Exelon Corp. (NYSE: EXC) reported in its Aug. 9 quarterly Form 10-Q report that it recently lost a court decision in Delaware related to wind projects.
In 2013, Deere & Company filed a lawsuit against Exelon Generation in the Delaware Superior Court relating to Exelon Generation’s acquisition of the Deere wind energy assets. Under the purchase agreement, Deere was entitled to receive earn-out payments if certain specific wind projects already under development in Michigan met certain development and construction milestones following the sale.
In the complaint, Deere seeks to recover a $14 million earn-out payment associated with one such project, which was never completed. Exelon Generation has filed counterclaims against Deere for breach of contract, with a right of recoupment and set off. On June 2 of this year, the Delaware Superior Court entered summary judgment in favor of Deere.
Said the Form 10-Q about that court decision: “Generation is reviewing the decision and determining whether to appeal to the Delaware Supreme Court. Generation has accrued an amount to cover its potential liability.”
The June 2 court decision shows that the dispute centers on the relocation of the 81-MW Blissfield Wind Project within the state of Michigan. The wind project had a power purchase agreement in place with Consumers Energy at the time Exelon bought this and other wind assets in 2010 from Deere. When problems came up with securing local approvals in Lenawee County for the Blissfield project at the original site, Exelon acquired the development rights for the Beebe Wind Farm in Gratiot County and assigned the Blissfield PPA to that facility. Beebe went into commercial operation in 2012.