An old dump in Sterling could gain a new life as the home for a renewable energy project.
On Tuesday, the Kenai Peninsula Borough Assembly approved a 25-year lease with Utopian Power, a renewable energy development company based in Michigan. Utopian approached the borough with the idea to convert a 40-acre decommissioned waste facility into a 2-megawatt solar farm.
“We believe this project is one that can really take off and move forward, one that makes a lot of sense for the peninsula as a whole, for the people,” Forrest Cohn, the founder and president of Utopian, said. He’s worked in the area for years, in brief stints at the Cook Inlet Aquaculture Association and at Midnight Sun Solar.
Utopian wants to generate power from the farm and sell it back to the local utility. Through the new lease agreement, the borough will receive a 12% royalty from any of those sales, in addition to annual rent payments — $250 per acre for a total annual lease amount of $10,000. Utopian will also have the chance to extend its lease for two 10-year terms.
As it stands, the property isn’t making any money for the borough. It’s actually costing them.
The Sterling Special Waste Site, as it’s known, is located off of Swanson River Road. Because of the waste underground, the solar project will be constructed entirely on the surface, where the company plans to fill the development area with dozens of solar arrays.
That will make it the largest project Utopian has done to date — which made Soldotna assembly member Tyson Cox nervous.
“Right now, the only project they’ve completed is a one-megawatt solar farm. I just think there’s a lot more questions than answers,” Cox said.
Cohn said the company has other large projects in progress Outside, though they’re all still in early stages.
Assembly members also cast doubt on Utopian due to its Alaskan LLC non-compliance, meaning they lapsed on filing forms in Alaska.
Cohn explained that Utopian is in the process of changing its status in the state. The company was founded in Alaska, he said, but eventually moved to Michigan. He said he’s currently in the process of changing its filing to be a foreign entity in Alaska.
Borough Land Management Officer Marcus Mueller assured the assembly that the company’s compliance would be confirmed before moving forward with the project.
“We would not enter into an agreement until that happened,” Mueller told the assembly.
Cohn said he’s excited to bring renewable energy and economic development to the peninsula by repurposing the decommissioned dump site. He said he’s also hoping to use Alaska-based construction crews and materials to keep the project local.
Cohn owns a home in Kasilof and is a member of Homer Electric Association. That’s the utility Utopian hopes to sell power to. In the lease agreement, Cohn asked the borough for three years to strike an agreement with HEA to sell power.
“That’s my home, my permanent residence,” Cohn said. “I would love to bring some renewable energy to HEA.”
Cohn said that the rising cost of natural gas extracted in Cook Inlet is likely to affect the cost of power on the peninsula in the near future. Those high costs are one factor HEA has already cited for expanding its renewables portfolio, with the goal of reaching 50% renewables by 2025.
“I think the time is now for projects like this to get off the ground,” Cohn said.
Utopian Power isn’t the only private company with plans to build a solar farm in Sterling.
Anchorage-based Renewable IPP is also hoping to start work on a separate solar panel farm there soon. The borough assembly created a new property tax exemption for independent power producers after that request, to incentivize renewables development on the peninsula.
And now, assembly member Brent Hibbert said it might be time to take another look at its property leasing rates, as well.
“Maybe we should think about this just a little bit more, and have a policy,” Hibbert said.
Utopian says it would like to break ground on the project in the next three years. That will depend on an agreement with HEA, which they say is under discussion.
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