20 provided they were generally on the western side of the original Beech Ridge footprint or 21 on additional land to the west of the original footprint. These 33 additional WTGs 22 constitute the BRE I1 Project, and are proposed to be constructed on western portions of 23 the original Beech Ridge footprint and land immediately west of the original footprint. Kevin E. Parzyck Direct Testimony Page 4 1 Further, the existing Beech Ridge 138 kV transmission line from the Beech Ridge 2 substation to the Monongahela Power Grassy Falls substation has capacity to carry the 3 additional energy that will be produced by the Project, thus no new transmission line is 4 required. 5 INTRODUCTION TO BRE I1 6 Q Please describe BRE 11’s corporate structure. 7 A BRE I1 is a Delaware limited liability company and is a wholly-owned direct subsidiary 8 of Invenergy Wind Development North America LLC (“Invenergy Wind”). Invenergy 9 Wind is wholly-owned by Invenergy Investment Company LLC (“Invenergy 10 Investment”) a Delaware limited liability company, with principal offices in Chicago, I1 Illinois. Invenergy Investment is a developer, owner and operator of power generation 12 and energy delivery assets. Invenergy Wind is a wind energy development business. 13 BRE 11 holds a certificate of authority from the Secretary of State of the State of West 14 Virginia authorizing it to transact business in West Virginia. 15 Q Please describe Invenergy Investment’s experience and expertise in the 16 development, construction and operation of electric generation facilities, 17 particularly wind power facilities. 18 A Invenergy Investment has a superior track record of successful projects in the energy 19 industry and a highly experienced management team. The members of the Company’s 20 senior management team have an average experience of approximately 20 years in 21 diverse areas of the energy market including development, engineering, construction, 22 finance, operations, asset management, and energy trading and contracting. Invenergy Kevin E. Parzyck Direct Testimony Page 5 1 Investment is headquartered in Chicago. International development is focused on the 2 European and Canadian wind energy markets. 3 Invenergy Investment is in the process of building a portfolio of energy projects in North 4 America and Europe by developing greenfield projects and acquiring projects. Invenergy 5 Investment currently has a large portfolio of electricity generation and energy related 6 projects in development, construction and operation including numerous power 7 generation projects under long term contracts for electricity sales. This portfolio includes 8 projects generating electricity with wind turbines, photovoltaic solar installations as well 9 as conventional thermal electricity generation facilities utilizing a wide variety of fuels. 10 Q What activities has Invenergy Wind undertaken to secure its position as a leading I1 wind energy company? 12 A Invenergy Wind is executing a large and regionally comprehensive wind energy 13 development program. Currently, Invenergy Wind has active development in more than 14 20 states in the U.S. along with development programs in Canada and Europe. Of course 15 Invenergy Wind developed and oversaw the adjacent Beech Ridge Project. 16 THE PROJECT 17 Q Please describe the Facility. 18 A The Facility will include up to 33 wind turbines and an associated electric collection 19 system ((‘ECS’’) BRE I1 anticipates that it will utilize a GE 1.6-100 wind turbine (“GE 20 1.6’7, which has a four piece tower that measures 3 15 ft. (96 m) with a rotor diameter of 21 328 ft. (100 m). However, the particular turbine model selected for the 33 turbines will 22 be based on turbine efficiency, turbine availability, the ability to change the cut-in speeds 23 and turbine pricing.