2017-10-26 / Front Page

Solar firm tempts county landowners

Orchards to solar farms?
By Patti Brandt Burgess
Of The Enterprise staff

NORTHPORT ENERGY, a group of renewable energy advocates, recently completed the installation of educational signs at four wind and solar energy sites.NORTHPORT ENERGY, a group of renewable energy advocates, recently completed the installation of educational signs at four wind and solar energy sites.An out-of-state company has contacted several Leelanau County property owners, offering to lease their land for $800 per acre for use as solar farms.

Leland Township resident Bruce Price, who has 72 acres on Eagle Highway and Co. Rd. 641, got a packet of information in the mail from Cypress Creek Renewables, a company that has put up several solar farms across the country.

The company has offices in North Carolina, California and Arizona.

Price said he is giving the company’s offer serious consideration.

“I think solar is the way to go,” Price said. “I think it’s a fishing expedition that could happen.”

But one local installer of solar systems said a landowner can make more than five times that amount by putting up their own solar array.

“The $800 is really, really low,” said Tom Gallery, owner of Leelanau Solar. “It looks really attractive to someone who’s getting $200 per year renting their land to someone who’s doing row crops.”

And with Cherryland Electric Cooperative paying 10 cents per kWh in its Buy-All/Sell-All program created last year, putting in a solar farm is a good investment, Gallery said.

Under that program, sponsored by Cherryland’s power supplier, Wolverine Power, Cherryland members can sign a contract guaranteeing pricing solar-produced electricity for 20 years.

After 20 years they will have the option to renegotiate their contract at current prices, said Rachel Johnson, member relations manager for Cherryland Electric.

Solar panels generally last about 20 to 25 years and may be at the end of their productive life when the initial contract expires, Johnson said.

Johnson said she has learned from Cherryland members that Cypress Creek has contacted several of them in Leelanau County.

The firm’s goal, she said, is likely to put together geographical regions for solar farms located close to an electric substation. Cherryland has a substation located on Eagle Highway near the intersection of Co. Rd. 641.

Casey May, director of market development for the Michigan region for Cypress Creek, said the company has development activities in 14 states.

The company has recently made forays into Michigan because research shows a demand for additional power generation in the state, May said. There are also several coal-generated facilities that are scheduled to go off-line in the coming years, he said.

“We believe there are opportunities to construct multiple projects there and we’re looking throughout the region,” May said.

The company is very early in its development process and May said it’s too early to forecast the number of solar farms targeted for the area.

Cedar cherry farmer Glenn LaCross said he received a letter from Cypress Creek, but hasn’t had time to look into the company’s proposition.

A believer in solar energy, LaCross thinks it may be a good idea.

“I think there’s a lot of people in Leelanau County that really want sustainable energy,” LaCross said. “There’s a lot of sun out there to harvest.”

When asked if an abundance of solar farms would change the landscape of the county, LaCross said “no.”

“We don’t want windmills in Leelanau County,” he said. “We can’t have our cake and eat it, too. We’ve got to give up something.”

Johnson said the company’s offer may very well be a good deal for Cherryland members.

“What I’ve been encouraging members to do is contact a lawyer to work through contract issues just to make sure their interests are protected,” Johnson said.

She said that once Cypress Creek secures land they also have to secure a buyer for the electricity they will to produce. And Wolverine Power is always looking for electric suppliers, she said.

Price’s letter details how Cypress Creek is looking for a minimum of 20 acres and a willingness to lease the property for at least 20 years. In return, the company will pay $800 per acre, per year. Over 20 years that would add up to $320,000.

May said in this region the company is looking to build projects that would generate about 2 megawatts of power. Those smaller sized projects are typically located on about 20 acres of land.

According to the company’s website, Cypress Creek currently has several solar farms across the country that produce from two to 20 megawatts on average. The company sells the electricity the farms produce back to local communities, typically at rates lower than those for fossil fuels.

Most of the company’s solar farms are located in North Carolina, with just one in Michigan, in Wayne County.

Gallery, whose company installs solar energy systems, is skeptical. The payback on a solar farm is five to seven years, he said, and after that there’s a 12 percent to 15 percent return on investment.

To give an example of that return, Gallery said his company is currently building an 85 kWh solar farm south of Traverse City. The cost of the project, which is located on about a half acre, is about $142,000.

But after a $20,000 grant from the U.S. Department of Agriculture, a 30 percent federal tax credit, a $9,000 rebate from Cherryland plus an accelerated depreciation schedule, the cost of the project drops to about $70,000, Gallery said.

Grant and rebate amounts vary based on the size of the project; Cherryland’s rebate program pays up to $15,000.

The income from a solar farm that size is projected at about $11,300 per year, Gallery said.

That means that after five or six years the project will have paid itself off, with all of the income going into the landowner’s pockets, he said.

“On a larger scale it is very, very lucrative,” Gallery said. “If you want to just step back and get $800 per acre ... that’s just ridiculous.”

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