Threat of Industrial Solar Remains High in 2024

Federal subsidies and legal exemptions for electric utilities prop up the threat of industrial solar.
Clark Coalition Staff
March 6, 2024

Early last year, we received a report that East Kentucky Power was seeking to pursue the industrial-scale solar projects that we have opposed in Clark County since 2020.


We published an OpEd to assert that EKPC should respect Clark County’s planning process and the voice of its citizens who overwhelming oppose industrial solar in our Agricultural Zone. While EKPC has not publicly responded to that call, we have continued to seek out information about its plans.


Applying for Federal Handouts

Perhaps the most significant driver of large-scale solar development are massive federal subsidies. The Investment Tax Credit first created in 2005 and subsequently extended four times, has provided solar developers with a 26-30% rebate on the cost of their projects at the expense of US taxpayers.


This tax credit has not been available to tax-exempt utilities. However, under a program created by the Biden Administration’s 2022 Inflation Reduction Act, electric utilities, like EKPC, can receive a direct payment from the federal government for 25% of a solar project’s costs.


The Empowering Rural American (New ERA) program essentially extends the Investment Tax Credit to entities that do not pay federal taxes.


In order to be eligible to apply for the federal funds, utilities were required to submit a Letter of Interest (LOI) by September 15, 2023. Clark Coalition filed a request under the Freedom of Information Act (FOIA) to obtain the Letter of Interest and associated documents regarding EKPC’s plans to build industrial solar facilities, or contract with solar developers.


Unfortunately, the information we received was heavily redacted.

Here’s what we do know: 

–       Descriptive Title of Applicant’s Project: EKPC’s Renewable Integration and Energy Efficiency Portfolio of Actions

–       The proposed project start date: 3/1/2024

–       The amount of federal funding EKPC is applying for: $970 million, which represents 10% of the total program’s$9.7 billion

–       Four pages with details of the project locations were entirely redacted

What about Clark County’s Solar Ordinance?

In response to a state law that would have limited local control of solar siting and regulation, the Clark County Fiscal Court passed an ordinance in June 2023 to protect agricultural land from large-scale solar development.


However, the ordinance would not apply to EKPC as it is regulated by the KY Public Service Commission, and is exempt from local ordinances under KRS 100.324.  


What Comes Next?

It is not certain that EKPC will receive federal funding. The New ERA program received 157 proposals from across the country for more than 750 renewable energy projects. This totals nearly 2.5x more than the program’s allocated funding of $9.7 billion.

Also, EKPC would still have to apply for a Certificate of Public Convenience and Necessity with KY Public Service Commission. This process can last months and includes legal proceedings, expert testimony and public comment.


We will continue to monitor the situation and inform you of potential action steps.

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