Some Real Numbers About Transitioning a Coal Plant to a Solar Farm

Power density was on display yesterday in Holyoke, Massachusetts.  Virtually anyway.  There was a groundbreaking for a 5.8 MW solar farm.  This is wonderful news.  The old, inefficient, environmentally challenged, coal-fired Mt. Tom Power Station ceased operation in 2014.  The community wondered whether it would be a long-lived eyesore (like the long-closed English Station in New Haven, Connecticut) or would something new come along to take its place (like the remodeling of Chester Station in Pennsylvania into Class A office space with a soccer stadium to go with it?  Or would it remain true to its existential essence and continue to deliver electricity, albeit from a different source?

Holyoke investigated the realm of the possible.  There were lots of constraints:  flood plains, endangered species, steep terrain, ash ponds and landfills, among others.  A 20-something-acre solar farm emerged as a frontrunner.  Permitting was easier.  Flood risk was more manageable.  The power infrastructure was already there.  There would be economic benefits too.  Annual wages were predicted to be $200,000 for 1-3 employees.  Payments-in-lieu-of-taxes would be of the order of $30,000 annually.

Which brings us back to power density.  In Power Density: A Key to Understanding Energy Sources, University of Manitoba professor Vaclav Smil explains power density (as he uses the term) as the rate of energy flux per unit area of land used (units are watts per square meter – W/m2 , or kilowatts per square meter – kW/m2).  In lay terms, power density answers the question of how many acres of land does a particular power source need to power a lightbulb.  As one might expect, some sources are more land intensive than others.  For example, in a precursor to his book Professor Smil swiftly catalogs reasonable maximum power densities for, among others, coal (1 kW/m2), natural gas 4-5 kW/m2), wind (2 W/m2) and photovoltaic solar (15 W/m2).  Note that the power densities of fossil fuel sources are orders of magnitude greater than those of renewable sources.  Professor Smil uses this data to develop his thesis that our society based on concentrated sources of energy is going to have to fundamentally reorganize itself if it transitions to renewable energy sources. 

The Mt. Tom Power Station generated 136 MW of electricity.  With Professor Smil’s numbers we might expect a solar farm on the Mt. Tom site to generate only a fraction of the power; the proposed 5.8 MW confirms that prediction.  All of this is very good information for engineers, but what does it say that a lawyer can use? 

It says quite a lot, actually.  We can pivot off of power density to tax density and employment density.  When operating, the power station contributed over $1,000,000 in annual property taxes to the community.  The solar farm will pay far less.  There is a $29,000 annual payment-in-lieu-of-taxes, plus whatever (small) property tax assessment is assessed. Twenty-eight people held jobs at the power plant.  Two will run the solar farm (but will be based in Fitchburg, not Holyoke).  Here’s a rough number:  closing a coal plant in your community and repowering with solar will remove over 90% of the taxes paid and 90% of the employment formerly provided by the operating plant.  Lawyers advising businesses in communities with coal plants need to keep this in mind, particularly with coal plant closures coming more frequently. 

It is wonderful news that a shutdown coal plant is turned to productive use.  But it is not nirvana.  Hardnosed business lawyers should not be Pollyanna.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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