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Pandemic hasn’t slowed down large solar project development

Fears that the COVID-19 pandemic would substantially slow the development of utility-scale solar generation appear unfounded, at least for seven of the country’s biggest projects.

Fears that the COVID-19 pandemic would substantially slow the development of utility-scale solar generation appear unfounded, at least for seven of the country’s biggest projects.

To see if the pandemic, or anything else for that matter, had affected the progress of large solar generation projects, business intelligence provider FirmoGraphs looked at the seven solar projects in its database with construction costs ≥ $250 million whose developers wanted to start construction in 2021, despite not having all of the needed permits entering the year.

We found that while not all are proceeding apace, none has been seriously slowed. More specifically, the developers of all appear to have gotten the necessary permits for the projects, but one apparently has moved back the date by which it plans to have its project in service and at least two others didn’t meet their original deadlines for starting construction. Of the remaining four, two may have to hustle to get their projects into service by their target dates, and the two others appear to have their projects on track, even though one apparently moved back its construction start date.

In-service date moved back

The largest project is the one whose targeted in-service date has been moved back, likely because the Consolidated Appropriations Act, which President Biden signed last December, pushed back the phase-down of the investment tax credit (ITC) for solar energy, meaning the project’s developer doesn’t have to complete it by the end of 2023 or face a substantial financial penalty.

Fox Squirrel Solar is a ground-mount solar photovoltaic facility under development in Madison County, Ohio. The project plans to deliver 577 MW of clean renewable energy to the utility grid by the end of 2024.

Fox Squirrel Solar, which will have a capacity of 577 MW and a construction cost that FirmoGraphs estimates to be $583.3 million, was part of a pipeline of up to 4.5 GW of solar projects being developed by Geenex that EDF Renewables bought last October. In its October 2020 application to the Ohio Power Siting Board for a certificate of environmental compatibility and public need for Fox Squirrel, Geenex said it expected commercial operation of the project to begin no later than the fourth quarter of 2023. It also said that delaying the start of the project’s commercial operation beyond the end of 2023 “would have a significant and negative effect” on the project’s economics because it would preclude the project from qualifying for the full ITC. That concern is now gone, which may be why EDF’s website for Fox Squirrel says the plan now is for the project to be supplying power to PJM Interconnection’s grid by the end of 2024.

In its application for Fox Squirrel, Geenex said it expected the OPSB to grant a certificate for the project in the second quarter of this year. That proved to be too optimistic, but only by 15 days, as OPSB actually granted the certificate on July 15. Geenex also said in the application it expected construction to begin “as early as” the fourth quarter, which still seems possible.

Fox Squirrel would be located in Ohio, which this summer enacted a law that will make it harder to develop solar and wind projects in the state, but the law won’t affect projects as far along as Fox Squirrel is.

Construction-start dates missed

The developers of two other projects appear to have missed the target dates for starting construction on them but they still may be able to complete the projects by the end of next year, which has been their goal.

The largest of the two projects is Bright Arrow Solar, which has a capacity of 300 MW, will cost $275 million to build, and is being developed by RWE Renewables Americas in Hopkins County, Texas. Construction on it was scheduled to start June 1 and be finished at the end of next year, but two RWE officials said in late July that it hadn’t reached the construction phase yet.

The other project is Cavalier Solar A, a 240 MW solar farm planned for Surry and Isle of Wight counties in Virginia. We estimate it will cost $247.9 million to build, which is close enough to $250 million that we decided to include it in the projects whose progress we examined. Cavalier Solar A’s developer wanted to start construction on it by April 1, but Surry County’s board of supervisors didn’t approve it until May 6, and the developer wasn’t granted certificates of public convenience and necessity for it by the Virginia State Corporation Commission until May 27, so work on it is a little behind schedule. Still, getting it in service by the end of 2022 remains the goal, according to AES, which owns part of sPower LLC, the company that owns the project’s developer, Cavalier Solar A LLC.

Speed may be needed

Developers of another two of the projects we looked at would seem to still have enough time to meet their target dates for getting the projects in service, but they will be cutting it close.

The Arroyo Solar & Storage Project is a 300 MW-AC solar generation facility and a 150 MW battery energy storage system located in McKinley County, New Mexico. The Pintado Switchyard is a 345kV switchyard used to interconnect the Arroyo Solar & Storage Project. Both projects are scheduled to start construction in summer 2021. (Courtesy: Arroyo Solar & Storage Project)

The one apparently cutting it the closest is Centaurus Renewable Energy, the developer of Arroyo Solar & Storage, whose generation component has a 300 MW capacity and construction cost that we estimate will be $309.9 million. Arroyo is one of four solar and storage projects planned by Public Service Company of New Mexico to replace the capacity it gets from the coal-fired San Juan Generating station. Construction on the project is scheduled to start this summer and be finished next June, which is when the San Juan Generating Station is supposed to close, according to the website for the project.

In March, the New Mexico Public Regulation Commission approved the project and the McKinley County Commission approved industrial revenue bonds in the amount of $436 million for the project. In late June, Centaurus announced it had closed on a $70 million construction bridge loan facility for the project from a subsidiary of Voya Financial, Inc., but if it hadn’t started work by then, that would leave it only 12 months to get the project online before San Juan closes.

The website of the Yellowbud Solar Project, which has a capacity of 274 MW and construction cost that FirmoGraphs estimates to be $282.5 million, says its anticipated commercial operation date is the end of next year. In late July, its developer, National Grid Renewables, and construction contractor Kiewit Corporation made a Road Use Maintenance Agreement with the Ross County Engineer’s Office for the project, which is being developed in Ohio’s Ross and Pickaway counties. That would give National Grid Renewables 17 months to meet its targeted in-service date for the project. Like Fox Squirrel Solar, although it’s in Ohio, it won’t be affected by the renewables law enacted earlier this summer.

Doing fine

Developers of the two remaining projects seem to have them solidly on track.

One, the Mustang Mile Solar Energy Facility, is a $262 million, 150 MW project that Invenergy is developing in Macon Township, Michigan. In testimony that Invenergy submitted to the Macon Township Planning Commission in January, the company said it expected the project would be operational by the end of next year. That seems doable thanks to two big approvals the project received in May. One was from the Macon Township Board, which granted a special land-use permit for it and the other was from the Michigan Public Service Commission, which approved Consumers Energy’s plan to purchase it once it begins commercial operations.

The other project that seems to be humming along is the $250 million, 200 MW Grant County Solar Project, which NextEra Energy Resources has proposed building in Potosi, Wisconsin. In the application for the project that it filed with the Public Service Commission of Wisconsin in May of last year, NextEra proposed starting construction on the project in October 2021. Alliant Energy, which in April 2021 got permission from the PSC to buy the project, says on its webpage for the project that it expects construction on it to begin in spring 2022. Both NextEra and Alliant estimate that the project will be done in the fourth quarter of 2023, which seems attainable as NextEra got permission to build the project from the PSC a week after Alliant got permission to buy it.

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