The “Big Beautiful Bill” is winding its way through the federal budget reconciliation process, complete with provisions that pull the rug out from under renewables, including the US solar energy industry. Still, new signs of life continue to emerge as innovators jockey for position in the decarbonized grid of the future. After all, elected officials come and go, and the next mid-term elections are just less than 18 months away.
More Solar Energy For The US: Follow The Money
The latest news about innovation in the US solar energy field involves a Virginia-based startup, the independent power producer Earthrise Energy. The company launched in 2019 and it has just announced the close of financing for Gibson City Solar, a 270-megawatt (AC) solar power plant under construction in Illinois.
The Gibson City project is of interest from a number of different angles. It is a fairly large project in a time when solar proposals face increasing opposition from local residents and outside influencers, though that’s not the most interesting thing about it.
The project is also another demonstration that new state policies, new types of financing, and an assist from the global financial community, can all help the US solar industry keep moving forward regardless of counterproductive policies promoted by state-level lawmakers as well as those in Congress.
That is a little more interesting. Though many other US solar projects have been funded through overseas financial institutions, Earthrise describes the $630 million financial transaction for Gibson City as a “first-of-its-kind tax equity and debt financing” deal. It involved a branch of the corporate and investment bank BBVA as one of three Coordinating Lead Arrangers and bookrunners for the debt financing, which consisted of a construction loan, a tax equity bridge loan, and a letter of credit facility.
With roots that go back to the 1850s, BBVA describes itself as the largest financial institution in Mexico and a leader in the Spanish market, including South America and the US Sunbelt. “It is also the leading shareholder in Turkey’s Garanti BBVA,” the firm states of itself.
The other two Lead Arrangers are the top European banking group Intesa Sanpaolo and the leading German bank NORD/LB. In addition, the deal includes a tax equity commitment from a “Fortune 500 telecommunications company” to be named later.
Earthrise also notes that the transaction is among the first in Illinois to leverage a new “Indexed Renewable Energy Credit” offtake agreement authorized by the Illinois Power Agency.
Sneaking Solar Energy Through The Back Door
All of that is interesting. However, what makes this project particularly interesting, and potentially influential, is Earthrise’s business model.
Back in 2021, Earthrise began buying up existing gas peaker plants along with their transmission interconnections, reaching a total of about 1.7 gigawatts. Now the company has more than 1.4 gigawatts of solar energy in its pipeline too, all consisting of projects that are entitled to use the grid connections at its thermal power plants.
In other words, Earthrise has figured out how to skip the dreaded interconnection queue and introduce more solar energy into the grid more rapidly.
The Gibson City project illustrates how that business model works in financial markets. “This novel transaction is distinguished by its shared point of interconnection between the solar project and Earthrise’s existing thermal power plant, using surplus interconnection service,” Earthrise explains.
“This transaction marks a pivotal achievement in delivering utility-scale solar solutions to the grid backed by a differentiated project development strategy, robust financial innovation, and operational discipline,” emphasized Earthrise CFO Jeff Hunter in a press statement.
The Gibson City solar project is just one opportunity, as indicated by the company’s VP of Capital Markets, Kenton Harder. “This structure presented attributes that required innovative structuring, and together with the coordinating lead arrangers and tax equity investor we developed solutions which we believe will serve as a blueprint for similar projects going forward,” said Harder.
Delivering The Kilowatts, Faster
The US solar industry has been working overtime to convince Republican members of Congress that solar energy can deliver more kilowatts, more quickly, than any other form of power generation.
All else being equal, solar developers are at a particularly strong advantage in the wake of Biden-era policies that saw a massive surge in solar manufacturing capacity in the US, providing developers with a robust domestic pipeline for solar modules. Meanwhile, gas power plant developers have to deal with wait times for new turbine deliveries stretching up to seven years due to a supply bottleneck.
Earthrise faces no such supply obstacles for its solar energy plans. “These projects leverage the existing interconnection rights held by the peaking plants to deliver clean, cost-effective power to the grid with unparalleled speed to market,” Earthrise states, emphasizing that it can bring new solar energy resources online “faster than typical greenfield renewable energy projects.”
What About The Farmers?
As for how Earthrise was able to move its project through the permitting process, last year the news organization Ford County Chronicle provided a detailed rundown of Earthrise’s efforts to communicate how the 1,300 acre solar array will impact the community and the property owners who leased their land for the project.
Avoiding sensitive habitats and cultural sites were among the site selection considerations Earthrise brought to community meetings. The project will also be screened by trees and will include pollinator native grasses and habitats around and within the array, a common practice among US solar developers today. As reported by the Chronicle, Earthrise also plans to establish a wildlife habitat at the site.
“The project also is expected to generate more than $23.9 million in property tax revenue for local taxing districts over its lifetime, including more than $16 million for local schools and more than $3.7 million for Ford County,” the Chronicle also reported.
“The land that is part of the project…is expected to generate “11 times the agricultural revenue of an agricultural farm in the county,” the Chronicle added.
Word seems to be getting around. Last month, the Chronicle reported that plans are moving forward for Louis Creek Solar, a new 50-megawatt, 380-acre solar energy project under the wing of the Chicago startup Allium Renewable Energy, (formerly PNE USA) to be located near Buckley, Illinois about 20 miles from Gibson City.
If all goes according to plan, the solar array and a 10-megawatt co-located battery energy storage system will be up and running by the first quarter of 2027, with a grid connection through the utility Ameren already in hand. Try that with your gas power plant.
Meanwhile, the “Big Beautiful Bill” passed the Republican-controlled House of Representatives. Now it is in the hands of the Senate, which also holds a controlling vote. If your representatives in Congress have taken a public position on the bill, drop a note in the comment thread.
Photo: Via CleanTechnica archive.
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