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November 26, 2014

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DAILY MEMO: SOLAR POWER:

Eager applicants line up to build plants

Federal agency has no formal policy for approving plans for Nevada desert

While debate continues in Congress over tax credits for renewable energy, solar developers are trying to solve America’s energy crisis on their own.

Applications to build solar power plants on federal land in Nevada have nearly tripled in the past two months — jumping to 65 from 23.

Earnest builders and land speculators, from venture capitalists, utility companies and solar developers, have staked claims in Southwest states in the hopes of developing large power plants or flipping the sites to companies that will.

But the Bureau of Land Management, which controls 67 percent of land in Nevada, has yet to approve a single solar plant on federal land. And the agency has no uniform policy or system for handling applications, unlike the system in place for other kinds of renewable energy.

The BLM recently auctioned off $28 million in geothermal leases on federal land in Nevada alone, with half the proceeds going to the state and a quarter to the counties where the land is located. The BLM keeps the other quarter.

In a time of budget gloom and doom, the state could certainly use the cash. So, for that matter, could the BLM, which attributes its slow progress on approving solar and other renewable energy applications in part to a lack of staff and funding.

So why, with the virtual land rush to snap up the best spots for solar energy, is the BLM not holding auctions for solar plant sites as it is with geothermal resource-rich land?

That’s where things get a bit sticky.

For starters, solar will fetch nowhere near the amount of money geothermal does because funding is distributed under different federal laws. Half the cash from geothermal leases goes to states, but the share is only 5 percent with solar. Still, with every kind of state tax revenue down this year, even 5 percent of $28 million — $1.4 million — is hardly chump change.

The greater hurdle is agency policy, according to Linda Resseguie, a BLM project manager. Agency policy is to approve solar leases on a first come, first served basis. Developers line up for the best spots, flat swaths of desert near large power lines, and wait in queue for years until the bureau gets around to reviewing their applications.

Creating a more ordered process for approving leases is one goal of a federal environmental review of solar development in six Southwest states, including Nevada, that was announced in May. The agency will consider changing policy to allow competitive leasing — auctions — of parcels in high demand.

With solar developers planting applications like flags on solar hot spots in the region, BLM instituted what turned out to be a short-lived freeze on new solar claims in the six states.

Backlash was immediate.

The BLM insists the freeze was not arbitrary or a stall tactic, despite indications that the presidents’ oil-and-gas-friendly agenda had trickled down to the bureau.

Although developers said they favored the review, they said a moratorium that could stretch to two years would cripple the industry.

Sen. Harry Reid struck back quickly, too, and the BLM promptly rescinded the freeze.

But what initially appeared to be a victory may work against the industry in the end. The BLM approval process remains gummed up, even as the applications pile up.

The BLM says the moratorium would have allowed a cooling-off period instead of allowing solar developers to engage in a free-for-all, picking up leases here and there, sometimes sight unseen.

“The whole idea of doing the (study) was ... to develop an orderly, thoughtful process for future solar energy development,” Resseguie said.

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