November 23, 2010 / 8:18 PM / 9 years ago

First Solar plant approved by LA, overriding Northrop

LOS ANGELES (Reuters) - First Solar Inc won the green light for a 230-megawatt solar plant slated for California’s Antelope Valley after the Los Angeles County Board of Supervisors denied Northrop Grumman Corp’s appeal seeking to block the plant.

The plant, known as AV Solar Ranch One, would be a key part of First Solar’s plan to build up its plant development business, which provides a built-in market for the thin-film photovoltaic panels the company manufactures. But aerospace and defense company Northrop Grumman says the plant will get in the way of a sensitive radar-testing facility in nearby Kern County.

“We don’t oppose development of alternative energy,” Northrop spokesman James Hart told Reuters before the hearing. But he said the solar plant could interfere with readings at Northrop’s Tejon Test Facility, where workers place planes on poles and direct radar at them.

The controversy is the latest affecting the growing numbers of solar plants under development in California, which has ambitious renewable-energy goals.

Environmentalists and others are concerned about preserving habitats.

The Chumash Indian tribe recently filed a lawsuit against the U.S. Department of the Interior over its approval of a 709 megawatt solar plant from NTR Holding A/S’s Tessera Solar under development on the tribe’s ancestral lands in the Imperial Valley.

Northrop wanted to delay the plant to see if it could work with First Solar to find a way to build AV Solar Ranch that wouldn’t harm the test facility, Hart told Reuters. Northrop reached such an agreement with a wind farm in the area, he said.

“We’re disappointed,” Hart said after the appeal was turned down. “We’re looking at all our options.” To delay the plant now, the company would have to go to the courts, analysts say.

The county plans to issue a conditional use permit for the plant early next month.

First Solar spokesman Alan Bernheimer told Reuters the company planned to begin construction by year-end if Northrop’s appeal were denied. However, it still needs a couple of minor permits, such as a grading permit, which Bernheimer said First Solar could secure in the next few weeks.

“They’re going to have to get all their ducks in a row,” Wedbush analyst Christine Hersey told Reuters. “But if they hustle, they can start construction this year.”

By beginning construction by December 31, First Solar would qualify for a U.S. Treasury Department grant covering 30 percent of construction costs.

Construction would employ some 400 workers in the depressed Antelope Valley area, First Solar officials say.

The strategy of building up plants gives First Solar some protection against what analysts say will likely be falling prices for solar panels next year, as competition in the sector heats up, especially from low-cost Chinese manufacturers.

It’s a strategy also pursued by rival panel maker SunPower Corp, which like First Solar is building out a portfolio of ever-larger plants. SunPower’s 250 megawatt California Valley Solar Ranch is under development in San Luis Obispo County.

Northrop also protested a nearby Kern County solar plant under development by Sempra Energy, which it also said would affect Tejon, but Kern County officials approved that plant earlier this month.

Last year, California utility PG&E Corp agreed to purchase the AV Solar Ranch One’s output, which is enough to power 23,000 homes. The plant is expected to start generating electricity next year.

The Antelope Valley plant would be First Solar’s largest in California. It is also due to start construction this year on the 290-megawatt Agua Caliente plant in Arizona.

Reporting by Sarah McBride; Editing by Gerald E. McCormick

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