Sun farms sprout in N. Carolina

Landowners see profit as incentives draw solar companies

— Just off a country road is a sight few people ever imagined in this corner of southeastern North Carolina.

Solar panels cover a 35-acre field that once produced corn, tobacco and other crops. When the sun shines, the panels generate enough electricity for hundreds of homes.

“I initially thought this was a pipe dream,” said farmer Billy Dean Hunt, recalling discussions with a solar company about using his cornfield for a sun farm. “But I started talking to them. They convinced me they would honor what they said. So I did it.”

The scene near Rowland is found increasingly across North Carolina. Solar farms dot the landscape from the Blue Ridge mountains to the sandy coastal plain - the result of an emerging renewable-energy industry.

In many cases, solar farms are replacing cropland that doesn’t generate enough income from traditional farming. Other times, solar farms are being placed on vacant industrial sites or land that hasn’t grown crops in years.

Unlike many other Southern states, North Carolina has encouraged the development of solar power through generous tax incentives and a state law requiring electric utilities to use some renewable energy. These policies are a key reason North Carolina often rates high in national rankings of solar-friendly states - and why solar farms are growing steadily.

“This shows we are progressive,” said Laurinburg, N.C., Mayor Thomas Parker, whose community has a solar farm similar to the ones in nearby Rowland. “Anytime we can add a dollar to the tax base, we are interested. I believe in it. I think this will be more prevalent in the future.”

Since 2007, when North Carolina began requiring power companies to use renewable energy, about 100 solar farms have registered to open, according to the N.C. Sustainable Energy Association, a group that tracks the sun business.

Some of those may not have cranked up yet, but the association says the number of companies registering with the state gives an indication of the interest. Before the law passed five years ago, North Carolina didn’t have any solar farms, the association reports.

The increase in solar farms reflects a larger trend in North Carolina, where investor-owned utilities must provide up to 12.5 percent of their power from renewable sources.

North Carolina’s renewable and energy efficiency industry employs more than 15,000 people and has generated some $3.7 billion in gross revenue this year, the association says. Companies providing solar services have increased 76 percent since the renewable energy requirement passed the state’s Legislature five years ago, according to surveys by the Sustainable Energy Association.

The business has detractors, including some lawmakers.

State Rep. Mike Hager, a Republican, said it’s a mistake to dangle tax incentives, which drain state revenue, for an industry that he contends would not be competitive otherwise. He and others question whether North Carolina is gaining any real economic benefit since solar farms don’t produce many jobs after the initial construction phase.

“I think this has set the wrong precedent,” said Hager, a former Duke Energy employee. “You take taxpayer dollars and prop up an industry that can’t survive on its own. Why do we do this? Why is it any better than any of the other ones?”

The idea behind North Carolina’s solar effort is to diversify energy sources and stimulate the economy with a relatively new type of industry.

Unless new technology is developed, solar can’t replace traditional power sources because sunshine is required. But solar boosters say efforts like North Carolina’s can reduce dependence on coal and nuclear power and stabilize electric bills for customers. Coal and nuclear-power plants create toxic waste, and fuel supplies such as coal are subject to price variability.

Solar farms are large-scale projects intended to provide power for the electrical grid, which historically has relied almost entirely on coal, nuclear reactors, hydropower or natural gas. Solar farms provide far more energy than solar panels on homes, which also can feed power to the grid.

Solar farms periodically spark questions about whether they are appropriate in some communities. Some people say they are unsightly and take up too much space, while others question whether it’s a good idea to replace productive farmland with solar farms. In the deserts of the West, the impact on endangered species is a concern.

Conservative lawmakers also question the wisdom of adopting government policies to encourage an industry they say would have trouble surviving on its own.

Efforts are under way in North Carolina and, possibly at the federal level, to scale back incentives and requirements for renewable energy - although President Barack Obama’s re-election may reduce the chance of federal changes.

To Helen and Tom Livingston, solar farms are a great idea.

She and her younger brother decided this spring not to replant a 47-acre cotton field their family has owned for generations. For much of the next three decades, their family will be paid to rent the land to sun-power developer Strata Solar.

Details of the arrangement were not available, but Strata typically pays about $500 to $600 per acre annually. That would be more than $20,000 each year for the 47-acre plot in Robeson County, N.C.

“It is almost too good to pass up,” said Helen Livingston, 71. “For us, it wasn’t just the money. It was the excitement of having a solar farm.But I think people would see that it does pay more than farming.”

Hunt, the farmer from Rowland, said his reasons for leasing to a renewable-energy company were almost purely financial.

“It is guaranteed money,” said Hunt, 63, a Marine Corps veteran. “Farming is a risky business. If you can take some of the risk out and the liability, you are ahead of the ball game. If I die, my wife will have income because she couldn’t farm the land anymore.”

Business, Pages 23 on 11/12/2012

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