Commission OKs abatements for county’s largest investment | News

The Walker County Commission on Monday unanimously approved property tax and sales and use abatements for a major solar farm project – thought to be the largest single capital investment in the history of the county – that officials project could supply Alabama Power and generate millions of dollars for local schools in tax revenue.

“This is history-making for Walker County,” Chairman Steve Miller said of the project, expected to at least bring in a half-billion dollars in investment, and possibly closer to $900 million if two more sites are included.

The property tax abatement will be for 20 years, while the sales tax version is an “until placed in service” abatement which goes away when construction is complete, according to David Knight, the executive director of the Walker County Development Authority.

Officials revealed details at the July 17 commission meeting for what has been called in code Project Helios – playing off the name of the god of the sun in Greek mythology.

Knight said after the meeting that some state abatements still have to be worked out, but officials are confident that all the details will be agreed upon and the project will be started.

“That should be done without any problem,” he said. “Everything should move forward with this.”

Veronica Crock, a senior project manager for the Alabama Department of Commerce, was also on hand. Brinkley noted it is rare the state is represented in such situations. Crock said it was “a great project” that had been worked on for some time, and expressed support for the abatements on behalf of the state and Gov. Kay Ivey.

Officials said the three installations could be developed, creating an investment of approximately $500 million. However, it is possible over time up to five solar fields could be created, increasing that investment of more than $800 million. The solar fields would be created one at a time, taking eight to 12 months to construct. Several hundred construction workers are expected to be hired for the project.

Attorney Tom Brinkley of law firm Maynard Nexsen, told the commission in a presentation he represented a large international company, Ingka Investments, which several years ago bought a large tract of land in the county.

“It is now taking a small piece of that to develop these solar projects,” he said. “It is not a developer that is coming in to build it and flip it. They are here to hold it for their own portfolio. They are actually a company that wants to invest in the long-term.”

Three sites – and possibly five – could be developed for solar farms.

“There is about $5,000 a year coming into Walker County from these three sites because they are timber land, on current use valuation. With the new investment, it would be averaging $175 million. It will be a substantial increase.”

In an undeveloped state, the Walker County School System would expect to receive $100,000 over the 35-year life of three sites.

“Even with the proposed tax abatement, that would jump to $20 million for those three sites over the first 20 years of the project, and that would increase to $28 million for the school system for the 35-year life of the project,” Brinkley said.

Knight explained that taxes going to education cannot be abated by state law, with 9 mills to be abated and 10 mills of the 19 overall mills going to education. Jasper schools would not benefit from the taxes.

“The education system always gets their full allocation of funding,” he said. The potential sales tax alone that would be generated with the construction and equipment, based on state Department of Revenue analysis, is about $7 million, which would go to the county school system. Over the 35 years, Knight repeated the $28 million impact with three facilities.

“With five facilities, you are looking at a potential for an over $30 million to $32 million impact,” he said. So this is a game changer and a significant shot in the arm for Walker County.

Brinkley and Knight warn the projects will take a while to be done. Knight said it was likely that each site would likely be done one at a time and might take about a year each to be constructed.

“These are each 80-megawatt projects with the energy being sold to Alabama Power Company if these all move forward. They have been working with Alabama Power Company, which is an important ally for this county as well,” Brinkley said.

Knight said the situation is unique as the county can build on its past.

“The property that is being looked at for these solar installations is all previously strip-mined property. So you’re taking previously mined property and converting it into a green energy source. There is a pretty unique and interesting story there moving forward,” he said.

Later, when it came time for the vote, District 2 Commissioner Jeff Burroughs said this was “huge” for the county, indicating he had been in meetings for two months on the project. He said the project had been “eye-opening” and is a huge opportunity for the county. “I hope this commission will keep investing in our development board,” he said.

He recognized Walker County Superintendent of Education Dennis Willingham, who said the project would benefit the school system for many years to come and that the school system was excited about the development.

District 1 Commissioner Keith Davis said it was a great day for the county and for the county industrial board.

“I know the school system desperately needs funding,” he said, noting similar action was taken with the Yorozu plant, which has been successful in terms of economic impact.

He also noted the large number of construction workers at the sites, hoping that many are hired locally but also a number are expected to come in and stay in hotels and eat. “All that economic impact will trickle down to this county,” he said.

Knight said, “You’re talking about three to five projects that once they start construction will take a year or so to actually build. You’re talking about several hundred construction workers during those periods of time,” taking up multiple years.

