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November 7, 2023Episode 70. Can Solar Panels in Highway ROW Be the Next Big Step in Renewable Energy?
FEATURING: Brianne Glover, Edgar Kraus
In using roadsides for the collection of solar power, can we succeed in achieving both environmental and economic goals? It all depends on how you define “success.”
About Our Guests
Senior Research Scientist
Brianne Glover is manager of TTI's Infrastructure Investment Analysis Program. She is also an attorney and counselor at law licensed to practice in Texas. Brianne has been involved with numerous research projects for various sponsors that focus on transportation financing, as well as the economic impacts associated with transportation improvements.
Edgar Kraus works in TTI's Utility Engineering Program in San Antonio and has been conducting research in the area of utilities and right-of-way for more than 20 years. He has provided leadership on numerous state and national research initiatives dealing with utilities and right-of-way issues in the transportation project development process. Mr. Kraus lives with his wife and three children in San Antonio, Texas.
Bernie Fette (00:16):
Hey everybody, and welcome to Thinking Transportation. Conversations about how we get ourselves and the stuff we need from one place to another. I’m Bernie Fette with the Texas A&M Transportation Institute. If you’ve ever noticed the big empty spaces alongside major highways and wondered, why doesn’t someone do something with all that unused real estate, there’s a good chance you’ll be interested in today’s conversation. As some states are learning, those expanses might be ideal places to install solar panels, helping cities meet an ever-growing demand for electrical power. That’s our topic on this episode of Thinking Transportation. To help us understand, we’re joined by Brianne Glover, a senior research scientist in TTI’s Freight and Investment Analysis program, and Edgar Kraus, a research engineer in the agency’s Utility Engineering program. Brianne and Edgar, thank you so much. Welcome to the show and thanks for joining us.
Edgar Kraus (01:25):
Yeah, glad to be here. Thank you.
Brianne Glover (01:27):
Bernie Fette (01:28):
So examining the issue of utility installations in highway rights of way, I know that that’s not really a new thing for TTI, but there’s a distinction here in this case, if I understand correctly, that it’s not just electric power transmission lines that we’re talking about in those spaces, but it’s also the actual production of electric power in those rights of way. Am I describing that accurately?
Edgar Kraus (01:55):
Yeah, that’s exactly right. So we’re talking about the utility scale production of electric power in the right of way using state and federal right of way for the production of that power.
Bernie Fette (02:09):
Let’s then start with the reason behind your work. Why did the state of California want to do this research? What was it that the officials there were hoping to learn?
Edgar Kraus (02:19):
So I think it was due to the experience they had with some projects that didn’t turn out as well as they thought they would. So I think California Department of Transportation had a lot of experience building small scale solar facilities just to power local units or local buildings, facilities like traffic lights and so on. But when they wanted to go to the utility scale production of power, they ran into a host of problems and I think they had to cancel one project or didn’t move forward as they thought it would. And that’s why they brought forth this project and asked some researchers to look into the overall topic.
Bernie Fette (02:59):
And just so I understand, when you mention utility scale, is that at a level that would actually produce for numbers of customers as opposed to just a immediate proximity application, like a traffic light or something like that?
Edgar Kraus (03:16):
Yeah, exactly. So the power that’s produced in the location goes beyond the need of that location.
Bernie Fette (03:21):
I see. Okay. I think you were about to jump in there, Brianne.
Brianne Glover (03:25):
Yeah, and I’ll just add that it sort of goes back to this thing called renewable portfolio standards. And so that’s sort of a mandate that a certain percentage of energy be generated from a renewable source. And so California has this RPS, this renewable portfolio standard, there’s many other states, 27 I think, plus D.C. At the time that we did this research. They also had these renewable portfolio standards in place at the time.
Bernie Fette (03:53):
One of the first questions that occurred to me as I was reading about the work that you and your colleagues did, it has to do with what kinds of laws or restrictions there are for how that space can be used. So in a highway right of way, what uses are permitted and which uses are not?
