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March 18, 2024

Federal, state incentives drive solar farms to landfills, other brownfields

HBJ PHOTO | STEVE LASCHEVER Will Herchel is the CEO of West Hartford-based solar development firm Verogy, which will be building three Connecticut solar farms on landfills.
By Harriet Jones, Hartford Business Journal Contributor

West Hartford-based Verogy has struck deals to develop solar farms on three landfill sites in Connecticut, marking an increasing trend in such projects around the country.

New federal tax credits are combining with state incentives to make landfill solar — which is technically complex — more financially viable for developers. And there are other reasons why the trend is attractive.

“First, by generating renewable energy, these projects will significantly reduce carbon emissions, contributing to the fight against climate change,” said Will Herchel, CEO of Verogy. “Second, the use of capped landfills for the projects represents an important achievement in land reclamation and sustainability.”

Verogy’s declared projects are on municipal landfills in Deep River, Middletown and Montville, and the company says it’s in talks on four other similar Connecticut-based deals. In addition, the company is eyeing sites in Maine and Vermont, and will look to roll out landfill solar programs in other parts of the country where it’s active, including the mid-Atlantic, New Jersey and Pennsylvania.

Overall, in the decade since the first solar landfill project in Connecticut was developed in Hartford by the Materials Innovation and Recycling Authority (MIRA), nine utility-scale projects of 1 megawatt or more have been approved and a 10th is currently before the Siting Council. There are also numerous smaller municipal projects all around the state.

Brad Parsons

Brad Parsons, Verogy’s director of design and permitting, said New England in particular has opportunities for landfill solar development, because it has many older landfill sites that weren’t originally designed for a second reuse.

“Unlike some of the spots maybe in the Midwest, where they’d have some planned park developments or other type of reuse that’s designed into the actual cap and closure,” he said, “the New England municipal landfills were just capped with no potential reuse at the time considered. And so, that’s what kind of really opens them up for solar development.”

Costly construction

Building a solar installation is not a straightforward process however, because of the need to ensure that the landfill cap remains intact.

“We’re not able to go out there with our normal excavators or wheel loaders or anything like that to be able to move equipment around,” Parsons said. “We end up having to use smaller track-based equipment that has less pounds-per-square-foot impact.”

And what goes for the construction also applies to the solar equipment itself.

“The racking, which is what the solar panels or modules are attached to, is designed to have that same limited amount of pressure,” Parsons said. “So, instead of being a traditional ground mount where the foundation supports are driven into the ground, they are actually set on ballast blocks.”

All of that adds expense, which is where the incentive programs come in. The 2022 Inflation Reduction Act included a 10% investment tax credit for renewable energy programs constructed on brownfield sites. Combining other incentives for things like sites that benefit low-income communities could make the return even greater.

And the state of Connecticut is also pointing the way to these types of developments via its Non-Residential Solar Renewable Energy Solutions (NRES) and Shared Clean Energy Facilities (SCEF) programs, which now offer what’s known as a bid price preference of 20% on the electricity that will be generated for renewable energy programs sited on brownfields.

According to the state Department of Energy and Environmental Protection (DEEP), 14 projects totaling more than 17 megawatts of power have been sited on landfills as part of the NRES program. In addition, three solar projects on brownfields, totaling just under 9 megawatts of power, and four solar projects on landfills, totaling almost 8 megawatts, have been selected in the first four years of the SCEF program.

These are part of an effort to fulfill the state’s statutory mandates for a 100% zero-carbon electric sector by 2040, and economy-wide greenhouse gas emissions reduction of at least 80% below 2001 levels by 2050.

“The administration seeks to bring on significant solar capacity that is fairly and justly sited and preserves productive farmland and core forests,” said Paul Copleman, a spokesman for DEEP.

Attorney Lee Hoffman, at Pullman Comley, is one of the leading experts in these projects. He has been involved in six major landfill solar deals in Connecticut. Hoffman said in the past, the main consideration for siting solar projects was proximity to a substation, but over the years, the state has begun to weigh other siting issues more heavily.

“Solar uses a fair amount of land on a per-megawatt basis,” he said. “It takes far less land to burn fossil fuels than it does to run a solar project. However, there are no emissions coming from a solar project. So, in some ways, you’re trading land for zero-carbon effects.”

Growth roadblocks

But Connecticut, being a small, densely settled state, has limited open space for renewable projects. Policymakers have put brownfield incentives in place because of growing concerns about what has been dubbed energy sprawl — renewable projects being developed on forest and farmland, gobbling up property that could be productive for other purposes.

“It’s an excellent use of land,” Hoffman said of the trend toward landfill siting. “And since we’re concerned about land use in Connecticut, we don’t want to have projects that are going to adversely impact the spaces that we want to keep open.”

He describes Connecticut as one of the states that’s in the vanguard of this issue nationally, and said since the passage of the federal Inflation Reduction Act, he’s seeing a big uptick in interest from clients who want to know which potential projects might qualify for incentives.

The state’s bid price preference, combined with the federal incentive, can be a game-changer for an expensive landfill-based project to a developer like Verogy.

Brian Fitzgerald

“If we develop projects on an old farm field or an old tobacco field, for example, we’re not going to be eligible for that bid price preference,” said Brian Fitzgerald, Verogy’s director of development. “So, in order to help account for the additional construction cost of being on a landfill, you have the bid price preference, and you have that federal (Investment Tax Credit) to help level the playing field and make developing the landfill project equally as attractive, if not a little more so than developing that greenfield project.”

And it’s also what’s got municipalities excited about the prospect.

“A lot of the municipal landfills that we’re developing are participating in the (Non-Residential Solar Renewable Energy Solutions) program, and that program is effectively designed to push value back to the municipalities,” Fitzgerald said. “The municipalities we’re working with are either getting lease revenues for us being able to put the project on the landfill, or we’re sending them credits through the NRES program. Some towns want to realize the savings or economics in one of those two ways.”

But Fitzgerald also warns that there are natural roadblocks on the kind of growth we may see in the landfill trend.

“We build as much as we can, and so do other developers and other market participants,” he said. “But there simply are not enough landfills to put solar on, or wind, or any kind of other zero-carbon technology for the state to meet its zero-carbon goals. So, that’s why developers like us and others look elsewhere, other real estate.”

There are a finite number of landfills, and there are also some landfills that just aren’t feasible for solar because of steep terrain or a lack of nearby infrastructure.

“But we also do know that there are more landfills that are being created and capped,” Fitzgerald said. “I know of a couple in Connecticut that will enter the active capping process this year or next. So, while there might not be a hockey-stick-style curve, there are going to be opportunities to develop more landfills in the future.”

And while other types of brownfield sites have the potential to be cleaned and redeveloped for other uses, in Fitzgerald’s estimation, for landfills, “there probably really is no better post-closure usage than solar.”

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