City Utilities near deal for biggest 'solar farm' in Missouri
With the cost of producing solar energy dropping and environmental regulations on the horizon, City Utilities has reached an agreement on the construction of the state’s largest solar farm.
“It brings some balance to the (energy) portfolio, and prices have dropped to the point that it makes sense,” said Steve Stodden, assistant general manager of electric supply for CU. “It made sense before, but the price was astonishingly high.”
The utility company is expected to finalize a contract today with Solexus Development, out of St. Louis, and Strata Solar, out of North Carolina. Construction is expected to begin in the spring of 2014. Until the final contract is executed, CU’s spending on the project will not be revealed, utility officials said.
The agreement is for Solexus to develop the project and for Strata Solar to construct, finance and operate the 4.95-megawatt system. The agreement covers 25 years, over which time the system is expected to produce about 9.6 million kilowatt hours per year — enough to power about 875 homes in Springfield.
The Bladenboro Solar Farm is a 6.5 megawatt system, a little larger than the one planned for Springfield, which was also built by Strata Solar. / Courtesy of Strata Solar
The nation’s largest solar station is the Agua Caliente Solar Project in Arizona, which is roughly 50 times larger than the planned CU station.
City Utilities’ responsibility will be to provide equipment to connect the system to existing infrastructure. It would then buy the solar power that Strata Solar produces, Stodden said.
Cara Shaefer, director of energy management and conservation for CU, said the development won’t have much of an impact on customers’ bills because City Utilities is responsible for almost none of the up-front cost, and the energy produced will be mixed in with existing energy sources.
Shaefer said City Utilities was approached by a vendor last fall seeking to enter into a purchase-power agreement. After a year of developing a request for proposal and seeking those proposals, City Utilities selected Solexus and Strata Solar over three others.
The system will be built on a 57-acre plot of land immediately east of City Utilities’ McCartney Generation Station on Farm Road 119. Officials said they expected the system to take up approximately 40 acres of the land, mostly with large solar panels.
It will occupy what is currently a buffer zone between McCartney Generation Station and private land.
“There’s no noise, and nothing’s going to be developed on it for 25 years,” Stodden said. “It’s a good neighbor.”
Stodden said a benefit of the solar plant will be that it provides on-peak power when electricity is most in demand.
David Bunge, president of Solexus Development, said solar stations are growing in popularity mostly because they are cost-effective.
“It’s always had advantages,” he said. “It produces clean power, you don’t have fuel you have to worry about, and it gives you that constant predictability — the sun’s always going to come up.
“But historically, it has been somewhat cost-prohibitive because the technology hadn’t really reached scale.”
He said that’s changed over the past two to three years, as incentives, particularly in Europe, have led to increased demand for solar energy.
“As they’ve become more popular, utilities have learned about additional advantages,” Bunge said. “Solar tends to generate right at peak times, helps manage peak loads, and it has benefits to reducing wear and tear on the grid. That makes it more attractive.”
Ozarks resident Jim Evans, a challenger to Rep. Billy Long in the 2012 election, has used solar energy at his home — from a set of 140 panels on a 16-by-93-foot structure — for the past three years, and he said he’s pleased to see City Utilities taking this step.
“I think it’s an important step as far as the utility company is concerned, absolutely,” he said.
He said as the demand for coal falls, the cost of operating a coal plant has continued to rise.
“You don’t have to abandon coal,” he said. “If you’re offsetting with solar, wind, nuclear and hydro, you can cut back on the amount of coal you’re using and it gives the environment more time to adjust.”
Lev Guter, a local representative with Sierra Club, said the organization is also glad to hear City Utilities is moving forward with solar energy.
“Renewables like wind and solar are absolutely necessary to make sure our electricity needs are met,” he said. “Any opportunity that’s available to be able to utilize our renewable resources to provide energy, we have to make sure those steps are taken.”
Stodden said the development of a solar plant will also allow City Utilities to learn more about an operation which could become a much bigger part of the company’s energy portfolio in coming years.
City Utilities is already spending money on its power stations to comply with environmental regulations, and more could be on the way, Stodden said. In future scenarios in which carbon emissions are more regulated, renewable energy sources like solar power become more important.
The contract stipulates that City Utilities will retain all Renewable Energy Credits associated with the generation. A Renewable Energy Credit is a commodity that can be traded and represents energy generated from a renewable source — a valuable asset for utilities that are subject to certain guidelines.
The state set a Renewable Portfolio Standard in 2008 that mandates investor-owned utilities have 15 percent of their energy from renewable sources, but that doesn’t apply to municipal or cooperative utilities like CU, which is owned by the City of Springfield.
“We do continue to research and utilize renewable resources when possible,” CU spokesman Joel Alexander said.
Bunge said, in general, environmental regulations have played a role in the increasing popularity of solar power.
“We’ve kind of started to reach a tipping point where a lot of these factors are coming together that makes solar a nice fit for utility companies,” he said. “Certainly there are some regulatory concerns that I think utility companies are wary of.
“For a number of reasons, their portfolios are not going to look the same 5-10 years from now. Since solar kind of fits that niche really well, as a zero-carbon solution at a cost that is becoming increasingly competitive, it makes a lot of sense.”