Edgar Kraus (04:11):
So when we talk about putting utilities into the right of way, um, there is, you know, typically two ways you can do that, especially when it comes to federal right of way. So the rules for utilities and state highway are a little bit different, but if we’re talking about interstates and federal highway, there’s two ways. And one is you can accommodate as a utility or you can accommodate as an alternative use. And based on what you choose, you have a totally different approach to what needs to be done and what needs to be worked out and how the whole process moves forward.
Brianne Glover (04:48):
And I think that comes down to, you know what Edgar just said that is it a utility? And I think that’s one of the biggest questions. Not all states consider these, you know, solar facilities a utility. And so I think that’s kind of the first question that has to get asked is, is it a utility?
Bernie Fette (05:06):
And the restrictions, the laws that we’re talking about, those are federal statute I guess.
Edgar Kraus (05:11):
Bernie Fette (05:13):
So why is this a good idea? What are the advantages to siting solar panels in highway rights of way as opposed to other tracts of land?
Edgar Kraus (05:23):
I think that the consideration was that the land is there not being used to its full potential. And that’s why I think Federal Highway Administration came up with this idea of alternative use or basically we have a statute that says we can use the right of way in a different way than it was actually thought to be used in the beginning. Because when the right of way was purchased, it was purchased to provide transportation to American citizens, right, to the people in the traveling public. Now if we use it in a different way, we have to be careful that we don’t impact that initial use for the right of way. So it can’t really affect the highway or the traffic safety. It should also not impair the aesthetic quality of the highway. So those are considerations that need to go into this before we can start building those facilities.
Bernie Fette (06:21):
And when we say right of way, in this case, it’s, most of the examples that I’ve seen anyway are at an interchange so that you have not only the right of way that it’s adjacent to two major roadways, but you’ve got this almost triangular section of land that is bordered by the two major roads plus a exit or entrance ramp. Do I have that right?
Edgar Kraus (06:46):
Yeah, there’s several examples of that, but we really consider any type of right of way. So I think California transportation, the Department of Transportation was interested in actually putting solar facilities along a highway.
Bernie Fette (06:59):
Edgar Kraus (07:00):
And when they first came up with that idea, I think they wanted to accommodate as an alternative use. So they said this is not really a utility. We don’t really have a a definition yet for a solar facility as utility in our state rules utility accommodation rules. So we’re going to just accommodate as an alternative use. And if you do that, then different set of rules apply. And at the time of their moving forward this project, there was a requirement that you get the fair market value if this is a third party, installing certain facilities in the right of way. And that really created a lot of problems.
Bernie Fette (07:43):
I think we were just talking about advantages to siting the panels in these land sections. What about the challenges? What are the big challenges that are fundamental in an undertaking like this one?
Brianne Glover (07:56):
So from a contracting perspective, it can get a little complicated. There’s three parties involved. You’ve got the state because they’re the owner of the right of way. You’ve got the say contractor or the private party that would be installing it and possibly operating it. And then thirdly, you’ve got the utility company itself that is going to be, you know, receiving the power and then sending it back out to the public at large. And so there’s this thing called power purchase agreements that are typically in place. And so it’s just another layer sort of of contracting that has to be um, involved.
Bernie Fette (08:33):
So apart from the complexity, what other kinds of challenges would projects like this face?
Edgar Kraus (08:39):
Well, in addition to those, I would say just this particular site challenges. So you know, you may have a site that is not as easy to develop or you may have neighbors who would not like to see a field of solar installations right up front their house. So there’s also considerations about glare. Um, some, um, in some cases we heard that there was a glare at certain times of the day that would impact the traveling public. So there’s all kinds of considerations that need to go into setting up a site.
Bernie Fette (09:15):
Which would seem to be unusual. The glare that you’re talking about Edgar, because aren’t these panels designed to attract sunlight as opposed to reflecting it?