District 4 Commissioner Steven Aderholt said while he is a “huge fan of coal,” to take a site no longer producing coal and turn it into a site making solar energy for the future, he feels that is tremendous.

“As technology increases, we’re thankful for these kinds of investments in Walker County. Maybe we can be on the forefront of this type of energy going forward,” he said.

Miller – who was also given the approval to sign papers for the action – noted in meetings on the project, the commission was excited about what was coming and was looking forward for the children “for this county to be a solvent county, not a county that is struggling like we are today,” Miller said. Today, we recognize that is obtainable.

District 3 Commissioner Jim Borden said the project will be a “shot in the arm” for the southern part of the county.

“It will actually affect part of my district because we are close on the borderline there,” he said, noting many times people in that area have felt overlooked. He noted the county had lost Alabama Power’s Gorgas Steam Plant, and while it will “not be close to that many jobs, it will be good jobs in the future.”

After the meeting, Brinkley referred questions to the company by email.

Knight said after the meeting the company is still completing the process of researching the sites to find out which are the best, which still has to be determined. The company owns about 12,000 acres in District 2 in the unincorporated area. These installations will probably occupy 2,500 acres if five sites are taken, he said, noting they are about 500 acres a site.

“There will probably be a five-, seven-, eight-year construction process,” Knight said.

He also said it is thought to be the biggest investment in county history, and in the 27 years he has been doing this, this is the largest investment he has worked on. The biggest he has worked on until now has been Yorozu at about $135 million. And this is $525 million to $875 million, depending on the number of sites, he said.

The abatements will be phased in as each site is started. “It will not hit all at the same time,” he said.

State Sen. Greg Reed, R-Jasper, released a statement, saying, “Project Helios, a $525 million investment in Walker County, is an incredible economic development opportunity for our community and state. We’re expecting great potential for new job creation and an impressive economic impact through these energy projects. With this substantial investment in our community, Helios will directly benefit our local school systems and families across Walker County. I look forward to continuing to support economic growth through projects such as this in Senate District 5 and across the state of Alabama.”

State Rep. Matt Woods, R-Jasper, said, “I would like to express my gratitude to the Walker County Commission for their business-friendly approach towards industrial development. These incentives will not only contribute to job creation but also foster significant investment in our community. The Walker County Development Authority has displayed commendable collaboration with the commission regarding the Helios project. I am deeply appreciative of the strong partnership between these two organizations, as it will greatly benefit our community.”

The Southwest has been known for some time for solar farms to capture power for the grid. However, Alabama Power talks on its website about the solar potential for Alabama.

“The amount of sun shining at the earth’s surface is called solar insolation,” it said. Insolation values ​​are expressed in kWh/m2 per day, or the amount of solar energy measured in kilowatt-hours striking a square meter of the earth’s surface.

The utility company said several factors, such as weather, can affect insulation values. However, the values ​​in Alabama “are significant enough to support solar energy systems in our state, with the southwestern part of Alabama having equivalent solar insolation values ​​to most of the state of Florida.”

A chart showed an average insolation value of 5 in Birmingham, compared to 5.26 in Miami, 5.41 in San Antonio, Texas, and 6.60 in Las Vegas.

Some data from Exeter University, shown in a sourced article on Wikipedia, indicates that for most nations solar power will be the cheapest source of power by 2030. Solar News reported in 2021 that solar utility costs at the time amounted to about $1 per watt. The International Energy Agency was quoted in the article as saying upfront capital and financing costs make up 80 to 90 percent of the cost of solar power. It also said, according to the Wikipedia article, solar is expected to be the source of most new renewable capacity between 2022 and 2027, surpassing coal as the largest source of installed power capacity.

The article merchant states, “A photovoltaic power station, also known as a solar park, solar farm or solar power plant, is a large-scale grid-connected photovoltaic power system (PV system) designed for the supply of power. They are different from most building-mounted and other decentralized solar power because they supply power at the utility level, rather than to a local user or users. Utility-scale solar is sometimes used to describe this type of project.”

Individual homeowners also use solar panels. Ecowatch.com says the typical Alabama homeowner can find the panels pay for themselves in 11 years, while the national average is 12 years.

According to the Solar Energy Industries Association (seia.org), a trade association for the national solar industry, a solar installation in Muscle Shoals came online in 2021 and produces enough electricity to power more than 32,000 homes; Another in Montgomery can power more than 14,000 homes. Meta, Walmart and Toyota have solar installations in the state.

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