A former dump in Sterling could gain new life as the home of a renewable energy project.
On Tuesday, the Kenai Peninsula Borough Assembly approved a 25-year lease with Utopian Power, a Michigan-based renewable energy development company. Utopian approached the borough with the idea of converting a 40-acre disused waste processing facility into a 2-megawatt solar farm.
“We think this project can really take off and move forward, a project that makes a lot of sense for the peninsula as a whole, for the people,” said Forrest Cohn, founder and president of Utopian. He has worked in the area for years, with brief stints at the Cook Inlet Aquaculture Association and Midnight Sun Solar.
Utopian wants to generate electricity from the farm and sell it back to the local utility. Thanks to the new rental contract, the borough will receive a 12% royalty on each of these sales, in addition to annual rents of $10,000 to $250 per acre for a total annual rental amount of $10,000. Utopian will also have the option to extend its lease for two 10-year terms.
At present, the property does not bring anything to the borough. It actually costs them.
The Sterling Hazardous Waste Site, as it is known, is located off Swanson River Road. Due to underground waste, the solar project will be built entirely above ground, where the company plans to fill the development area with dozens of solar panels.
This will make it the biggest project Utopian has done to date – something that made Soldotna Assemblyman Tyson Cox nervous.
“Right now, the only project they’ve done is a one-megawatt solar farm. I just think there are a lot more questions than answers,” Cox said.
Cohn said the company has other big projects underway outside, though they’re still in their early stages.
Assembly members also questioned Utopian due to its non-compliance with Alaskan LLC, meaning they dropped Alaskan filing forms.
Cohn explained that Utopian is changing its status in the state. The company was founded in Alaska, he said, but eventually moved to Michigan. He said he was currently in the process of changing his record to become a foreign entity in Alaska.
The borough’s land management officer, Marcus Mueller, assured the meeting that the company’s compliance would be confirmed before moving forward with the project.
“We wouldn’t make a deal until that happened,” Mueller told the assembly.
Cohn said he was excited to bring renewable energy and economic development to the peninsula by repurposing the disused landfill site. He said he also hopes to use Alaska-based construction crews and materials to keep the project local.
Cohn owns a home in Kasilof and is a member of the Homer Electric Association. It’s the utility that Utopian hopes to sell power to — in the lease, Cohn asked the borough for three years to enter into an agreement with HEA to sell power.
“This is my home, my permanent residence,” Cohn said. “I would like to bring renewable energy to HEA.”
Cohn said the rising cost of natural gas mined at Cook Inlet is likely to affect the cost of electricity on the peninsula in the near future. These high costs are one of the factors that HEA has already cited to expand its renewable energy portfolio, with the aim of reaching 50% renewable energy by 2025.
“I think now is the time for projects like this to kick off,” Cohn said.
Utopian Power isn’t the only private company with plans to build a solar farm in Sterling.
Anchorage-based Renewable IPP also hopes to begin work on a separate solar panel park soon in sterling. The borough assembly created a new property tax exemption for independent power producers after this request, in order to encourage the development of renewable energies on the peninsula.
And now Assemblyman Brent Hibbert has said it might be time to review his property rental rates as well.
“Maybe we should think about it a bit more and have a policy,” Hibbert said.
Utopian says he would like to launch the project within the next three years. This will depend on a deal with HEA, which they say is being discussed.