Solar Energy and the Williamson Act: Legal Developments and Recent Trends

• Jurisdiction: California,United States
• Citation: Vol. 24 No. 1
• Publication year: 2015
• Author: by Bradley Brownlow
• topic: Contracts,Environmental Law,Energy & Natural Resources,Real Estate

Solar Energy and the Williamson Act: Legal Developments and Recent Trends

by Bradley Brownlow^*

Less than a decade after enactment of the California Global Warming Solutions Act of 2006 (AB 32), California stands as a global leader in the shared endeavor to reduce greenhouse gas emissions to sustainable levels. The electricity sector, however, remains one of California's largest greenhouse gas contributors, historically responsible for approximately 23 percent of statewide emissions.¹ To reduce these emissions, the Legislature implemented renewable portfolio standards (RPS) that require the state's investor-owned utilities (IOUs) to procure 33 percent of their annual retail electricity sales from eligible renewable resources by 2020.²

Adoption of the RPS requirements prompted a wave of renewable energy development in the state. Between 2008 and 2015, roughly 8,000 megawatts (MW) of renewable energy capacity achieved commercial operation, with 2,541 MW of additional capacity projected to come online in 2015.³ As a result, California's IOUs now serve approximately 21 percent of retail sales with RPS-eligible generation and are well on their way to achieving the 2020 RPS mandate.⁴

One side effect of California's RPS success is the recent slowdown of utility-scale (i.e., >20 MW) solar electric generation development.⁵ As the installed capacity of clean energy resources nears the 2020 RPS target, IOUs are executing fewer of the power purchase agreements that help fuel utility-scale solar development.⁶ However, the solar industry is hopeful that this trend will reverse following Governor Jerry Brown's January 2015 inaugural address, in which he called for expanding California's renewable energy target from thirty percent by 2020 to fifty percent by 2050.⁷ If the RPS is raised to achieve the Governor's long-term clean energy vision, a new wave of utility-scale solar development may follow. Indeed, achieving California's long-term greenhouse gas reduction goals may depend on it.⁸

Although the rapid growth of utility-scale solar energy capacity has been remarkable, it has also been controversial, particularly with respect to its impact on the state's agricultural land resources.⁹ Agricultural land is well suited for solar development because it is generally flat, exposed to sunlight, and often of reduced habitat value due to previous disturbance.¹⁰Much of this land, however, is subject to strict land use restrictions imposed by voluntary contracts entered into pursuant to the California Land Conservation Act of 1965, commonly known as the Williamson Act.¹¹ As discussed below, a Williamson Act contract restricts the subject property to agricultural uses. Such restrictions are an obvious obstacle to solar energy development.

This article explores the interplay between the WilliamsonAct (Act) and utility-scale solar development, focusing on the rights and obligations of cities and counties that are considering approval of expansive solar projects on lands subject to Williamson Act contracts. In doing so, this article examines legislative mechanisms designed to provide local agencies relief from the Williamson Act's strict land use controls, as well as recent case law applying the Williamson Act to solar energy project approvals. Finally, this article evaluates, and makes recommendations to improve, the Williamson Act's solar use easement and agricultural conservation easement programs, as they apply to solar development.

THE WILLIAMSON ACT AND SOLAR ENERGY IN CONFLICT

Though essential to achieving the state's greenhouse gas reduction targets, the success of utility-scale renewable energy development in California comes at a cost. Such development is often land intensive, particularly utility-scale, ground-mounted solar energy projects. By way of example, the total land area required to construct a solar photovoltaic (PV) project is estimated at 6.9 acres per installed megawatt on a capacity-weighted average across all solar PV technologies.¹² Using these figures, it could require 138 acres to construct a relatively small 20 MW solar PV project.

Former Governor Arnold Schwarzenegger's Executive Order S-3-05 calls for the reduction of statewide greenhouse gas emissions to 80 percent below 1990 levels by 2050.¹³ To achieve these reductions, the California Council on Science and Technology (CCST), a non-profit organization that provides science and technology expertise to state policymakers, has determined that "[significantly more renewable power plants will be required[,]" even if the state installs 3.85 million 5-kilowatt (kW) roof-top solar systems between 2015 and 2050.¹⁴ Specifically, CCST recommends constructing three 500-MW utility-scale solar energy plants, three 500-MW wind energy plants, and 110,000 5-kW distributed solar facilities every year through 2050 if California hopes to achieve the ambitious greenhouse gas reduction target described in Executive Order S-3-05.¹⁵ New utility-scale solar development on this scale could require approximately 362,250 acres, assuming a need for 6.9 acres per installed megawatt.

