EDA approves financial incentives for Hemlock Ridge Solar
Construction of $400 million project expected to start 2026, be complete 2027
Photo by Tom Rivers: Jack Donelan, development manager for AES Corporation, speaks to the board of the Orleans Economic Development Agency this morning. Neil Habig, director for AES Corporation, is seated next to Donelan. Board members Craig Tuohey, by EDA sign, and Jeff Martin (back to camera) listen to Donelan’s comments.
ALBION – The Orleans Economic Development Agency today approved incentives for Hemlock Ridge Solar and the AES Corporation for its $400 million solar project covering 1,200 acres in barre and Shelby.
The Orleans EDA approved a sales tax abatement of $4,930,000 and an estimated mortgage tax abatement of $1,300,000. It also will be exempted from $63,583 in the local property tax.
Instead, the company will begin paying local governments nearly $40 million in a host community agreement over the next 30 years. The agreement starts with $900,000 the first year, which is $4,500 per megawatt in a 200 MW project. The amounts then increase 2 percent annually over 30 years.
The EDA also negotiated a host community agreement with the taxing jurisdictions with the project that is different than the usual payment in lieu of taxes plans that give companies a reduction in taxes.
Each taxing jurisdiction approved a host agreement that sets the following payments over 30 years to these taxing jurisdictions:
• The Town of Barre will receive $14,007,929 over 30 years for an annual average of $466,931, ranging from $295,200 in year 1 to $646,077 in year 30.
• The Town of Shelby will be paid $3,074,911 over 30 years for an annual average of $102,497, ranging from $64,800 in year 1 to $141,822 in year 30.
• Orleans County will be paid $7,923,242 over 30 years for an annual average of $264,108, ranging from $64,800 in year 1 to $141,822 in year 30.
• Albion Central School will be paid $10,407,330 over 30 years for an annual average of $346,911, ranging from $256,540 in year 1 to $455,575 in year 30.
• Oakfield-Alabama Central School will be paid $1,213,558 over 30 years for an annual average of $40,452, ranging from $29,914 in year 1 to $$53,123 in year 30.
• Medina Central School will be paid $2,363,633 over 30 years for an annual average of $78,754, ranging from $58,239 in year 1 to $103,423 in year 30.
AES also will pay $100,000 a year for 10 years to National Grid to help lower local electricity bills. That will be for $1 million total over 10 years.
The Orleans EDA also will be paid a 1.25 percent administration fee on a $400 million project or $4,519,804 with $750,000 upon execution of the project assistance agreement (within 30 days of the EDA board’s approval of the project) and then another $3,769,804 at the close of financing.
AES officials attended the meeting said they expect construction won’t start until 2026 to line up all the equipment, materials and contractors. The 200 megawatt facility is expected to operational in 2027.
AES detailed the expenses in a filing with the Orleans EDA. The total project costs are estimated at $400,150,000.
That includes building and land purchase, $150,000; site preparation, $10 million; new construction, $160 million; utilities & infrastructure, $30 million; and transportation access, $5 million.
The machinery and equipment is estimated at $190 million and includes solar modules at $98 million; solar racking/piles, $41 million; inverter, $11 million; wiring, $30 million; and HV equipment, $10 million.
Jack Donelan, development manager for AES Corporation, told the EDA board there will be a 7-foot-high agricultural style fence on the 1,200 acre perimeter. There will be a 7-foot-high chain-link fence around the electric substation, with a foot-high of barb wire.
AES estimates 264 workers will be needed for the construction. Once it’s done, 0.5 full-time-equivalent may only be needed at the site.
Donelan said AES will connect into the grid through the transmission lines that run along the southern part of Orleans County.
