Commissioners approve economic development agreement for solar farm
After more than a year of negotiations and eight months after a tax abatement was approved for the project, Putnam County now has an economic development agreement on a proposed solar farm in Russell Township.
In a special meeting Friday, the Putnam County Commissioners unanimously approved an economic development agreement with Arevon Energy that will provide the county a payment of at least $5.7 million once construction is complete.
District 1 Commissioner David Berry made the motion, as the development will take place in his district. Tom Helmer seconded the motion, with Rick Woodall joining the affirmative votes to make it a 3-0 decision.
Cold Spring Solar Farm is a proposed 200-megawatt solar project that would be located on private land east of Russellville. The property itself will remain the property of current landowners, with Arevon leasing the land for at least 30 years.
While the exact details of the economic development agreement are now worked out, the final numbers will not take shape until the full scope of the project is determined.
As planned, the project, which developer Tenaska is handling for final owner Arevon, is a $383 million investment for a 200-megawatt farm. Based on these exact numbers, Arevon would owe the county a $6.3 million economic development payment.
If either the investment amount or the number of megawatts generated increases or decreases, the payment would increase or decrease accordingly.
However, the smallest payment the county would receive is $5.7 million.
With the economic development agreement now in place, a tax abatement for the project, approved by the Putnam County Council last December, is now valid.
The council approved a 75-percent abatement of all personal property of the project for a period of 10 years. Despite this discount, Arevon estimates Cold Spring would bring in $40 million in property taxes over the 30-year life of the equipment.
Woodall, who has been central to the negotiations for the county, expressed the mixed feelings he has had throughout the process.
“My stance has always been that I’m not a fan of solar farms, but I’m also not a fan of telling people what to do with their land,” Woodall said. “So if these people want to do this, it’s their land. The cons are it takes out 1,400 acres of farmland. The pros are it will provide electricity, it will lower the taxes to the residents of PC and it will also give an infusion of cash to a county that desperately needs some bridges and some roads fixed.”
Woodall also noted that Putnam would become the first county in the state to receive its economic development payment from a solar development in a single, lump sum.
The commissioners also approved the core language of agreements on both road use and decommissioning. The exact verbiage of these agreements will have to be worked out as the project develops.
There are still multiple hurdles for the project to clear before it becomes reality. One is that Arevon is still awaiting approval for the proposed farm to even connect with the energy grid, via MISO (Midcontinent Independent System Operator). Without MISO approval, there would be no customers for the energy generated.
MISO approval was supposed to come in July, then was delayed until October, and now is being estimated at January or February. This is reportedly an industry-wide problem right now.
Locally, the only remaining hurdle is approval of a special exception by the Putnam County Board of Zoning Appeals. While a solar farm is an allowed special exception, the BZA has the right to impose certain restrictions as part of granting any special exceptions.
The matter is set to be on the BZA agenda during a special meeting at the Bainbridge Community Center at 6 p.m. on Tuesday, Aug. 14. If past practice of the BZA is any indication, it could take several months for the matter to be settled.
Besides any restrictions put in place by the BZA, Cold Spring will need to meet all applicable legal and environmental requirements, including the standards in Putnam County’s solar ordinance, to be approved for construction.
In an unfortunate bit of scheduling by county officials, the BZA meeting will run partially concurrently to the August Putnam County Council meeting, which is set for 6:30 p.m. Tuesday at the Putnam County Courthouse.
A solar farm matter will also be on the agenda for that meeting, with the council considering a request to add additional acreage to the project.
Woodall shared that developers say the best case scenario for them is to have construction begin in 2024 and be done by the end of the year, with power generation by the first quarter of 2025.
If this happened, the county would not see its economic development payment until late 2025 or early 2026, with tax rates likely unaffected until 2027.
“This agreement shows how solar energy can help strengthen Indiana communities. We are grateful to Putnam County for creating an agreement that will benefit their residents, local landowners and Indiana’s energy sector for years to come,” Arevon Development Director Thomas Hudzik said. “County officials struck a great balance between the need for economic development, the interests of the community, and the property rights of individuals.”
According to Arevon, the project would generate enough clean electricity to power more than 30,000 homes while providing lease payments to local landowners and creating more than 220 construction jobs.