Pennsylvanias Dawning Solar Industry: What Every Developer Should - - PowerPoint PPT Presentation

Jon Beckman 814-333-4913 Gillian Flick 724-749-3187 Braden Christopher 724-749-3181

Pennsylvania’s Dawning Solar Industry: What Every Developer Should Know November 3, 2020

The Ins and Outs Behind Pennsylvania’s Solar Future Plan

Pennsylvania’s Solar Future Plan

Available at:

https://www.dep.pa.gov/Business/Energy/ OfficeofPollutionPrevention/SolarFuture/Pa ges/Pennsylvania's-Solar-Future-Plan.aspx

Existing Solar Assets

• Resource potential
• Abundant land
• Geographic location
• Grid readiness
• Competitive prices
• Interested project developers

The Plan for 2030

• Solar A Model

– 11 GW total – 3.9 GW (35%) Distributed capacity – 7.1 GW (65%) Grid scale capacity – Economic Cost: $513 Million net annual – Land Use: 89 square miles (56,800 acres) – Jobs: 100,000

• Solar B Model

– 11 GW total – 1.1 GW (10%) Distributed capacity – 9.9 GW (90%) Grid scale capacity – Economic Cost: $613 Million net annual – Land Use: 124 square miles (79,200 acres) – Jobs: 60,000

Grid Scale Strategies

• Long Term Contracts – Develop guidelines for limited use of

long-term contracts (LTCs) for a period of 10 or more years to ensure Pennsylvania benefits from grid scale solar energy

• Long Term Contracts – Evaluate and consider utility ownership
• f solar generation especially in cases where market-driven

deployment may be insufficient to achieve public goals and/or reliability concerns

• Grid Modernization – Investigate opportunities to grid

modernization to enable increased solar generation

Distributed Generation Strategies

• Virtual Net Metering – Expand customers’ ability to use net

metering

• Community Solar – Identify and remove the barriers to the

deployment of community solar systems in Pennsylvania

• Alternative Ratemaking – Ensure alternative ratemaking is

addressed in a manner that does not create a disincentive for solar development

• Property Assessed Clean Energy (PACE) – Enable and encourage

municipalities to offer PACE programs that include solar projects

• Addressing Interconnection Issues – Accelerate use of smart

inverters to manage over-voltage concerns on low voltage distribution lines and avoid unnecessarily adding costs on small solar distributed generation projects

Cross-Cutting Strategies

• Alternative Energy Portfolio Standards – Increase the AEPS

solar photovoltaic (PV) carve-out to between 4 and 8 percent by 2030 and ensure creditable Solar Renewable Energy Credits are limited to those generated in Pennsylvania wherever possible

• Access to Capital – Increase access to capital by expanding

availability of solar lending products to residential and commercial projects to enable solar ownership

• Access to Capital – Provide loan guarantees to lower interest

rates and incentivize deployment of solar generation

• Carbon Pricing – Implement a carbon pricing program and

invest the proceed in renewable energy and energy efficiency measures

Cross-Cutting Strategies

• Siting and Land Use – Support the creation and adoption of

uniform policies to streamline siting and land-use issues while encouraging conservation

• Tax Incentives – Evaluate the state of tax policy and consider

exemptions that encourage the development of solar PV systems

• Tax Incentives – Assist solar project sponsors in identifying

investors and/or companies that have sufficient tax equity appetite to take full advantage of the federal solar Investment Tax Credit and Modified Accelerated Cost Recovery System depreciation, if sponsors can't do so themselves

Project Development

• Three phases of project life

–Development phase –Construction phase –Operating phase

Project Development

• The development phase

–Greenfield (concept) stage –Mid-stage development –Late stage development

Greenfield Stage

• Feasibility (proof of concept)
• Interconnection studies
• Land availability and characteristics
• Permitting
• Taxation
• Community support

Mid-Stage Development

• Site control
• Engineering studies
• Environmental studies
• Site plan
• Interconnection agreement
• Real estate
• Permitting applications
• Local governmental relations

Late Stage Development

• Facility design
• Real estate
• Final reports
• Final preparations for earthwork and

construction

Siting and Permitting

• Location
• Land access
• Leasing/purchase
• Title ownership reports

Siting and Permitting

• Title Considerations

–Coal –Oil and Gas –Surface Rights –Easements

Siting and Permitting

• Review state and local laws
• Environmental review
• Transmission siting and

interconnection

Land Use

• Municipalities Planning Code
• Uniform Construction Code
• Pennsylvania Sewage Facilities Planning

Act

• Pennsylvania Storm Water Management

Act

• Pennsylvania Flood Plain Management Act

Land Use

• Planning commission
• Comprehensive plan
• Subdivision and land development
• rdinance
• Zoning ordinance

Real Estate – Land Title

• Considerations

– Severed coal, oil, gas and mineral (“COGM”) estate

• wnership

– Reservations of rights in COGM – Oil and gas operations began in 1859 in Pennsylvania – Commercial coal fields cover portions of Pennsylvania – COGM owners and surface owners may have conflicting rights to use the real property

Real Estate – Land Title

• Possible Actions

– Obtain or certify legal status of ownership (including COGM rights) – Obtain Title Insurance – Review federal and state law for provisions affecting

• wnership

– Negotiated lease provisions – Non-disturbance agreements – Purchase severed interests – Obtain surface use waivers – Obtain insurance on the improvements (facilities)

Real Estate – Land Title

• Title Insurance

– ALTA 35.3-06 Endorsement – Provides coverage against enforced removal or alteration of existing and planned future improvements due to the exercise by a COGM estate owner of the right to use the surface of the property to extract COGM – Relevant considerations to be satisfied before issuance (representative example):

• Detailed plans demonstrating the future improvements
• Title search back to 1859
• Title search of severed COGM estates
• Possible investigation beyond record title

Steptoe & Johnson PLLC

• Alternative and Renewable Energy Team

– Our attorneys assist with project development, site acquisition, financing, permitting, compliance, and negotiation of power purchase and other commercial agreements. Team members also advise clients on renewable energy credits, tax incentives, and energy efficiency and savings. – Our firm has title insurance agents, abstracting and land services in-house – Colorado, Kentucky, Ohio, Pennsylvania, Texas and West Virginia – https://www.steptoe-johnson.com/services/alternative- renewable-energy

QUESTIONS?

Jon Beckman 814-333-4913 jon.beckman@steptoe- johnson.com Gillian Flick 724-749-3187 gillian.flick@steptoe- johnson.com Braden Christopher 724-749-3181 braden.christopher@steptoe- johnson.com

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