Edgar Kraus (09:26):
Yeah, it, I don’t think those considerations weren’t as important or as difficult to overcome because once somebody really wants to develop a site, that’s the homework that they do. They figure out the best sites that they can use and they avoid these issues. But at the very beginning those were things that we looked into that we came across.
Bernie Fette (09:46):
I see. I noticed in your work there’s a lot of attention that you paid to best practices. So what were the lessons that you learned in your examination of how this is being done in other states?
Edgar Kraus (09:59):
I would say that the biggest thing that I personally learned is that it’s very important to define what is success for your solar installation in your particular case. So we came across examples where, you know, a state just wanted to reduce the greenhouse gas impacts on their state. So they just wanted to basically take advantage of the renewable portfolio standards. And if you do that, it doesn’t really matter if your site generates funding for the state because you are contributing uh, to the reduction of greenhouse gases in other states. It was important for the facility to generate revenue. In that case it might be difficult to do this or not. In other cases, they just wanted to show that there is a research project and they wanted to show that it is feasible to put these sites in the ground and actually generate revenue from them. So it’s very important to define what the success is for a particular site.
Bernie Fette (11:04):
How might this idea get us farther down the solar power adoption path as a country?
Edgar Kraus (11:12):
That’s a good question. Difficult question. I think in Texas for example, we have like plenty of land, right? Where we could install acres and acres of solar facilities, but there may not be in areas where there’s interconnection available or readily available. So along the
Bernie Fette (11:27):
Proximity to the grid, in other words.
Edgar Kraus (11:28):
Bernie Fette (11:29):
Edgar Kraus (11:30):
The right of way goes all through Texas and it goes through locations where people live and where utilities already have facilities and where the connection to the grid is a lot easier to achieve. So from that perspective, that area of land is already more desirable to develop.
Brianne Glover (11:48):
To add to that. So I focus mostly on the rules and regulations, but you know, the things that we have in place right now in most states are focused on residential use. Primarily residential use of solar panels and that sort of thing.
Bernie Fette (12:01):
Just solar panels on people’s roofs?
Brianne Glover (12:04):
Yeah, exactly. Okay. And so I think as we get sort of more comfortable with this idea and we start seeing it implemented more that the rules will be shaped and become a little more clear and maybe more consistent across the states as well. And so I think that it’s kind of a work in progress on that end.
Edgar Kraus (12:23):
In other states, the renewable portfolio standards create a need or like some sort of pressure to do this kind of development. It makes it easier to develop solar facilities. Then there’s a market to exchange the credits that are developed by these facilities. I think in Texas we’ve already reached all the goals, the renewable portfolio sense, we reached ’em a long time ago. So there’s not really that benefit of developing those types of facilities. And there’s also tax credits, federal tax credits that have expired, but there might be others coming up in the future. So it is very important to see the whole picture when you develop like what benefits exist and who can take advantage of it.
Bernie Fette (13:06):
You were mentioning benefits Edgar, I wonder, isn’t it true that one of the benefits here is that there’s a potentially sizable payoff long term in investments like this? Is that correct?
Edgar Kraus (13:19):
Yeah, it all depends. For example, okay, um, if you have to pay for, if you, you’re on a utility and you would like to use that right of way, but you have to pay the fair market value to install your facilities, then it’s pretty much not going to be a viable project because it is too expensive to buy the land. Okay. But on the other hand, if the says, Hey, we already allow utilities, right? Because it’s a public use, we all benefit from that. You and I, everybody uses electricity and it’s a public use, therefore it’s a benefit. We will allow the utility to use the right of way for free if the utility then produces this electricity and puts it in the network and therefore everybody benefits, that’s a totally different situation because then they don’t have to pay for the land and therefore it might be a viable project.
Brianne Glover (14:13):
And so that, you know, circles back to that, is it a utility? And so yeah, it may be beneficial and some states and not so much in others.
Bernie Fette (14:23):
I’m wondering if it’s possible to draw a comparison here with on one side the setup costs for a large utility scale solar panel installation and the construction of a natural gas power plant, assuming that each is equipped to produce roughly the same amount of electricity, is it possible to look at a comparison like that?
