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September 16, 2014

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Solar plant builders decry freeze

Federal study of environmental effects comes with a moratorium on new project applications

The federal government will do a sweeping study of the environmental effects of solar power plant development on public land in the Southwest, in part to speed up approval of solar projects.

But for developers, the study may be a fast track to the slow lane. While the Bureau of Land Management, which controls 67 percent of Nevada land, including many rural areas where solar arrays would be located, completes a lengthy study, the agency will impose a moratorium on new applications to put solar panels on federal land. Developers will have to wait at least 22 months — until at least spring 2010 — for the results of the study.

The BLM says the moratorium is needed because it has a backlog of pending applications and many of the requests are highly complicated.

Solar developers say the lag of nearly two years will hurt.

“That immediately is going to slow the momentum of a growing economy of solar business in the state of Nevada,” said Chris Brooks, director of the renewable energy division of Bombard Electric, which installed solar panels at Nellis Air Force Base. “Twenty-two months will drive businesses out of existence.”

Those in Nevada could be particularly hard-hit because 87 percent of its land is federally controlled, including the 67 percent that is BLM land; the other 20 percent is managed by other federal agencies such as the Air Force, the Energy Department and the National Park Service.

Brooks and other solar energy insiders said the moratorium, especially coupled with uncertainty in Congress over long-term tax credits for solar development, would discourage solar manufacturers from locating in the Southwest.

“If you delay the process much ... industry might go to another nation,” Brooks said. “If you’re going to make the process more cumbersome in all six states where solar is most viable, there is absolutely no sense in locating manufacturing” in Nevada.

And that means lost potential jobs, according to a solar industry insider who asked to remain anonymous because he must work with the BLM on future projects.

“It’s really bad for the solar industry and it’s really bad for Nevada,” he said. “It means delays in jobs, delays in economic development, increased reliance on natural gas, electric power. What’s the upside?”

The BLM has received 125 applications — including 23 in Nevada — to use federal land for solar plants.

The oldest of the 125 was filed more than three years ago, according to Katherine Gensler, manager of regulatory and legislative affairs with the Solar Energy Industries Association.

Gensler and Linda Resseguie of the BLM said delays on some of those applications are due to developers new to the solar industry not meeting BLM deadlines.

Gensler said BLM is so backed up with pending applications that the agency couldn’t have begun analyzing new requests before the study is completed anyway. Still, the moratorium has the industry buzzing.

The Nevada applications, 11 in Nye County and 12 in Clark County, would involve 211,000 acres of federal land and could produce 15,000 megawatts, more than twice the peak summer load in Southern Nevada. The 125 applications nationwide, if approved, would power 20 million American homes, according to the BLM.

Gensler said most of the Nevada applications were filed in 2007.

Resseguie said many developers expressed concern over the moratorium at a meeting Monday in Riverside, Calif., where the BLM took public comment on the scope of the study. Another meeting was scheduled for Tuesday night in Barstow, Calif.

The Las Vegas meeting is at 6 p.m. today at the Clarion Hotel and Suites, 325 E. Flamingo Road. For information, visit www.solareis.anl.gov.

“Obviously it (the moratorium) took some companies by surprise and is going to affect their business plans,” Resseguie said. “Some of the companies ... are more affected by our decision than others.”

Gilbert Cohen, vice president of engineering and operations for Acciona Solar Power, the company that built a large solar plant in Boulder City, said his company is one of those hurt by the moratorium. It could keep Acciona from filing applications for at least two large-scale solar projects in Southern Nevada, although he couldn’t estimate how much that might cost the company.

“It’s the cost of not doing business,” he said.

The BLM in 2006 completed a similar study of the effects of wind farm development in the Midwest. The agency did not, however, halt applications during that process, which began in 2003. Resseguie said that was because wind resources were geographically dispersed and there were no multiple applications for any single location, as there are in California for solar plants.

She said the BLM may in the future hold competitive auctions for parcels with multiple solar applications.

But in the meantime, the freeze could place a dollar value on applications filed, which may drive partnerships and deal-making in the industry, Resseguie said.

And the limited number of active applications moving through the BLM queue could drive up prices, said Tom Fair, renewable energy executive for Sierra Pacific Resources, Nevada Power’s parent company. He called the 125 existing applications “a bit of a land rush.”

Another concern is that over the course of the 22-month moratorium, the fast-moving solar industry may develop new technologies that won’t be analyzed by the BLM in its study, he said.

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