LEGAL
On one of the first crisp days that signals the arrival of fall in Minnesota, I sat down with a former colleague, David Streier, to talk about his new gig. He recently joined Newport Partners, a private company that provides financial services to developers, investors and companies who want to take advantage of tax credits in affordable housing, historic rehabilitation, and renewable energy business sectors. Newport Partners is the parent company of Silicon Energy of Minnesota, a solar energy company that manufactures photovoltaic or PV modules, at its plant in Mountain Iron, Minnesota, where it employs about a dozen workers. These PV modules are installed as solar arrays by contractors across Minnesota.
We talked about life in a solar energy start-up, regulatory and legislative priorities for solar energy in Minnesota, and his hybrid role as a project manager who brings a legal perspective to his business.
In a recent press release from the Solar Energy Industries Association, the SEIA reported record growth and sunny prospects in 2012 for the utility photovoltaic (PV) market in the United States. Here in Minnesota, the emerging solar industry has also seen growth, despite the shorter daylight hours during our long winters. Streier explained to me that, in fact, Minnesota has an equal or greater solar resource than many southern cities. And in comparison to Germany, currently the number one country for installed solar, all states in the lower 48 have much greater solar resources (even including rainy Washington State).
Minnesota cities, residential homeowners, and commercial enterprises are starting to embrace solar energy for the potential cost-savings it offers. Silicon Energy is installing solar arrays on municipal grounds for the City of Mountain Iron and the City of Lindstrom, and the Bloomington Ikea has begun the process of installing the largest solar array in the state on its roof (Silicon Energy is not involved in the Ikea project.)
Governmental agencies and utilities including the Division of Energy Resources, the Minnesota Department of Commerce, and Xcel Energy have offered support, tax incentives or rebates to help foster the nascent solar industry. This year, the Minnesota Department of Commerce has attempted to streamline permitting processes for PV installations with the Minnesota Energy Challenge.
Xcel Energy launched Solar Rewards, a rebate program, in 2010 to create an alternative to Xcel-generated electricity, by mandate of the Minnesota Legislature. It was to run through 2014. In June, Xcel Energy indicated that it would like to discontinue the program at the end of 2014 because the cost of solar array installations had fallen so dramatically that the program was no longer warranted.
Solar energy companies disagree, arguing that the solar industry is still struggling to establish itself as an alternative to traditional energy sources. Newport Partners' vice president told the Star Tribune earlier this month that Silicon Energy was "slow getting to market" last year after delays caused by the Japanese earthquake and tsunami, and Silicon Energy is currently working with its creditors to repay loans it took out for the Mountain Iron plant. Other solar companies in Nevada and Colorado, along with the infamous Solyndra in California have closed up shop in recent years. Market conditions for solar energy do not seem nearly so clear cut as either the traditional energy competitors like Xcel or SEIA's glowing report would make out.
The Minnesota Department of Commerce Commissioner is considering whether Xcel must continue the well-received Solar Rewards through 2015 or allow Xcel to discontinue the program.
Streier and I talked about the unique opportunity he has to work in a challenging business environment that has traction to gain consumer and commercial acceptance in the coming years — what solar industry insiders refer to as the "solar coaster." As Streier noted, the solar energy industry is in its early stages and needs more protections in the form of federal, state, and local tax incentives and rebates while it develops. He points out that renewable energy incentives lag behind incentives for investment in traditional energy sources, and he argues that solar energy should have a level playing field with other energy sources like coal and oil until the industry is fully developed.
Streier's main job duties are managing the financing and applications, as well as the contracting processes, for solar array installations across the state. But as one of the only attorneys working at the company, he also has a legal perspective on the business. As such, Streier serves as a de facto corporate legal department, but he was quick to point out that he wears more than one hat in his organization, and driving completion of solar energy projects is the main goal of his job.
When contemplating the legal landscape for Newport Partners, Streier is focused on federal and state regulations, and contract drafting. Currently, federal tax incentives and utility rebates are the lifeblood to financing a PV installation project, thus Newport Partners must stay abreast of and comply with I.R.S. regulations. The Department of Commerce and Public Utilities Commission have a hand in regulating solar generation in the state, so their regulations and guidance are on his radar. Streier also prepares contracts for new PV installation projects using industry-standard forms and agreements, contracts drafted and vetted by outside counsel, and contracts he drafts himself.
As a newer attorney, Streier enjoys learning more about drafting contracts for different situations. And through working with executives and lobbyists at his company, he is also getting exposure to the business side of solar industry issues, wins, and road blocks. Streier's exposure to the business side and the legal perspective he brings to the company highlights the unique roles that attorneys can find working within start-up businesses today.
Mary Grams markets Thomson Reuters transactional and regulatory products, including Westlaw® Reg & Leg Center, to legal and business professionals within corporate legal departments. She writes about trends in the practice and business of law.
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