Edgar Kraus (14:50):
I think that’s a difficult comparison. I think you would need a lot of space just to come close to the energy that’s produced by like a power plant. But just to give you an idea that one of the uh, projects that we looked into in Florida, they had set up solar facilities in the right of way and they really wanted to produce energy using solar cells just to showcase the possibilities of the technology. And they also wanted to generate a little bit of income doing that. It turned out however, that the space where they installed it became so valuable for other users in particularly in this case it was like truck parking. Mm-Hmm <affirmative> that they just decided to take it out after a couple of years because they needed the space for different users. So that’s why I said earlier that it’s really important to define from the get go, what does the success look like. If you’re just focusing on revenue, then there’s often different users that are actually better or higher use for, for that location.
Bernie Fette (15:54):
Speaking to what you just mentioned about how to define success, Edgar, that whether or not an investment like this is worthwhile all depends on once again why you’re trying to do it.
Edgar Kraus (16:07):
Brianne Glover (16:09):
Yeah. If you’re trying to meet environmental standards, it’s great. If you’re trying, like you said to you know, generate revenue, then it may be a different conversation
Bernie Fette (16:17):
And it all depends on the different factors. And there’s a series of moving parts here in this conversation. It sounds like just like, just like there’s a series of differing factors in whatever equation you’re trying to work out.
Edgar Kraus (16:30):
Yeah, like Brianne was saying, if it’s a third party who develops the site, then you have a power purchase agreement. Usually that’s an agreement between the developer and the DOT or somebody else who uses the power to purchase the power for a certain amount of time at a certain rate. So that’s allows basically the developer to take advantage of the tax benefits and other benefits and it allows the DOT to, you know, make the right of way available and make the whole project financially viable. But we found that by the time that we did the research, there were many states that didn’t allow power purchase agreements. So that kind of takes away that ability to move forward with the project on these terms.
Brianne Glover (17:15):
Yeah. So without that agreement, it would have to be the state itself, you know, that was putting in the facility and operating it. And that’s not usually the case in a lot of these.
Bernie Fette (17:24):
And it calls into question the appropriateness of a state government going into a business like that, does it not?
Brianne Glover (17:31):
I think so, yeah.
Bernie Fette (17:33):
Yeah. You mentioned earlier people developing or institutions developing a comfort level with this Brianne, uh, people getting comfortable with the idea. What sort of obstacles to acceptance do you see in applications like this? Apart from I think that Edgar, you were mentioning one that people may not want to have solar installations next to their homes, but I’m wondering from the perspective that each of you might have, what are those obstacles to public acceptance?
Brianne Glover (18:04):
Yeah, that NIMBY not in my backyard is always high on the list there, but I think some of the others, at least from the legal side of things, you know, we mentioned the contracting, those power purchase agreements, there’s also rules and regulations that have to do with net metering and the interconnection back to the grid itself. You know, you have to be very careful with that and how that works out. And, and again, that comes back to each state kind of handling it differently and their utilities handling it a little differently. So I think that’s sort of the biggest one from my perspective.
Edgar Kraus (18:37):
Yes, especially in California, there’s this electric rule 21 that governs how interconnections are done in the state of California or, or most of the state at least, but it turns out that each major utility has its own version of how they’re implementing that rule. So depending on where you have the location, you may have a totally different rule on how to move forward with that project.
Brianne Glover (19:02):
So yeah, I think until these sort of become a little more universal, at least within a state, it makes it a little more difficult.
Bernie Fette (19:10):
We touched earlier on how at least in some ways this is a relatively new topic of study for TTI. Were there any surprises along the way in this particular project?
Edgar Kraus (19:23):
Well, I would say it was a little bit surprising to me that there’s a lot of regulations out there right now, but they are really targeting the residential solar market. Mm-Hmm. <affirmative>. So when it comes to, uh, utility scale, the large scale, a non-residential solar market, it is, you know, not as well regulated as the residential solar market. And that leads to those issues that we mentioned where you really have to deal with a whole set of rules that may be very specific to the location that you’re dealing with.