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The Williamson Act - enacted to slow the conversion of agricultural land to urban use—is California's premier agricultural conservation program. The Act is administered by the California Department of Conservation (Department), though it is primarily implemented at the city and county level. In 2011, the most recent year for which data is available, 15 million acres were subject to the Williamson Act, approximately 31 percent of California's private land supply.¹⁶

Some of the state's Williamson Act land is proximate to the electric transmission facilities needed to bring solar power to market.¹⁷ Consequently, state policies to aggressively promote renewable energy generation sometimes conflict with state policies to conserve agricultural resources. One high-profile example is reflected in the Desert Renewable Energy Conservation Plan (DRECP) currently being prepared by the California Energy Commission and other state and federal agencies to accommodate new renewable energy development in California's desert regions.¹⁸ The DRECP's draft environmental review document anticipates that up to 56,000 acres of important farmland will be converted to renewable energy uses under the DRECP's preferred alternative.¹⁹ Of that land, approximately 2,000 acres are currently subject to Williamson Act contracts.²⁰ Similar conflicts have occurred around the state²¹ and are likely to continue if California hopes to achieve the long-term greenhouse gas reduction targets set forth in Executive Order S-3-05.

WILLIAMSON ACT CONTRACTS

If a local agency elects to participate in the Williamson Act program, it must designate qualified land within its planning area as an agricultural preserve, subject to Department approval.²² Once established, landowners within the preserve can sign a contract whereby they agree not to develop their land in exchange for a lower property tax assessment.²³ A Williamson Act contract has an initial term of ten years and automatically selfrenews for an additional year on the anniversary of the contract's effective date. ²⁴ During the contract term, only agricultural uses and "compatible uses" are permitted on the contracted land.²⁵

SOLAR FACILITIES AS A COMPATIBLE USE

If a solar facility is proposed on contracted land it may only proceed under contract if it qualifies as a "compatible use," as defined in the Act.²⁶ Whether, and under what circumstances, a utility-scale solar project qualifies as a compatible use is, however, a matter of debate. Some argue that a solar facility is deemed a compatible use by law and is always permitted on contracted land, unless the local agency makes a finding to the contrary.²⁷ Others argue that solar facilities are never permitted on contracted land, except in very limited circumstances and only if strict findings requirements are first satisfied by the local agency.²⁸ At the heart of this debate is disagreement over the proper application of Government Code section 51238 (Section 51238) and its companion statute Government Code section 51238.1 (Section 51238.1).

The Williamson Act identifies three circumstances when a non-agricultural land use may occur on contracted land. First, a non-agricultural use may be permitted on contracted land when consistent with the Act's so-called "principles of compatibility," as provided in Section 51238.1, subsection (a). Second, a non-agricultural use may be permitted on contracted land, even if inconsistent with the principles of compatibility, if approved pursuant to a conditional use permit that satisfies specific findings and mitigation requirements, as provided by Section 51238.1, subsection (c). Third, some nonagricultural uses, including electric facilities, are statutorily deemed compatible within all agricultural preserves, unless the local agency makes a finding to the contrary, as provided by Section 51238.²⁹ Each of these circumstances and their application to solar energy facilities is considered below.

A. NonAgricultural Uses and the Principles of Compatibility

The Williamson Act authorizes a local agency to approve a non-agricultural use on contracted land if it expressly finds that the proposed use is consistent with the Act's so-called "principles of compatibility," as described in Section 51238.1(a). To establish consistency, the agency must demonstrate that the non-agricultural use (i) will not impair or displace agricultural operations on the contracted parcel, (ii) will not significantly compromise the agricultural productivity of the contracted parcel, and (iii) will not remove adjacent contracted land from agricultural or open-space use.³⁰

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Obviously, it is difficult to establish consistency with the principles of compatibility when the proposed non-agricultural use is a utility-scale solar project with a footprint that precludes or significantly displaces agricultural operations on the contracted land...