The solar industry says its days have been darkened by an investigation announced last month by the U.S. Department of Commerce.
Four-fifths of 730 solar companies responding to a Solar Energy Industries Association survey released last month said they expect “severe or devastating impacts” from a probe of allegations that Chinese manufacturers shifted production to Southeastern Asian nations to avoid paying American tariffs on China-made solar products.
Now the investigation is casting a shadow over an Appalachian Power proposal for a utility-scale solar project.
Appalachian Power submitted a filing with West Virginia utility regulators last week calling their attention to a letter it received from D.E. Shaw Renewables Inc. (DESRI) Bedington Holdings LLC, the New York-based company working to develop and construct a 50-megawatt solar facility in Berkeley County.
DESRI Bedington Holdings warned that the Department of Commerce investigation’s effect on the cost and time frame for completing work on the project “cannot be determined” for now, calling the probe a force majeure event.
Force majeure is a provision in contracts lifting liability for an event outside a party’s control.
An attorney for Appalachian Power and fellow American Electric Power subsidiary Wheeling Power told the West Virginia Public Service Commission in last week’s filing that the companies would follow up with DESRI.
“[T]he extent of the impact of these matters is currently unknown,” company counsel Keith Fisher wrote to the commission.
The D.E. Shaw Group did not respond to a request for comment.
In a subsequent filing, the AEP subsidiaries said they don’t anticipate any delays for the planned solar facility, which is expected to be in service by October 2023.
Appalachian Power and Wheeling Power have reported a revenue requirement of $3.4 million for West Virginia ratepayers for the 50-megawatt facility. They expect the project costs to be covered by customers paying a proposed renewable power tariff with a surcharge to cover the balance. The companies propose an average monthly residential rate increase of 1 cent.
Appalachian Power plans to acquire the Berkeley County facility once it’s completed.
In another pending request, the companies sought approval of a 204-megawatt wind energy project in Logan County, Illinois; a 150-megawatt solar facility in Pittsylvania County, Virginia; and a 4.9-megawatt solar project in Amherst County, Virginia. The companies also asked for approval to enter into power purchase agreements for three Virginia solar facilities totaling 88.9 megawatts that wouldn’t begin service until December 2024. Regulators in both Virginia and West Virginia must approve the plan.
Participants in a West Virginia Center on Climate Change panel discussion focusing on utility-scale solar conducted Monday in Morgantown noted that the inquiry could pose a serious short-term threat to solar growth.
“I can tell you that it’s having a really detrimental effect,” said David Feldman, senior analyst at the National Renewable Energy Laboratory, a U.S. Department of Energy lab.
The Solar Energy Industries Association survey reported that many developers don’t know when they might get solar panels, with projects pushed to later years limiting what’s possible from new projects.
But solar has a bright long-term future building on years of rapid expansion, the panelists said.
Feldman noted that global annual photovoltaic capacity additions skyrocketed from fewer than 20 gigawatts-DC in 2010 to roughly 170 gigawatts-DC in 2021, including significant increases in the United States over that span, according to International Energy Agency data.
Danny Chiotos, sales and market development director at Mountain View Solar, a Berkeley Springs-based solar installer, alluded to a backlog of planned West Virginia solar projects to make a case that there is a “wave of utility-scale solar” coming to West Virginia.
“[D]ue to utility-scale solar, the size of our installations and the size of other companies’ installations are about to be dwarfed,” Chiotos said.
The Berkeley County project proposal is Appalachian Power’s first under Senate Bill 583, the 2020 state law that encouraged utility-scale solar development in West Virginia.
The Public Service Commission green-lit FirstEnergy’s first proposal under SB 583 last month, granting conditional approval of five utility-scale projects across West Virginia.
PJM’s new services queue shows more than 4,200 megawatts of capacity for active solar projects not yet in service in West Virginia.
PJM, the regional transmission organization that coordinates wholesale electricity movement in West Virginia and all or parts of 12 other states, has proposed a new approach to processing interconnection requests that could delay interconnection projects piling up in a bulging backlog for years.
But AEP and Mon Power have said they don’t expect interconnection issues with their solar proposals they have put before the Public Service Commission. The agency has yet to rule on the proposal from Appalachian Power and Wheeling Power.
“There’s a lot of solar that is in line to be connected in West Virginia,” Chiotos said.