Bernie Fette (19:58):
And it sounds like this is yet another case where in the absence of a lot of those regulations, knowing how you define success becomes even more important.
Edgar Kraus (20:09):
Bernie Fette (20:10):
Given what you’ve learned in this exercise, could you both talk just a little about the direction of research on this front? If you wanted to take a next step and another research sponsor handed you a generous bit of funding, what would that step look like? What questions would you think are most important to answer at this point?
Edgar Kraus (20:30):
I think a big question is how we’re dealing with transmission lines on interstate right of way. And a big question is there how states are going to allow those transmission lines if they don’t see a distinct benefit to their state or to their region? So typically utility lines like transmission lines or other utilities are not allowed on interstate highway, but there’s a lot of pressure from utilities to use that, especially for the provision of electricity to electric vehicles. So the question will become how are we dealing with that issue and what can we do to basically improve electric transmissions or large distances using interstate right of way?
Brianne Glover (21:18):
Yeah, and to that end too, you know, these rules are changing so quickly, especially in this environmental field, EVs, they’re constantly changing and progressing and these sort of standards that states have as far as what their green energy is gonna look like. And so I think it’s just changing so rapidly that as soon as you’re done with some of the research on this, it’s, you know, time to continue to look at it again.
Edgar Kraus (21:43):
We basically created what they called a yellow book, basically an overview of what you need to know in order to move forward with utility scale, solar project development in the right of way and specific to California. But a lot of these rules are, you know, federal, so they apply to the whole country, but we have never really gone further and provided more detailed information or guidance to develop projects in specific locations. So to me, that’s like the next big step to provide guidance on how to really attack now that we know how to move forward, how to actually do this, how do we determine what locations are best for those projects and move forward with those projects in those locations.
Bernie Fette (22:27):
Last question. What more than anything motivates you to show up to work every day? Long pause, <laugh>.
Edgar Kraus (22:39):
I need to think hard about this. I think in my case, just making a difference, creating a benefit for the people and seeing the impact that you, um, create. I just enjoy working with, uh, people at the Department of Transportation and seeing how they struggle, um, to provide, uh, a good transportation system, then helping them out and making a real difference. And if I can see that what I come up with, the research that I develop, if I can see that makes a real impact, you know, that to me is really rewarding.
Brianne Glover (23:17):
So on my end, I’d say just the research itself, it seems to be changing so much recently that, you know, there’s always something new. It’s like every day we dive into sort of a different topic and so that makes it really exciting to not get into a rut and to be able to continue to advance our research and to different topics, especially on the legal front.
Bernie Fette (23:37):
Never a dull moment. Yeah. Brianne Glover is a senior research scientist in TTIs Freight and Investment Analysis program, and Edgar Kraus is a research engineer in the agency’s Utility Engineering program. Brianne, Edgar — really enlightening stuff. Thank you so much for sharing your story with us.
Edgar Kraus (23:59):
It was a pleasure. Thank you.
Brianne Glover (23:59):
Bernie Fette (24:02):
Departments of Transportation have some experience in building small scale solar power installations along roadsides for small scale facilities, traffic lights, for example, but more ambitious installations. Those that can power hundreds of homes and commercial buildings. Those involve lots of challenges. Site logistics and contracting alone for such installations can get pretty complicated, but emerging research can help us to light the way in meeting our growing need for a reliable supply of electrical power. Thanks for listening. Please take just a minute to give us a review, subscribe and share this episode, and please join us next time for a conversation about getting ourselves and the stuff we need from point A to point B. Thinking Transportation is a production of the Texas A&M Transportation Institute, a member of the Texas A&M University system. The show is edited and produced by Chris Pourteau. I’m your writer and host, Bernie Fette. Thanks again for joining us. We’ll see you next time.