Scrap value, ag value detailed in Lethbridge solar field approval

By Southern Alberta Newspapers on December 6, 2024.

A plan to build major solar fields near Lethbridge has been approved as regulators reveal some details of how they will now consider cleanup financing and agricultural productivity of sites as provincial policy direction evolves on the subjects.
A decision by the Alberta Utilities Commission on Lethbridge Solar Two and Three proposals states today’s estimates on scrap value 25 years into the future can’t be relied upon.
As well, arguments from opponents that that low- or mid-range dryland fields being improved by irrigation are too “speculative” to be given weight in decision making.
The two projects would be built side by side on 586 hectares of private land about 3.5 kilometres south of Lethbridge in Lethbridge County.
The Alberta Utilities Commission issued an approval Tuesday to erect 315,000 solar panels that, in total, are designed to produce 157 megawatts of power for the Alberta grid in peak conditions. A completion date on the permit is in March 2027.
Last year, the province halted all new renewable energy approvals for seven months as it said study of reclamation, effects on agricultural productivity and “pristine viewscapes” was needed.
The Lethbridge Solar Two and Three applications include estimates that 95 per cent of eventual reclamation costs could be covered by the salvage value of metal and components when the array is decommissioned in 25 to 30 years.
That is “not sufficiently conservative” considering the extended timeline and other uncertainties, the Alberta Utilities Commission panel stated.
However, it states either an existing private cleanup agreement with the landowner, including a bond, or an incoming provincial system for decommissioning security, should suffice.
Exhibits place the salvage value of the equipment at $24.3 million compared to a total reclamation cost estimate of $25.2 million.
“The commission is concerned that the third-party estimate is not sufficiently conservative, as it estimated prospective salvage value to cover approximately 96 per cent of the costs of reclamation,” reads the decision. “The salvage value is dependent on the market value for the power plant components at an uncertain date well into the future.”
A provincial program for reclamation security is still being developed and would be applied to projects approved after March 2024.
The company shall not consider more than 50 per cent salvage value against costs.
It will need to provide an updated estimates plan before construction commences, then every five years and filed with the AUC.
The commission also found that the effect on views of the Rocky Mountains from the site were minimal.
The approval specifies an in-service date for the plants as March 31, 2027.

2
-1