The Georgia Power Advanced Solar Initiative offers solar developers the opportunity to bring solar arrays to market through a competitive bid process. Client Beltline Energy won the bid to build a 3MW solar farm in rural Tattnall County in southeast Georgia. Arnall Golden Gregory advised on structuring a deal that benefited both the developer and the community.
Beltline Energy sold 2MW of the project to investors, who formed the special-purpose entity Fulton Mill Solar Farm LLC, and kept 1MW operated by the client’s special-purpose entity, Curry Solar Farm LLC. Arnall Golden Gregory negotiated with two lenders to fund the entire 43-acre project. AGG also reviewed the power purchase agreement with Georgia Power, the largest Georgia electric utility owned and operated by Southern Company. Georgia Power agreed to buy both entities’ electrical output for 30 years. AGG also negotiated with local authorities a time-limited, performance-based property tax abatement, which was necessary to make the project feasible. Using several financial models, AGG helped show the county, the local school board and the development authority how approving the 16-year tax abatement would be a financial windfall for the community. The taxable value of the sandy timberland without the project was only a couple hundred dollars. A solar farm increases tax revenues 10 times to 20 times without burdening the local government with any expense to support the project. During the tax abatement period, the client’s equipment is depreciated so that when the abatement expires, the client is paying taxes on the equipment’s residual value, which is about 20 percent of the original value.
The project created construction jobs for local workers in need of jobs, who made purchases at local businesses. While a solar farm creates few if any direct permanent jobs, it also does not create expense to the host community, such as new infrastructure. In short, the solar farm is found money for the host community. Solar projects such as this one also chip away at the nation’s reliance on polluting fossil fuels.