Sol Orchard installed this one-megawatt solar panel project for California’s Victor Valley College.
Imagine a crop without worries of labor, pests, rain during harvest, and rising fertilizer costs. In the near future, there’s potential for such a crop, and it’s one that most growers could produce with little impact on their current horticultural practices and commodities. By farming the sun, growers may soon produce and sell electricity to utility companies.
Nearly every grower has a corner or piece of ground with poor soil, poor drainage, a rock bar, or something that’s wrong with it, said Jeff Brothers, president of Sol Orchard, a private company concentrating in solar, photovoltaic power projects. “I predict that in the future, farmers around the country will install solar ranches, punch into the grid, and farm the sun. It will be a great use of poor soil and a way to augment their income,” he said in a telephone interview from his office in Carmel, California. “Farmers are historically conservationists at heart. This is one way to produce a crop that’s good for the country.”
Brothers, who spent more than two decades in California’s cut flower industry as a grower, changed careers several years ago to be involved with renewable energy. He is still involved with agriculture, but his focus now is to help growers append solar power production into their normal farming activities. Sol Orchard specializes in solar power projects that are at least one megawatt in size and works with private, public, and nonprofit entities that have at least five acres of land available.
These days, solar PV panels can be located just about anywhere. If land is available, terrestrial mounting is usually more economical than placement on rooftops because maintenance is easier. Moreover, new technology allows some panels to rotate and track the sun, and, some even float. The Far Niente winery in Napa, California, is using floatable PV panels in their wastewater pond, serving a dual purpose of producing electricity and reducing evaporation in their pond water.
Though there is usually plenty of land available in most of the western states, Brothers is not in favor of taking prime agricultural land out of production for a solar farm. “I prefer it to be on unproductive land, not prime farmland.”
Offset current usage
Brothers explains that in the short term, state and federal governments are using a variety of incentives, including cash grants in lieu of investment tax credits and performance-based incentives and loans, to encourage agriculture and commercial businesses to produce renewable energy to offset their current load or usage. Most programs tend to not pay producers for more than their current usage.
For example, in California, the renewable energy buyback is capped at one megawatt of electricity load. (One megawatt of electricity will power between 250 and 500 homes annually.)
He noted that the average agricultural processing plant in California uses between one and two megawatts of electricity per year.
Sol Orchard is near completion of a one-megawatt project for Nichols Farms, a pistachio grower and processor in Hanford, California. Nichols Farms’s solar orchard is located behind its processing plant because utility regulations require that the renewable energy be plugged into the meter that the energy will offset. Brothers said that Chuck Nichols, president, wanted to save money by offsetting their power use as well as lock in a fixed electricity rate for the future. California utilities have been averaging a 5 percent rate increase each year. “Chuck was concerned about the rising utility costs and wanted to hedge his costs with a fixed rate. By offsetting his power with solar, he now knows what that cost is.”
Farmers often have attractive electricity rates for things like irrigation water pumping that are lower than commercial rates, Brothers said. However, if they have a packing plant, the plant often doesn’t benefit from the agricultural rate.
In the past, solar energy projects typically didn’t make economic sense if the electricity rate paid was less than about 6 cents per kilowatt. Today, with so many individual states and utilities offering unique rebates and programs, it comes down to the individual situation and should be considered case by case. “In a lot of cases, it does work and can be attractive, especially with the different financing options,” said Brothers.
Growers interested in producing renewable energy should first know what their electricity usage is, peaks and valleys of usage, and investigate programs offered by their local utility.
A variety of financing options are available for solar orchard producers, ranging from a simple lease arrangement to full ownership. Lease options can be a way for someone who wants to install a project but may not have extra cash lying around. With a ten-year lease option, the lessee pays the same amount he or she would pay each year for electricity. At the end of the ten years, they have a lease renewal or purchase option.
Brothers believes that feed-in tariff policies, which have resulted in Germany becoming the number-one solar energy producing country, will eventually be implemented in the United States. Once that happens, renewable energy programs will be predictable and profitable, he said.
A feed-in tariff is a governmental policy implemented at the local, state, or federal level to spur the development of renewable energy projects. The program consists of a fixed price, long-term contract that utilities pay to electricity generators for the total amount of renewable energy they produce, not just to offset current use. By using a standard energy contract, the utility must pay a predetermined rate or tariff for any project that meets the criteria for the energy type. Prices for each type of energy (solar, wind, biomass, and such) are set by government agencies and locked in for the life of the contract.
“The utility has to take the renewable power at a fixed price and you’re not renegotiating a brand-new price every time you show up at a utility,” Brothers said, adding that industry can then plan and obtain financing.