Business / Economy

Environmentalists win, county loses revenues in solar project settlement

After years of legal maneuvers by environmental groups, the Panoche Valley Solar Project is reduced to one-third of original design as ConEdison plans to move much of the project to Southern California

Within days of San Benito County Supervisors Anthony Botelho and Jerry Muenzer threatening a lawsuit and calling Consolidated Edison Development (ConEdison) “crooks” and accusing them of “raping and pillaging the county” during the July 18 board meeting, there was a protest letter from ConEdison’s Senior Vice President and Chief Operating Officer James J. Dixon, claiming their statements were unfair and “vitriolic.” The heated back-and-forth was prompted by supervisors' anger at learning that the county would not be receiving any sales taxes from the Panoche Valley Solar Project, located in southern San Benito County.

But even before county staff had the time to research litigation options, the very same environmentalists who had filed multiple lawsuits against the project, announced Friday, July 21, that they had won, which ultimately will shrink or possibly kill the project that promised hundreds of jobs and millions in tax revenues to San Benito County.

In a press release, the Sierra Club announced that it and a number of other environmental groups, along with Panoche Valley Solar LLC, a subsidiary of Consolidated Edison Development, Inc., had entered into a settlement agreement concerning the size and location of the solar project.

The Sierra Club said that the agreement will help advance renewable energy in the state, create local jobs, and protect the environment. Once final, the settlement will permanently conserve more than 26,000 acres for wildlife habitat in San Benito County while reducing the scope of the project here.

The questions that remain unanswered, however, include where that energy will be created and what jobs are they talking about. It’s certainly not the 500 to 1,000 jobs, nor 399 megawatts of solar power that were originally forecast in southern San Benito County when project planning began in 2009

Initially, 247 megawatts of solar generation was planned for development in the Panoche Valley, the released claimed, but now approximately 100 megawatts is, instead, proposed for development at a site in Imperial County, in Southern California.

Panoche Valley Solar LLC managed to defeat two previous lawsuits brought on by the Sierra Club and Audubon Society in 2011 and 2013, but the environmental groups remained steadfast in their opposition.

The release went on to state that when the solar project was first proposed, it would have directly impacted nearly 5,000 acres of high-quality and uniquely important habitat. This settlement will reduce the size of the project in the Panoche Valley to slightly more than 1,300 acres and permanently conserve approximately 26,418 acres in and around the Panoche Valley.

The environmental groups assert that the Panoche Valley has the last intact, but unprotected, grasslands in the San Joaquin Valley, and is home to many rare and endangered species including the giant kangaroo rat, the San Joaquin kit fox, and the blunt-nosed leopard lizard. The valley is also designated an Important Bird Area of Global Significance by the National Audubon Society and Birdlife International because the grasslands "provide essential habitat for myriad resident and migratory bird species. All of these species have been under threat from the expansion of housing developments, agriculture, oil and gas exploration, and drought," the groups noted.

Development at the Imperial County site will have less impact on threatened and endangered species and their habitat, the release stated. The relocation of that portion of the project is subject to approval by Southern California Edison and the California Public Utilities Commission (CPUC). The settlement will also resolve several legal challenges commenced against the project by the environmental groups.

San Benito County Supervisor Mark Medina told BenitoLink that perhaps the county should have spent more money on better contract lawyers to ensure sales tax revenues would be paid, no matter what happened to the solar project.

He said blame for the project’s downgrade and loss of revenue to the county was as much the county’s fault as it was the environmentalists' unrelenting opposition. He said it did not matter that the project was reduced from a 399-megawatt system down to 130 megawatts. If the contract had been written correctly, Medina said, the county should be paid sales taxes based on the original 399 megawatts.

“What I’m concerned about is how we will react to things like this in the future,” he said. “We need to have tight contracts that will be advantageous to the county whether a company or agency is no longer able to pay what they originally stated they would.”

When asked if that would even be a legal option, Medina said, “A contract is a contract. Even if they go into bankruptcy or change locations, you can still go after their assets. At least negotiate with them. They’re still building. Even if it’s in Imperial Valley, it’s the same company.”

Medina said he wouldn’t say the supervisors who approved the deal were “asleep at the wheel,” because everyone anticipated the project would always be a 399-megawatt solar facility. “Therefore, it was going to bring, I think it was $20 million to this county. When the supervisors made this decision, it was based on the bottom line. In the future when we do these contracts, how do we protect ourselves to make sure we receive those dollars, whether a company succeeds, fails or moves?”

Mark Noyes, president and CEO of Panoche Valley Solar, said in the press release, “This settlement with the California Department of Fish & Wildlife and the environmental groups to lessen the impact of the PVS solar project on Panoche Valley is reflective of Con Edison Development’s corporate value of concern for the environment and commitment to continue the development of clean energy generation in a responsible manner. We will work diligently with the other parties to obtain the remaining approval of SCE and the CPUC so that the conditions of the settlement can be fully implemented for the benefit of the Panoche Valley ecosystem and the citizens of California.”

Charlton H. Bonham, director of the California Department of Fish and Wildlife, stated in the release, “Con Edison Development’s leadership and the environmental groups deserve a lot of credit for opening a dialogue with the Department and asking whether it was better to negotiate and collaborate than litigate. Now these lands will be conserved in perpetuity for some of California’s rarest animals without a loss of one megawatt. This settlement shows that it is possible to balance the environment and the economy to achieve ambitious renewable energy goals.”

Kim Delfino, California program director of the Defenders of Wildlife, stated, “The Panoche Valley is a globally important landscape and is the only remaining intact habitat for endangered upland San Joaquin Valley species like the giant kangaroo rat, San Joaquin kit fox and the blunt-nosed leopard lizard. The new agreement recognizes the significant conservation value of the Panoche Valley, reduces the size of the project in this unique valley and moves half of the project to a better site outside of the valley. When projects are planned ‘smart from the start’ it ensures that we will not sacrifice.”

Read the original contract for the solar project in the attachment below.

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John Chadwell

John Chadwell is a BenitoLink reporter and an author. He has many years experience as a freelance photojournalist, copywriter, ghostwriter, scriptwriter and novelist. He is a former U.S. Navy Combat Photojournalist and is an award-winning writer who has worked for magazine, newspapers, radio and television. He has a BA in Journalism and Mass Communications from Chapman University and underwent graduate studies at USC Cinema School. John has worked as a script doctor and his own script, God's Club, was released as a motion picture in 2016. He has also written eight novels, ranging from science fiction to true crime that are sold on Amazon. To contact John Chadwell, send an email to: johnchadwell@benitolink.com.