Using a Facility’s Location to Mitigate Socioeconomic Impacts

Depending on where a utility-scale solar facility is sited, the project will have different socioeconomic impacts on nearby urban areas. Several aspects of Nevada Solar One’s siting, such as distance to downtown and how the community utilized the site prior to facility construction, influenced how the project affected Boulder City. Drawing on these observations, one can infer how a proposed utility- scale solar facility would affect neighboring communities. These inferences suggest changes be made to the siting process so that facility impacts are mitigated.

Increase Community Distance from Facility
Several individuals interviewed for the Nevada Solar One Case Study noted that the solar facility’s construction likely had so few impacts on Boulder City because it was sited over 15 miles from the downtown area. As one community planner put it, the facility “is out in the middle of nowhere.” An employee of the utility purchasing Nevada Solar One’s power said, “If the project were closer it would have definitely had a greater impact on the town.”

Had the facility been closer, the socioeconomic impacts to Boulder City could have been very different. The hundreds of construction workers on site every day would have been able to go downtown for lunch, thereby stimulating demand at the local restaurants and stores. Public infrastructure could have been damaged, particularly if heavy construction vehicles had to drive local public roads to get to the facility. If the facility had been built closer to residents, there may have been negative impacts to the view. Workers driving to and from the facility might have caused traffic problems at certain times of the day.

Increasing the distance between the community and the facility may be a way to mitigate some of a facility’s negative impacts. However, as was the case for Boulder City, siting a facility farther from downtown may also decrease some of the facility’s positive effects. Ultimately, communities may find that avoiding negative effects outweighs the forgone benefits.

Consider Previous Land Use
Solar facilities may be sited to avoid affecting areas that are popular for recreation. According to a local planner, Nevada Solar One was built on land unpopular for outdoor activities, such as driving off- highway vehicles (OHV’s) and hiking. In contrast, a facility sited in an area popular with outdoor enthusiasts could draw backlash and be detrimental to the community’s quality of life.

For example, the facility near Lucerne Valley is proposed on land that the Bureau of Land Management (BLM) has not designated for recreation, though areas in the vicinity are used for hiking and off-highway vehicle use.¹ If these recreational areas are in the facility’s viewshed, they could be negatively affected. Imperial Solar Valley could also negatively affect recreation, as off-highway vehicle use is popular on the project site.²

Consider Implications of Landownership
In broad terms, Nevada Solar One’s lease payments, which add $700,000 each year to the city’s General Fund, have had a very positive fiscal impact on Boulder City. Specifically, the extra revenue has allowed the city to maintain a high level of services while keeping the tax burden low. Boulder City also benefits in small part from the property taxes Nevada Solar One pays to Clark County, a portion of which goes to Boulder City.

Generally, a solar facility sited on both public and private land will have greater direct fiscal benefits to the community than will a facility sited solely on federal public lands. It is unlikely that many municipalities and private landowners will benefit from lease payments or property taxes paid by new solar facilities sited solely on public lands. Although developers who build utility-scale solar facilities on BLM land will owe lease payments, this money will go into the general US treasury, as opposed to directly benefiting the local community. However, a developer whose site covers both public and private land will owe lease payments to the private landowner(s) as well. For example, the Imperial Solar Valley project site covers approximately 360 acres of private land.³

California and Nevada also have different laws for assessing solar infrastructure for property taxes, which has repercussions for how California municipalities may benefit economically from future solar facilities. Under Section 73 of the California Revenue and Taxation Code, developers who build utility- scale solar facilities in California are not assessed property taxes on their solar infrastructure.⁴ Since federal land is exempt from local property tax assessment, the code does not affect facilities sited solely on public lands. However, this law has implications for projects that span both public and private land. Solar developers with projects on private land will owe property taxes on buildings and other infrastructure not directly related to energy production, although the project’s assessed value drops dramatically when the solar infrastructure is excluded. This property tax exclusion does not carry over if a facility is sold; if the original project developer sells the facility to another entity, the facility’s solar infrastructure will no longer be protected from property tax assessment. In this case, the new entity will be assessed property taxes on the entire facility, which could translate into a significant amount of revenue for the county. Solar infrastructure could also become assessable if the tax exemption, which is set to sunset January 1, 2017, is not renewed.

Conclusion
Although there is a lack of academic research on the socioeconomic impacts of utility-scale solar development, there are many other sources of data with which to infer the impacts facilities will have in the California desert. A review of wind energy development suggests that solar development may have comparable socioeconomic effects. For example, like wind energy development, solar development will have minimal impact on job creation and population growth. An in-depth look at Nevada Solar One revealed that the facility had few long-term socioeconomic impacts, with the exception of annual lease payments. However, communities in the California desert will not benefit directly from lease payments paid by facilities sited on public lands. Housing and demographic data can help predict the effects of temporary construction jobs. Lastly, facilities should be sited in recognition of the role that location plays in mitigating facility impacts.

Given the range of potential impacts, the BLM does a good job taking into account the socioeconomic impacts utility-scale solar facilities may have. Among the developers Applications for Completion (AFCs) and Environmental Impact Statements (EISs) reviewed for this study, socioeconomic impacts were thoroughly addressed. The BLM should continue to support a process rooted in the National Environmental Policy Act (NEPA) in which such impacts are adequately addressed.

1 Ecology and Environment, Inc., “The Draft Environmental Impact Statement and California Desert Conservation Area Plan Amendment for the Proposed Chevron Energy Solutions Lucerne Valley Solar Project: Volume 1,” The California Energy Commission, http://www.blm.gov/pgdata/etc/medialib/blm/ca/pdf/cdd.Par.66057.File.dat....

2 US Bureau of Land Management and the California Energy Commission, “Staff Assessment and Draft Environmental Impact Statement:” C.10-2.

3 US Bureau of Land Management and the California Energy Commission, “Staff Assessment and Draft Environmental Impact Statement:”, ES-13.

4 US Bureau of Land Management and the California Energy Commission, “Staff Assessment and Draft Environmental Impact Statement:”, C.10-12