Caroline County Solar Opportunities, Challenges, and Best Practices - PowerPoint PPT Presentation

Caroline County Solar Opportunities, Challenges, and Best Practices May 25, 2017

Agenda INTRODUCTION  Open Road Renewables PART 1: Solar Farms 101 PART 2: Caroline County Solar Market PART 3: Solar Development Best Practices RESOURCES 2

Open Road Renewables  Greenfield developer of utility ‐ scale solar generation projects active in MD for >7 years  Chair of the Utility Scale Solar Energy Coalition of Maryland, Board member of the Mid ‐ Atlantic Renewable Energy Coalition, and active in MDV ‐ SEIA  Principals formerly with:  Pioneer Green Energy (developed 1,500 MW of operating/under construction wind and solar)  SunEdison (developed 18 operating solar projects)  Extensive development experience in large ‐ scale solar:  Great Bay Solar (150 MW) in MD owned by Algonquin → under construction  Nixon Solar (6 MW) in MD owned by SunEdison → operating  Wildwood (40 MW), Rio Bravo (40MW) & Pumpjack (20MW) in CA owned by Duke Energy → operating  Primarily focused on PJM; typical project size 50 ‐ 150MW; targeting 2019 ‐ 20 COD  Active in Maryland solar market for > 7 years and developing in Caroline County > 2 years 3

PART I Solar Farms 101

Photovoltaics  PV: cells → modules → panels → arrays  Non ‐ thermal/non ‐ combustion  Photons from sunlight strike semiconducting material & excite electrons to generate current panel array 5

Utility ‐ scale Solar: Components  Panels  Crystalline (lower cost)  Thin ‐ film (higher production)  Racks (Fixed or Tracking)  No foundations → piles or screws  Sufficient depth (4‐8 feet feet) to overcome wind loading  8 ‐ 12 feet high (high end of module)  Fixed ‐ tilt (south ‐ facing)  Uses less land  Lower cost  Single ‐ axis trackers (rotate east ‐ to ‐ west)  Higher production 6

Utility ‐ scale Solar: Components, con’t  Medium ‐ voltage transformers  Medium ‐ voltage collection lines  34.5kV  2 ‐ 3 feet below grade  Inverters (convert DC to AC)  Central: 1 inverter per 2+ MW; concrete block foundations  String: small; incorporated into racking 7

Utility ‐ scale Solar: Components, con’t  Fences  Blocks of panels fenced and locked for security and safety  Typically 6 ‐ 8 ‐ ft, chain ‐ link topped w/barbed wire  Access roads ‐ aggregate  Pyranometer station ‐ usually 15 x 15 ft  Measures solar & other weather data  Project switchyard  Step ‐ up transformer increases voltage from 34.5kv to transmission voltage 8

Utility ‐ scale Solar: Land  Previously disturbed (minimizes wildlife and habitat concerns)  Flat (<3% is ideal; >9% is challenging)  Level or sloped slightly to south  Dry (ease of construction; protect equipment; avoid flooding, wetlands and wildlife)  Clear (no shading of panels; avoid complexity and cost of clearing; aesthetics)  Good soil (ample soil before bedrock; few rocks; good resistivity)  Large farm fields typically are excellent candidates for solar  1 large block or adjacent/nearby blocks separately connected to switchyard 9

Utility ‐ scale Solar: Land, con’t  Orientation:  Fixed tilt → rows run east ‐ to ‐ west  Tracking → rows run north ‐ to ‐ south  Space between rows: (12 ‐ 18 feet)  Enough to minimize panels shading each other  Access for replacements, repairs and maintenance  Access for mowing  Within a block of panels, more of surface  3 ‐ 4 acres/MWac for fixed; 6 ‐ 8 acres/MWac for is open than occupied tracking  300 ‐ 800 acres for 100 MW  Blocks of panels are connected to each  Tracking uses more land than fixed ‐ tilt, but other or switchyard by buried collection generates cheaper power lines  Better land characteristics = less land use 10

