Emily Lane Murray, Allen Matkins Leck Gamble Mallory & Natsis LLP
October 10, 2012 | 3 Comments
At first blush, the siting of renewable energy projects on contaminated properties may seem like an ideal reuse of environmentally compromised sites. However, the redevelopment of contaminated properties can pose unique challenges for renewable energy projects. Overcoming these obstacles requires careful planning as well as communication with oversight agencies. Many agencies, including the U.S. Environmental Protection Agency (EPA), have new programs in place to assist renewable energy developers with contaminated property redevelopment.
By way of example, consider the installation of a large scale solar facility on a closed and capped landfill. The site may not be suitable for many other types of uses, and may therefore provide the solar developer with an appealing and lower cost location. In addition, the reuse of the site for solar energy may be attractive to the community and to the oversight agency or agencies. However, there are technical and legal challenges that need to be considered and accommodated in the project pro forma.
Technical challenges unique to the landfill location include issues such as disruption of the landfill material or landfill cap. In addition, there may be geotechnical difficulties resulting from differential settlement of the landfill material. There may also be practical challenges, such as designing access roads and connecting to existing transmission facilities. Ideally, the proposed reuse of the site for solar would be considered during the landfill closure, so that technical issues could be addressed through the engineering of the closure. If not, the solar developer will need a very complete understanding of the landfill closure plan and site to assess whether the proposed solar use is feasible.
From a legal perspective, the solar developer will need to assess and avoid to the extent possible any liability associated with the landfill conditions. Both owning and operating a contaminated site may potentially subject a developer to environmental liability. Liability protections in the form of agency agreements, prepurchase investigations, and insurance will need to be explored. The developer should also carefully consider any deed restrictions or other permitted use issues associated with the closure of the landfill.
Many contaminated sites are already under the control or supervision of an oversight agency, such as a local fire department or county, or a state or federal environmental agency. These agencies are responsible for ensuring the safe and proper remediation of the contaminated site, and will likely also be involved in any site redevelopment. At the federal level, the EPA has an active program in place to promote the reuse of contaminated sites for renewable energy projects.
In 2008, EPA launched the RE-Powering America’s Land: Siting Renewable Energy on Potentially Contaminated Land and Mine Sites Initiative (RE-Powering Initiative) to encourage and facilitate the use of contaminated sites for renewable energy projects. EPA has identified and mapped more than 11,000 contaminated sites and nearly 15 million acres that EPA believes have the potential for developing renewable energy facilities. EPA offers an interactive mapping tool as well as national and state maps showing renewable energy development potential on EPA's RE-Powering Initiative website.
In 2012, EPA released its Handbook on Siting Renewable Energy Projects While Addressing Environmental Issues, which identifies and provides information regarding environmental site issues facing renewable energy projects during site cleanup. The handbook also addresses considerations for integrating renewable energy into the Superfund, RCRA, and Brownfields cleanup processes.
Communication with the applicable oversight agency is critical to successful redevelopment of a contaminated site for renewable energy. As indicated by the EPA materials, many agencies are very supportive of renewable energy uses, and can provide a great deal of information and guidance through the process. A cooperative relationship with the oversight agency or agencies can often result in reduced costs and delay avoidance, and is therefore an important element of project success.
Another consideration for renewable energy siting on contaminated properties is potentially available incentives for the projects. The DSIRE website provides a good source of information on state, local, utility and federal incentives and policies promoting renewable energy project development. DSIRE is funded by the U.S. Department of Energy, and is maintained by the N.C. Solar Center and the Interstate Renewable Energy Council.
In conclusion, renewable energy projects sited on contaminated properties can be successful, but advance planning, communication, and understanding of the site's unique challenges are critical to that success. The emerging agency support for these projects is likely to result in an increase in interest among project developers, and may result in an important industry-wide shift toward consideration of such sites.
Lead image: Landfill via Shutterstock