Hearings and Business Meetings

SD-366 Energy Committee Hearing Room 02:30 PM

Mr. Bob Liden

Executive Vice President and General Manager, Stirling Energy Systems

Testimony of Robert B. Liden

Before the United States Senate

Energy and natural resources committee Hearing

On Renewable Energy on Federal Lands

July 11, 2006

2:30 pm

 

Good afternoon.  My name is Robert Liden,

and I am the Executive Vice President and General Manager of Stirling Energy Systems, Inc. (SES), a solar energy development company headquartered in Phoenix, Arizona.  We also have engineering offices at Sandia National Laboratories in Albuquerque, New Mexico, and a small satellite office in Tustin, California.

 

I want to thank you Mr. Chairman and senator bingaman for having this important hearing and allowing ses the opportunity of testifying.  without  this committee’s continued support for solar energy and, in particular, for concentrating solar power, we would not have been in a position to proceed with these large contracts, bringing into commercial deployment technology that is the fruit of over 20 years of research and development by private industry, the U.S. Department of Energy, and the national laboratories (particularly Sandia National Laboratory).

 

I also would like to applaud you for passing the very comprehensive Energy Act of 2005, which, among other things, provides increased tax credits, a loan guarantee program, and other key incentives for the development of clean, renewable energy.

 

Our company has signed contracts with two large utilities in Southern California and are in negotiations in new mexico for a third project to develop the world’s largest solar power plants.   What is particularly relevant here is that both of the projects in California will be sited primarily on BLM land.

 

Regarding the two large solar contracts in california, both are 20-year power purchase agreements, one with Southern California Edison (SCE), and the other with San Diego Gas & Electric (SDG&E).  The SCE contract is for 500 MW (peak output), with an expansion option for an additional 350 MW.  The plant will be sited in the Mojave Desert east of Barstow, CA.  The SDG&E contract is for an initial 300-MW plant, with options to expand by another 600 MW.  This project will be sited in the Imperial Valley near El Centro, CA.  The two contracts, when fully built out (including the expansion options) will result in 1,750 MW of peak power generation capacity.

 

The solar technology being employed for these projects is a concentrating dish-engine system that was initially developed in the mid 1980’s by McDonnell Douglas, later purchased and further tested by SCE, and in 1996, purchased by SES.  it is important to note that our dish technology does not require water for cooling. We have spent the past 10 years testing and modifying the dish system design for high-volume manufacturing and deployment.

 

For these two contracts, we will be deploying as many as 70,000 dishes, which will be installed on a total of 11-13 square miles of desert land and our technology. (The specific land requirement is partly dependent on local siting issues, such as washes, rock outcroppings, etc.)  In essence, we will be planting 70,000 technological trees in two large solar forests.  As mentioned above, almost all the land at the selected sites is owned by the Federal government and administered by the Bureau of Land Management (BLM).

 

We are currently in the process of performing environmental impact studies and preparing permit filings required by the Federal Government and by the state of California.  I am pleased to report that the two regional BLM offices that are working with us have both provided excellent support and help.

 

This is a continuing experience for us, and we are, in a very real sense, plowing new ground.  These will be the first large solar dish power plants ever constructed, and it has been nearly 15 years since any large-scale solar plants of any kind have been built in the U.S.  I offer the following observations, however, based on our experience to date:

 

 

  1. Renewable energy projects, particularly solar and wind, require large amounts of land.  (However, to put this in perspective, a solar dish farm covering about 11 square miles of land in the solar-rich Southwest can generate as much energy each year as the Hoover Dam, which requires 247 square miles of Lake Mead.)

  2. The Mojave Desert is the prime site for large-scale solar project development in California. There are persistent efforts by environmentalists and conservationists, however, to get legislation to preserve all of the Mojave Desert and not allow any development.

  3. Endangered species (such as desert tortoises) require mitigation efforts, including securing up to 6 times the amount of land actually required for the solar project.  This is expensive and, in many cases, is a real “deal-stopper”.  At times, the BLM requires the developer to purchase non-BLM land for this mitigation and deed it over to the BLM for use in providing a protective habitat for the displaced tortoises. This is also problematic, since BLM no longer has enough staffing to handle the real estate acquisitions, and the private land-owners, approached by a developer, generally seize the opportunity to hike significantly the price of their land.  (In fact, what we have seen is that the BLM regional offices – at least the ones in Barstow and El Centro – are understaffed and stretched too thin.  Even providing emergency medical services to people injured on the government lands is a challenge, given the few people and the vast amount of land to oversee.)

 

 

How Congress can help encourage the development of renewable resources on Federal lands:

 

  1. Encourage the land-holding agencies (Department of Interior, Department of Defense, etc.) to establish “set aside” lands in their resource plans specifically for the development of solar, wind, etc.  (NREL has well-developed maps showing the prime areas for development of all the renewable resources to assist the agencies in this effort.)  To further encourage the development of renewable energy projects on these lands, environmental impact studies should be undertaken by the Federal land owners, resulting in the identification of, for example, solar or wind enterprise zones, where solar or wind developers can more rapidly and efficiently bring their projects “on line”.

  2. Encourage FERC, WAPA, and other Federal power transmission authorities to develop a master plan for upgrading and expanding the transmission network to facilitate getting the power from Federal lands to the major load centers and population centers.  These upgrades are sorely needed, but they are generally very expensive.  Requiring developers to finance these upgrades (even if the developers are ultimately repaid their expenses) is onerous, and it discourages all but the most deep-pocketed developers from proceeding with their projects.

  3. Establish ground rules for setting lease rates on Federal lands that encourage the use of these lands for renewable project development and recognize the need for low-cost land to keep the overall cost of renewable energy as low as possible.

 

 

Finally, a brief reminder of why renewable energy development is important:

 

  1. The economic impact of new renewable energy projects is immense – hundreds to thousands of jobs to develop and operate these power plants, bringing new tax dollars into primarily rural communities, where unemployment is high and a boost to the local economies are sorely needed.

  2. Renewable power plants reduce the nation’s dependence on fossil fuels and imports, enhancing our national security, improving our balance of payments, and stimulating our economy.

  3. Renewable power plants improve our environment, reducing greenhouse gases, and cleaning our air.  (For example, our two solar projects in California, if built out to their full potential of 1,750 MW, will displace 1.8 million tons of coal consumption and reduce CO2 emissions by 400 tons per year compared to a coal-fired plant of the same size.)

Again, I thank you for this opportunity and I look forward to any questions the committee may have.