There’s a Bright Outlook for Nelson Mullins Teams and Solar Power Projects
Staff Report From South Carolina CEO
Thursday, August 29th, 2019
With the renewed emphasis on solar power as a source of affordable energy, the sun is shining for Nelson Mullins attorneys and practices with experience in the industry. Several attorneys recently have been on the forefront of deals leading to solar farms and other projects that provide clean energy and jobs, particularly in the rural South where sun is plentiful, land is abundant, and jobs are needed.
Earlier this year, the team of Andy Litvak, Laura Snider, Cindy Higgins, and Rebecca Odonkor assisted in the acquisition of two adjacent properties for what is billed as the largest solar development project in Georgia. The team represented a solar farm developer in the acquisition of land from two different sellers in Early County, Ga. The properties will be developed into an approximately 1,450-acre solar energy farm that will provide energy for a new nearly 1 million-square-foot data center.
In addition to the acquisition, the team assisted with the negotiation of a rail crossing agreement for the energy lines with Norfolk Southern, advised on removing the property from a use restriction placed on the property governed by Georgia’s Forest Land Protection Act, and acted as local counsel for the solar improvements’ financing following the land acquisition.
With the U.S. being the second-largest market for solar in the world, Georgia and the southeast appear to be booming destinations for solar farms because of the expanses of unfarmed land with welcoming sellers and temperate climates, observers say. As a testament to the potential growth, what is said to be the largest solar panel factory in the Western Hemisphere went online in northern Georgia earlier this year.
Solar Growth on Rise
Renewable resources, particularly wind and solar, have experienced tremendous growth in the U.S. and will continue to grow as demand increases, notes D.C. energy team member and industry observer Steven Shparber.
Spurred by a combination of improved technological performance, declining costs, increased consumer demand, federal tax credits, and state policies, wind and solar resources are poised to account for more than 10% of all electricity generated in the U.S., he says. “But for renewable energy to achieve its full potential in the U.S., new market rules, operational protocols, and financing structures are needed,” he said.
Shparber co-founded the Solar RTO Coalition in 2018, a group of developers and capital providers of large-scale solar projects that combined with the American Wind Energy Association in January 2019. In representing this group, along with the Solar Energy Industries Association, before the Federal Energy Regulatory Commission and the country’s deregulated wholesale power markets (referred to as Regional Transmission Organizations), Shparber is involved in advocating for changes that will have a profound impact on future opportunities for renewable energy across the U.S.
“Solar farms create clean energy and thousands of jobs across the country,” said Litvak, a leader of the real estate group. “This is a dynamic area with great potential for growth, and we are excited to be helping provide new energy production through these projects.”
His team also recently assisted in completing:
The acquisition of two adjacent properties with two different sellers in Jeff Davis County, Ga. that are now being developed into an approximately 930-acre solar energy farm.
The acquisition of other solar farm sites in Appling, Lee, Clay, Early, Jeff Davis, and Stewart counties in Georgia.
The real estate team’s Snider notes that solar farm deals differ from other real estate transactions in several ways: “You’re usually dealing with large tracts of land in rural communities that might have mineral reserves or other unique title or property-related issues.”
Raleigh partner Beth Trahos, who focuses on zoning requests related to commercial solar projects, notes that these areas generally are perfect for solar farms.
“The surrounding land uses are usually agricultural or industrial and low-density residential. Solar farms are good neighbors for all those uses. They are quiet, they are safe, they generate little traffic, much fewer trips than one single family home. They’re low in height — lower than a barn or house — and they use no county services,” she said.
But what do the neighbors think?
Proposed projects don’t always have smooth sailing with the neighbors.
She and partner Brett Hanna have worked on more than 250 solar projects since 2011, including a recently obtained conditional use request by Trahos for a North Carolina company’s proposed 32-acre farm in Franklin County, N.C.
Hanna recently obtained the go-ahead for an 80 megawatt farm on 369 acres in Nash County, N.C. They also have projects in the initial stages in northern South Carolina. His and Trahos’ forte is working with planning and zoning boards as well as negotiating tax matters and transactions.
“They can be extremely controversial,” Hanna said. “You get the whole spectrum: legitimate concerns and some unreasonable. Typically neighbors think it will lower their property values, even though there’s plenty of data to show that they don’t. Many think they are ugly. Some people have heartfelt fears for wildlife, that they cut off animals’ cross paths, and we’ve even heard concerns that coyotes would get trapped in them.”
The future looks bright
North Carolina recently was noted as second in the nation for installed solar and Charlotte as 28th in the country. It was almost a decade ago in the Queen City that Charlotte partner Larry Ostema assisted in the first solar project at Charlotte Douglas International Airport, the sixth busiest air hub in the nation.
The airport installed 1,190 solar panels on the roof of a maintenance and administrative building. The array produces some 330,000 kilowatt hours of energy a year. Ostema wrote the Request for Proposals, negotiated the agreements with the developer, and structured the tax incentive.
A recent addition to Ostema and Weston Adams’ growing energy team is Zoë Gamble Hanes, a former chief executive officer and president of Pine Gate Renewables, LLC, where she oversaw the development of 1,000 megawatts of solar projects in 12 states and managed more than 350 megawatts of operating solar assets. Before joining Pine Gate Renewables, she was general counsel and vice president for FLS Energy, which sold to Cypress Creek Renewables in 2016. She also has worked as a special counsel for Winston-Salem law firm Blanco Tackabery, where she was actively involved in structuring the monetization of the North Carolina renewable tax credit.
Adams and other team members, including Jamey Goldin and Jeremy Hodges, have been in the forefront of solar policy development in South Carolina by representing solar interests at the S.C. Public Service Commission (SCPSC) in a number of dockets mandated by the recently enacted SC Energy Freedom Act. “These SCPSC dockets will have a significant effect on the future of the solar industry in South Carolina,” Adams said.
He and the team are also currently representing the renewable sector on a variety of utility commission renewable matters, including a Certificate of Public Convenience and interconnection matter in front of the North Carolina Utilities Commission (NCUC), microgrid litigation at the District of Columbia Public Service Commission, electric vehicle charging station matters at both the SCPSC and the NCUC, and Public Utility Regulatory Policies Act solar litigation at the SCPSC.
For several utility-scale projects already under way in South Carolina, Charleston partner Shawn Willis has been involved in securing site control agreements and writing the title insurance involved with project finance. In addition to dealing with project sites owned by private landowners, he has also recently assisted with site control for property owned by public agencies at both the state and federal level.
On the residential side of solar, members of the Affordable Housing team in Florida are involved with solar project reviews for low income housing, an area where recent studies by clean power organizations are focusing their attention.
New York-based George Pavlenishvili has been involved in solar and wind projects both domestically and internationally. He is bullish on the future of solar.
“Despite many regulatory uncertainties, renewable energy remains an attractive investment for the increasing class of investors as well as lenders,” he said. His optimism, he says, comes despite a decrease in power purchase agreement (PPA) prices and their shorter tenure as well as lower yields and the phasing out of tax credits within the next few years.
“Tax equity still remains the most significant source of project financing for the renewables projects in the US this year; time will tell how fast other sources will replace tax equity. But with so much demand for solar and wind, we believe the U.S. renewable industry will continue to grow.”