Robeson county officals, college representatives and businesses meeting Wednesday to discuss solar industry
By John Ramsey
FAIRMONT – For decades, farmers have planted tobacco, soybeans, cotton and corn in a 100-acre field a stone's throw from the town's only high school.
This year's harvest will be sunlight.
Joel Olsen is managing director of O2 Energies, a solar installation company. He stood recently with town leaders and a few curious residents at the edge of the empty field, one of his shiny silver solar panels propped against a Mercury sedan.
In six months, nearly 18,000 solar panels will dot the field, enough to power 700 homes, Olsen told the gathering.
Government subsidies for clean energy and sharp declines in solar panel prices have spurred the solar farm business to expand rapidly in North Carolina, following a nationwide trend.
Perhaps nowhere in the state is there more evidence of the industry's growth than in Robeson County, where O2 Energies is one of multiple companies building large-scale solar farms.
Combined, the farms in or just outside Robeson County are expected to generate up to 37 megawatts of photovoltaic solar power, or enough to power about 7,400 homes. That's more than the number installed across all of North Carolina in 2010.
O2 Energies has another 4.5-megawatt farm going up in Maxton. Strata Solar has two 6.4-megawatt farms under construction near Maxton and Rowland and plans to build two more. And just a few miles over the Robeson County line, on U.S. 74 in Laurinburg, a 2.4-megawatt farm is nearly finished.
“It's kind of crazy, the amount of activity right now,” said Ryan Nance, energy sector project coordinator for Lumber River Workforce Development. “There's probably half a dozen solar developers, and they're confident they're going to be building projects this year.”
Nance said there's talk of even bigger projects coming to the area, but he is not yet allowed to discuss them.
Brian Bednar, president and owner of Charlotte-based Birdseye Renewable Energy, is as responsible for the Robeson County boom as anyone.
Bednar scouts locations for new projects, handles negotiations with landowners and secures permits from cities and counties. He matches investors with developers who install the farms.
Bednar and others in the industry say the region of Robeson, Scotland and Hoke counties has many advantages that make solar farms attractive:
It's big, with lots of open land and sandy soil that isn't best suited for farming.
It's flat, which makes installation of rows of panels cheaper and easier to install on a large scale because the land doesn't require much grading.
It has electric infrastructure that makes it simpler and cheaper to hook the panels into the Progress Energy grid.
It has a growing number of workers trained in installing solar farms.
“But beyond that, we've found a welcoming environment to try to do business,” said Bednar, who expects continued growth in Robeson County in the next five years. “I think at this point (solar energy is) still somewhat of a novelty. It won't be a novelty in Robeson County.”
The county's unemployment rate is 12th-highest in the state at 12.9 percent. Officials are trying to establish the area as a niche market for the sunshine business.
A job fair in March with Lumber River Workforce Development drew 130 people; 43 received job offers for work paying $10 to $13 an hour.
Robeson Community College has started offering courses in solar panel installation. The idea is that trained workers will be able to work for months at a time on one solar farm, then use that experience to work on more projects in the future.
Fifty-two people have been through the three-day course. Some of them had not sat in a class since dropping out of high school 30 years ago, Nance said.
Robeson Community College is developing an area on its main campus dedicated to sustainable agriculture and renewable energy called the Green Zone. By the end of the month, the land will have 18 solar modules in place so students can receive hands-on training. The modules were donated by Strata.
Dupont is donating solar panels that contain its protective Tedlar material. Those will be installed on a rooftop to mirror smaller solar projects.
Nance said the college also hopes to install solar thermal panels, like the ones at a turkey plant in St. Pauls that heat about 100,000 gallons of water a day.
“It's really going to be impressive when it's all said and done,” he said.
Teachers at Fairmont High School plan to use the new solar farm in town for science lessons.
“We think it being beside a high school will provide a unique opportunity for the science teachers to actually show the students what the future of energy generation might look like,” Olsen said.
Solar manufacturing in the U.S. has taken a beating recently, most publicly with the September bankruptcy of California-based Solyndra. The solar-panel company went bankrupt last year after receiving $535 million of loan guarantees from the administration.