Utility ‐ scale Solar: Operational Impacts Type of Impact Impact Details Fuel Spills None Sun only; no pipelines Air Pollutants None No combustion (except vehicles) Water Usage Minimal Panels are cleaned 2 ‐ 3x/year to eliminate “soiling” that reduces production (possibly no cleaning in rainy climates) Water Discharges None Storm ‐ water only Waste Generation Minimal ▪ P anel cleaning ▪ E quipment replacement, repair and maintenance ▪ F ertilizer/pesticide storage for landscaping (far less than ag) Sound Minimal ▪ Very few moving parts ▪ Substation ‐ switchyard sound is same as any other ▪ Central inverters emit 48 ‐ 72 dBA at 10 ft.; background at 150 ft. ▪ Trackers (electric motors) emit very small amounts of sound ▪ Low profile; panels only 8‐12 feet high Viewshed Minimal ▪ Panels conform to land surface and have a neat and orderly look ▪ Minimal (<2%) reflection; use of non‐reflective glass ▪ Sensitive locations can be addressed by setbacks or screening 11

Utility ‐ scale Solar: “End of Life”  Solar modules use simple & long ‐ lived technology that can generate electricity for decades. Some of the first solar panels ever manufactured are still operating today! Tier 1 modules are warrantied for 25 years but can generate power for 40 or more years  Crystalline (silicon ‐ based)  80+% glass and aluminum; up to 10% silicon; balance is mostly copper and polymers  In some modules, the only potentially hazardous material is lead in the solder  Passes EPA's Toxic Characteristic Leaching Procedure (TCLP) test: non ‐ hazardous → can be landfilled  Thin Film (Cadmium Telluride ‐ based)  Exceptionally thin: 1 ⁄ 26 thickness of a human hair  CdTe is solid, stable, and insoluble in water  Tested for safety during breakage and during fire  Passes EPA TCLP  Best way to prevent CdTe leeching is to encase it in glass (i.e., in a solar module)  First Solar recycles 100% of its modules 12

Solar Farms & Property Taxes – Personal Property  Solar projects at or below 2 MWs are property tax exempt in MD.  >2 MW is taxable. County can either: Pass legislation that applies a property tax rate to solar farms, or 1. Engage in a PILOT agreement in lieu of passing a new property tax 2.  Appraised value of grid ‐ connected solar farms >2 MW are determined by Maryland DOAT’s Utility & Railroad Valuation division  Electric Generation Property Return, Form 17 ‐ G is used to report all ‐ in cost of bringing a project online, including all equipment as well as costs like labor, sales tax, shipping, etc.  A 50% abatement is applied to determine the appraised value.  3 1/3% annual depreciation rate is applied on the appraised value  Example: Parcel ID #02014114, 336.18 acres per county tax records  At 8 acres/MW  42 MW x $1m per MW  $42m x 50% abatement  21m appraised value x ??? solar tax rate  At 1% solar tax rate, this parcel would generate $210,000 in taxes in its first year  Applying this math to 2000 acres would generate $1,250,000 in property tax revenue in the first year per 1% tax rate 13

Solar Farms & Property Taxes – Real Estate  A change in property use from active farming to solar farming would represent a change in the underlying appraised value of the underlying real estate from agriculture to a market ‐ value  Caroline County calculates the appraised value by looking at either the purchase price of the property or a capitalized value of lease payments paid by the solar lease (ex. ~$10k/acre appraised value)  This represents a significant increase in real estate property tax value to the county  Example: Parcel ID #02014114, 336.18 acres per county tax records  2016 Assessed value (taxed as agricultural land) ‐ $127,900 ( $380.45/acre)  2016 Real property taxes payable as ag land: $1,456 ($3.83/acre)  Assessed value based on $10k/acre solar market value ‐ $3,361,800 ($10k/acre)  Real property taxes payable as solar land: ~$38,257 ($113.8/acre)  On this sample parcel, real property tax revenues to the county would increase by ~30x, not including the personal property tax from the solar equipment shown on the previous slide  Applying this math across 2000 acres, total real property tax to the county would increase by ~$220k 14

Utility ‐ Scale Solar can be a major long ‐ term contributor to County revenues without impacting County ‐ wide agricultural industry, lifestyle, or sense of place  While total potential for solar is limited in Caroline County due to a congested electric transmission system and limited transmission infrastructure, solar can have an out ‐ sized positive impact on the County’s revenues w/out Assumes 2% solar property tax impacting county ‐ wide farming industry  Converting just 2% of Caroline County’s farmland to solar could result in a 15% increase in annual property tax revenues, not counting indirect benefits from new capital investment and jobs  Ex. A single 100 MW solar farm would take up between 400 and 800 acres and would increase county property tax revenue by ~$1m/year (assumes 2% solar tax)  Note: Caroline County currently has 2 proposed projects totaling ~300 MW. If successful, those 2 projects could increase direct county tax revenue by ~$3m/year

PART II Caroline County Solar Market