Follow a trail of deeds piling up in courthouses across Pennsylvania and you might conclude that there is something big on the horizon for solar energy in the Keystone state.
Since the beginning of the year, solar developers have tied up hundreds of acres — some signing long-term leases but more often securing the option to lease the land in the future.
“There’s a lot of prospecting going on,” said Sharon Pillar, a clean energy consultant and director of the Pennsylvania Solar Center, a Hill District-based nonprofit that helps organizations go solar.
To Ms. Pillar, it makes perfect sense. Pennsylvania has a lot of land and not a lot of solar energy. Most of the 400 or so megawatts of capacity installed in the state sits on top of peoples’ rooftops or on their farms. It’s small-scale, residential projects, not the sprawling solar farms common in sunnier states.
But there are big names with deep pockets quietly marking territory across Pennsylvania.
LendLease Energy Development, an arm of the international real estate firm LendLease Corp, is designing a 20-megawatt solar farm in Beaver County, on the border of Findlay Township. The 161-acre project is called Gaucho Solar.
Earlier this year, LendLease signed lease option agreements in Bradford, Potter and Lawrence counties.
Dakota Power Partners, a Colorado-based firm that plans to build an 80-megawatt solar farm in York County at an estimated cost of $75 million, has also signed option agreements with landowners in Lebanon, Northampton and Blair counties over the past few months.
Minnesota-based Geronimo Energy LLC signed a lease agreement for 77 acres in Northumberland County.
Walden Renewables, a developer out of New Hampshire, may have the biggest designs of them all.
The company is building a 90-megawatt wind farm in Potter County and has recently leased nearly 400 acres nearby for a solar farm. Its plans are to build a 183-megawatt solar plant there, according to documents filed with PJM Interconnection, the Valley Forge-based grid operator that guides the flow of electricity in 13 states, including Pennsylvania.
Facilities that want to feed into that power grid have to let PJM know of their plans to ensure all the necessary infrastructure is in place.
Many file plans that never materialize and that is sure to be the case with a large portion of the 4,496 megawatts of solar currently in the interconnection queue in Pennsylvania.
For perspective, the Beaver Valley nuclear plant in Shippingport has a capacity of 1,872 megawatts.
Tying up land with an option agreement is the first and least expensive step among many, said Andy Redinger, manager director who heads up the utility, power, and renewable energy group at KeyBanc. It makes sense to give a little bit of money at a landowner while the developer works to line up financing and a customer to commit to buying the solar power through a long-term supply agreement, he said.
Not if but when
The land leasing wave came on the radar of Ed Johnstonbaugh within the past few months.
As an energy educator and consultant to rural landowners through Penn State Extension, Westmoreland, Mr. Johnstonbaugh said he’s hearing echoes of the oil and gas rush a decade ago.
“This occurred with the Marcellus Shale efforts where speculators came in and tried to lock up territory and hope they hit an area of interest,” he said. That acreage could then be flipped to a developer.
One landowner even told Mr. Johnstonbaugh that the same landman who came around pitching a shale drilling lease years ago returned recently to hawk a solar lease.
“They can make it sound pretty sweet for someone sitting there on a rocking chair on their porch with land that’s not doing anything,” Mr. Johnstonbaugh said.
The agreements follow a similar pattern: They generally give the developer a few years to decide whether to execute a lease, another several years to build the facility and then about 30 years to operate it, with the potential to renew. The companies are looking for flat land close to transmission lines.
Penn State itself has partnered with Lightsource BP, an infrastructure fund financed by BP Corp., to build a 70-megawatt solar farm in Franklin County.
The lease documents in the public domain suggest that many companies aren’t ready to pull the trigger yet — hence the option agreement.
Waiting on Harrisburg
One theory is that developers are banking on solar-friendly movement in Harrisburg.
Over the past decade, Pennsylvania has gone from being one of the leading states in renewable energy legislation — it had enacted a law that mandated a certain percentage of a utility’s electricity had to come from solar — to lagging behind as other states adopted more aggressive targets.
Today, utilities here are required to fill a quarter of 1% of their electric demand with solar energy. But recently introduced legislation would, if successful, raise that quota to 10% by 2030.
The Pennsylvania Department of Environmental Protection estimates that’s well within the realm of possibility — in fact, it’s part of Pennsylvania’s suite of recommendations for tackling climate change. The ramp-up in solar capacity would mostly come from so-called grid-scale solar development.
Consider what that would mean for Downtown-based Duquesne Light, which has 23 megawatts of mostly rooftop residential solar panels connected to its distribution grid. That’s about 1% of its peak demand, according to spokeswoman Jessica Rock. Getting that to 10% would require multiple large-scale solar developments.
Geronimo Solar spokeswoman Lindsay Smith said the company already has 300 megawatts of projects in development in Pennsylvania but that “the prospect of the state increasing its goal for the Alternative Energy Portfolio Standard made the market increasingly attractive.”
“They are waiting for the legislation,” Ms. Pillar said, but there are other factors colliding as well.
The cost of solar panels and equipment has continued to fall in recent years. At the same time, the federal investment tax credit for renewable energy is being phased out, sending developers scurrying to qualify projects before the credit sets, she said.
Pennsylvania government officials seem to welcome the idea of large-scale solar, especially on brownfields that the state is desperate to redevelop, Ms. Pillar said.
Prospecting, even in Pittsburgh area
Mr. Redinger, who has been saying for years that there is no shortage of capital looking to finance these projects, said solar-friendly legislation would act as an accelerant, not a game changer.
“This is no longer an industry in its infancy; it’s matured,” he said. “It’s now a mainstream space for banks to finance.”
While a lot of the prospecting is happening in central Pennsylvania, developers have also poked around in the flatter parts north of Pittsburgh, she said.
Those places might be a good fit for smaller, community solar projects, she said. That’s another category of solar development waiting for a Hail Mary from Harrisburg that would enable residents without roof space or land to install their own panels to instead buy shares in a community solar farm.
Greg Winks, who owns solar consulting firm Solbridge Energy Advisors in Pittsburgh and who has been approached to scope out land for solar developers, said that even if only a fraction of the interest materializes into actual solar power, it’s still putting Pennsylvania on the map.
“Just the fact that they’re even looking to temporarily tie up land is a very positive thing,” Mr. Winks said.