Minnesota Courts Hear Farmland Solar Power Challenges

Recent decisions from state appeals courts are beginning to shed light on how far Minnesota counties can go to limit solar development on farmland.

The Minnesota Court of Appeals recently ruled in three cases involving rural counties that rejected developers’ plans to build community solar farms. The court has rejected McLeod County’s denials twice in the past year, although last month it upheld Stearns County’s right to deny a solar project.

The cases reflect growing tension between the solar industry and rural county officials who fear solar power will lower property values, destroy agricultural landscapes and potentially harm livestock.

“There’s kind of a continuing evolution — and we’re seeing it in Stearns County, in particular — of an attitude that sees solar power as having an impact on rural character,” said Brian Ross, vice -Chair of Renewable Energy for the Great Plains Institute.

This is not a new problem. The appeals court has ruled in at least two other community solar farm cases since 2017, both in Carver County. One affirmed the right of the county council to deny a developer a conditional use permit; the other reversed its decision against a solar farm proposal. But conflicts are occurring more often due to the growing number of projects, said Ross, who has worked with communities on solar zoning issues for several years.

The Stearns and McLeod cases had similarities, with both counties arguing that community solar farms would be on prime farmland after developers applied for conditional use permits.

The McLeod County Board of Directors voted 3-2 against a plan by developer US Solar for a small 500-kilowatt community solar farm, even though council members acknowledged the conditional use license application met its criteria. The court quashed the suit in July 2021, finding the county failed to prove several of its claims about the garden’s negative impact on surrounding land values. He also wondered if the property could be defined as “prime agricultural soil”.

This year’s appeal case overturned McLeod’s rejection of another US solar project seeking conditional use permits for two solar farms on 17 acres. The issues were largely the same as the first, except the county raised greater concern about stray voltagein which electrical currents leak from damaged equipment or power lines, potentially affecting animal health.

In 2020, solar developer Impact Power Solutions (IPS) applied to Stearns for a conditional use permit to lease 7.5 acres of a 113-acre parcel in Paynesville Township for a 1-megawatt solar garden. The site was adjacent to another solar farm and within a mile of four other solar projects. Stearns County commissioners denied the request, prompting an appeal from the solar developer.

The difference in the Stearns County case was that it had already established a rule in its overall plan allowing commissioners to preserve farmland even when a claimant meets other conditions, Ross said. The land was also zoned agricultural, so the developer needed a conditional use permit. The court rejected IPS’s argument, agreeing with the county that the property was farmland, and used legally sufficient reasoning to deny the conditional use permit.

The Stearns County Comprehensive Plan encourages solar development in certain areas. The county has a well-established and progressive solar policy in a case study by the Great Plains Institute. The wording of the comprehensive plan supporting solar and primary agriculture led judges to “defer to [the county] because they did all their procedures right,” Ross said.

Ross thinks what’s happening in Stearns and McLeod counties could be a harbinger of trouble. Xcel Energy, which runs the community solar program, has a backlog of dozens of projects awaiting approval that would add more than hundreds of megawatts of electricity to the grid. The utility intends to build thousands of megawatts, some on its own land, but it may need to lease property for projects.

Both counties have started to see solar projects cluster near interconnection points, Ross said. This is partly the direct result of a state rule limiting community solar sales to residents living in the county where the solar is located or in adjacent counties. This sparked a wave of projects in counties near urban centers with available land. St. Cloud is the county seat of Stearns, while McLeod is just outside the Twin Cities metropolitan area.

The Minnesota Solar Energy Industries Association lobbied the Legislature to change contiguous county regulations to allow for a larger geographic footprint for community solar power. Logan O’Grady, the association’s executive director, said when counties kill solar projects, they lose the potential for well-paying jobs and leave developers with wasted hours.

It’s also arbitrary, he argues. “Stearns County’s decision means that approval of solar projects continues to be decided not on the merits of projects but rather on the political views of changing elected councils,” O’Grady said. “For every industry, not just solar energy, the process of implementing and authorizing a project must be stable, predictable and fair. These processes should not change with the elections.

Eric Pasi, director of development at IPS, said the Stearns case raised issues commonly encountered by developers in rural areas. “Many jurisdictions in Minnesota and across the country are concerned about land use, especially in areas where agriculture is dominant,” he said. Yet research has shown that the state could meet 70% of its energy needs with solar power using only 0.4% of agricultural landsaid Pasi.

A growing number of solar farms are employing “dual-use” strategies by hosting pollinator habitats or agrivoltaics that combine solar power and agriculture, Pasi said. Solar can help “heal and restore the land by not cultivating or using pesticides continuously,” he said, using native vegetation. However, projects with these assets do not always convince county councils who are debating whether to grant them conditional use permits.

Ross predicts that the problem will eventually resolve itself as more communities see the benefits of solar power and its importance in decarbonization. Given that only a few counties are near Stearns’ level of solar activity — which has dozens of pending solar farm applications — he doesn’t think others will copy his conditional use license language.

McLeod County Commissioner Nathan Schmalz represents the township where US solar projects are being built. After hearing about how Stearns regulates solar farms, he hopes McLeod could incorporate a similar approach into his overall farmland protection plan.

McLeod adds setback regulations for solar farms and requires interconnection agreements before adjudicating conditional use license applications. Schmalz said landowners have started to voice concerns about having too many solar farms and the council is worried about the loss of farmland.

McLeod has approved many solar projects, he said, but at least six that have been approved have not started due to supply and labor issues, he said. Community solar power lost some of its appeal to county officials when regulators limited community solar power to 1 megawatt, a limitation that eliminated the tax on solar power generation that farm owners solar pay to counties, Schmalz said.

Now the county council’s attention has shifted to working with US Solar to ensure the company has enough bonding to decommission McLeod’s solar facilities when the time comes. “There are so many unknowns and it’s hard to put a value on something that will be downgraded decades from now,” he said.

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