One reason was that China poured an estimated $30 billion into its solar industry, leading to steep reductions in the price of panels. U.S. manufacturers complained that this made Chinese panels artificially cheap.
The U.S. Commerce Department recently imposed new import fees on Chinese solar panels because of the subsidies, but the decision won't significantly raise solar prices in the U.S.
The cost of silicone also plummeted.
The dip in panel prices – 40 percent from the fourth quarter of 2010 to the same quarter last year – has been terrible for the U.S. companies trying to make and sell panels.
But for the companies buying panels to install solar farms, it has moved the industry years ahead of where experts expected it to be.
The U.S. saw 1,855 megawatts of solar power installed in 2011, a 109 percent jump from the year before.
The growth also has translated into big business for companies that create components that go into solar panels, such as Dupont.
Many states, including North Carolina, have incentive packages to encourage renewable energy.
The state offers a 35 percent investment tax credit worth up to $2.5 million through 2015 and a property tax exemption of 80 percent. There's also a 30 percent federal investment tax credit.
North Carolina requires utilities to generate at least 12.5 percent of all retail electric sales from renewable energy by 2021, including at least 0.2 percent from solar energy.
Monique Hanis, spokeswoman for the Solar Energy Industries Association in Washington, said most of the industry's growth has taken place in states with strong incentives and policies. North Carolina ranked eighth in the nation for solar installations last year.
Progress Energy spokesman Scott Sutton said the utility is focused more on other, cheaper renewable energy sources to meet its requirement for clean energy because it has already met its solar requirement. It's still cheaper to make energy by using biomass from landfills, he said. And those sources are available all the time, not just when the sun is shining. One megawatt of capacity in other sources will typically power 750 to 1,000 homes. The same capacity in a solar system will power about 200 homes because it only works when there's sunlight.
Still, the number of solar companies in North Carolina has jumped from about five to more than two dozen since 2009.
“Since we started taking solar seriously a couple of years ago, we have seen a dramatic increase in players in the solar industry and a decrease in the price of solar,” Sutton said. “The million-dollar question is at what point does solar energy become cost-competitive?”
Experts say soon, if not now.
A report released Feb. 29 by the N.C. Sustainable Energy Association said large solar farms – those capable of producing 500 kilowatts or more, or about a 10th the size of most of the Robeson projects – will be cost-competitive with all North Carolina utilities by 2015, taking into account the trend of dropping solar prices and rising electricity rates. By 2020, the report states, solar will be competitive even without federal and state tax credits.
Recently, companies have come up with more cost-efficient ways to build large-scale farms and more complex financial models that bring the cost of solar energy close to the cost of producing electricity with fossil fuels.
State rules require utilities to buy energy from any company that can sell it at a lower price than the utility is already paying for production. Sutton said a few solar companies have approached Progress Energy with such offers. Those companies would sell the electricity to Progress Energy, then sell their renewable energy credits – think carbon offsets – on the open market.
Solar companies keep a tight lid on their financial models. But without being competitive against traditional sources of energy, the market for solar power would have topped out when utility companies fulfilled their requirement for buying solar.
“We approach this as we're not in the renewables business, we're in the energy business” said Blair Schooff, vice president of marketing for Strata Solar. “We need to be in that same strike zone, and I think we are there. We're very close to being there.”
Michael Cohen, Strata's vice president of business development, said risks are associated with solar development, as with any other enterprise.
The biggest ones are uncertainties with the regulatory landscape and incentives.
“We are so much smaller than other industry that we're much more susceptible to those waves.” Cohen said. “The economy as a whole is a concern, because that affects the appetite of investors.”
Local leaders have high hopes for the silver fields sprouting across Robeson County.
Fairmont Mayor Charles Kemp's optimism was obvious as he stood beside Olsen and that shiny panel.
“Through the '50s, we were the smallest little tobacco market in the world. We've just kind of been foundering since,” Kemp said. “But we're making a comeback.”