Tribal Money

Tribal communities use corporate investment for solar power

Jhe first large-scale solar power plant on tribal lands in the continental United States began operation just five years ago. Built on some 2,000 acres on the Moapa River Indian Reservation in Clark County, Nevada, the 250 megawatt project provides enough electricity for more than 100,000 homes each year; all electricity generated is sold approximately 300 miles to the Los Angeles Department of Water and Power. Over the next two years, two more large-scale projects led by Moapa will come online – at 500 megawatts combined, the additions will be among the largest yet on tribal lands.

While the first project benefited from a $2.38 million grant of the Ministry of Agriculture, these solar farms would probably not have been possible without a numerous partnerships with energy companies. The result is millions of dollars in tribal revenue as well as stable clean energy jobs. Increasingly, tribes across the country have started thinking big about solar. Pressured to accelerate clean energy development, private companies and individual entrepreneurs are finally investing in Indigenous-led solar projects. Although such projects are and will remain under the control of indigenous communities, private capital is essential to allow tribes to seriously exploit their renewable resources.

Tribal lands make up about 2% of the United States, but hold 5% of all renewable energy resources in the country, according to a 2013 study commissioned by the Office of Indian Energy of the Department of Energy (DOE). This includes approximately 14 billion megawatts of potential electricity generation from utility-scale rural solar resources, or 5.1% of the total potential in the United States.

Today, as dozens of tribal communities across the United States are equipped with rooftop or community-scale solar panels (with more than a dozen other projects underway), tribes wish to increasingly expand to utility scale and enter the energy market. But while government grants often help kick-start tribal renewable projects, it’s not enough to keep them growing.

The difference in financing between large-scale solar projects and individual local projects is profound. Rooftop and community solar power is quite expensive, costing a few million dollars. Large-scale behemoths can run into the hundreds of millions. To get there on government funding alone would require a seismic shift in congressional appropriations to cover the cost of everything from transmission line access to workforce training. “I think Congress needs to appropriate a triple amount of investment in Indian Country just to achieve these goals and to get to where we need to be for climate change,” says Tim Willink, Tribal Solar Program Director at GRID. Alternatives, an environmental justice nonprofit that offers training and installation of solar power systems to underserved communities. Instead, many tribes turn to philanthropy and corporate investors.

Renewable energy appeals to tribal communities for a number of reasons: it offers self-sufficiency, reduced energy costs, economic development and the ability to adapt to climate change. Since 2010, DOE has distributed 214 grants for green energy projects, totaling more than $85 million to 147 Tribal Nations, Alaska Native Villages and Corporations, Tribal Utilities, Tribal Businesses, and Tribal Nonprofit Organizations . Regardless of the size of the project, competition and obtaining funding has long been a challenge. When it comes to rooftop solar, for example, unlike most other communities in the United States, tribes are not eligible for federal tax credits to reduce the initial cost of such projects. That means that since 2013, tribes have lost the direct benefit of $4 billion in state-distributed rebates and $15 billion in federal tax credits, according to a report. 2022 DOE Study. Instead, study notes, tribes, and nonprofits must partner with third-party investors who may receive these tax credits such as nonprofits and private investors.

GRID Alternatives has worked with about 50 tribal nations to provide technical support, and the organization knows all too well the difficulty of seeking outside funding, Willink says. “It takes time, but it’s doable.” This is where private financing can help make a difference. A major boost came in 2018, when GRID Alternatives Tribal Solar Program secured $5 million from Wells Fargo to launch a new Tribal Solar Accelerator Fund, which supports technical assistance and professional training. Then, at the end of last year, another $12 million was donated by the Bezos Earth Fund. On average, just one of these corporate donations equals nearly all of the grants assigned by the DOE’s Indian Energy Office this year—$9 million value, most of which went to solar projects.

“As we were able to complete a number of projects, we saw more and more tribes approaching us to enlist us as partners,” says Willink, who is indifferent to where the money comes from to support these projects; he is for “diversified funding”, as he puts it. Often, the tribes that GRID Alternatives works with tackle their first renewable energy projects. And the potential is enormous: a one-megawatt solar project can help offset more than 10% of a tribe’s emissions and save nearly $175,000 a year in electricity expenses. The non-profit organization also plays an important role in building a skilled workforce, filling the training gaps to install, operate and maintain such projects, a function that has expanded through the recent philanthropic dollars.

Once the foundation is laid with local facilities and trained workers, communities are able to start thinking about further scaling up where the benefits could be even greater. “In the context of solar energy, the main difference is that large, utility-scale projects sell electricity,” says Jake Glavin, founder of Woven Energy and executive director of Midwest Tribal Energy Resources Association (MTERA), “whereas with these community-scale and smaller-scale projects, they are actually compensating [electricity] shopping.”

With some tribes considering private funding, says Glavin, large-scale projects could be a booming space for them — and so far, the Southwest is leading the way. But even where, according to one report 2019 by the Institute for Energy Economics and Financial Analysis, a “paradigm shift is at work…the development of these resources has moved at an almost glacial pace.” Last year, potentially signaling renewed interest, the DOE hosted a online seminar on how to develop large-scale solar energy on tribal lands.

A tribe that seeks to enter this space is the Ute Tribe of the Ute Mountain, which has land in sunny southeast Colorado, northern New Mexico and southeast Utah. After years of declining oil and gas revenues, a decade ago the tribe began looking for ways to boost their economy and turned to solar power. Bernadette Cuthair, tribal citizen and director of planning and development for the Ute Mountain Ute Tribe, led the charge. Thanks in part to his work, over the years the tribe has received a series of DOE Grants to build two small solar projects. “We have finished thinking about how to adapt,” says Scott Clow, Environmental Director of the Ute Mountain Ute Tribe. “We’re all about the action.”

The tribe now wants to grow. They are looking for investors to innovate on a large-scale solar project that would not only serve their citizens, but bring their solar power to market. It’s a massive leap from community projects costing around $2 million to large-scale power generation requiring hundreds of millions of dollars, but the ambition is there. The goal, if they can get support, is to develop a 200-300 megawatt solar project, Cuthair says. “It’s our appetite.”

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