Reasons to Sell Your Wind Turbine Lease Royalties for a Lump Sum Payment

October 21, 2020

1. Deploy the lump sum payment to improve or expand your existing business: Although only you and your professional advisors can determine if this is the right option for you, we have had numerous landowners indicate that they can make even more money than the rent/royalties expected to be paid over the lease term, by using even a discounted lump sum to pay for improvements or expansions of their existing business (e.g. by buying new equipment, additional land, etc.)

2. Eliminate the risk of non-payments in the future: It’s hard to imagine that a project owner would default on its obligations to pay rent or royalties in the future, but the fact is that until each rent payment is made over the 30+ year lease term, it’s always possible that the next check may not come.

a. Despite the fact that that it’s not in anyone’s best interest, it’s always possible that rent could stop being paid if the wind company were to have financial difficulties/file for bankruptcy, or if new technology should arise that makes it financially unreasonable to continue running the wind project, etc.

b. This risk can be eliminated immediately by selling your rights to future wind lease payments to MSE in exchange for a lump sum cash payment made immediately upon sale of the lease. In the event the rent or royalties are not paid in the future, then MSE will suffer the loss and will not have rights to repayment of the lump sum.

c. Again, although no one wants or expects this risk to happen, if it does, than MSE is in the best position to handle this lack of payment since, unlike the landowner, MSE has payment streams coming from multiple projects that are owned by several different parties. As a result, MSE can spread this loss around the many other lease payment streams that it has acquired throughout the country.

3. Use the money for otherwise unattainable matters: Whether this means paying off lenders or putting the money towards quality of life/enjoyable purposes, the fact is that MSE will provide you with this option. We understand the wind energy industry and we are able to value the risks and rewards of each lease, contrary to banks or general investors who will not lend against or buy these leases, due to the general lack of understanding of wind lease economics.

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