Bob Heers and his family farm 2,600 acres near Owatonna, MN, and were named Steele County Farm Family of the Year in 2010 by the University of Minnesota. They finish 10,000 pigs a year and row crop corn, soybeans, and peas. Though the farm has expanded, it was started by Bob’s father and grandfather in the 1950s when they moved to Steele County. In 2015, when his sons Matt and Nate entered the farm operation, Bob invested in the future by adding 80kW of solar energy.
The real benefit is that the solar panels lock in our electricity costs for the future.
Matt Heers, Steele County farmer
Taking control of energy bills
The solar installation is divided into two 40 kW systems across 12 dual-axis trackers, which allows the farm to receive the net metering retail price when they produce more electricity than they use. While Matt Heers thinks the trackers "are kind of cool to watch as they move during the day," he notes that "the real benefit is that the solar panels lock in our electricity costs for the future." Bob confirms that the farm used to pay about $17,000 a year in electrical costs, but with the PV systems they now have a net energy income of around $1,500 per year.
The arrays are dual-axis trackers, which means they follow the path of the sun during the day, both vertically and horizontally, to maximize the electrical output. When asked about maintenance, Matt said that they were once called by the monitoring company to turn the trackers on and off, and once during a heavy snow they had to shovel snow from around the bottom edge of several of the units.
Working with the installer and utility
The solar arrays were installed by Blue Horizon Energy and come with a 10-year monitoring system that has its own Wi-Fi, and uses a Vermont-based company to detect any problems with system generation. Both Bob and Matt shared stories of a Blue Horizon maintenance team stopping to fix a problem they didn’t even know was occurring.
Barry Thompson, a Blue Horizon Energy sales representative said "installing a consistent monitoring system with its own internet connection actually saves time and money in problem-solving." Thompson said that most issues are discovered within 24 hours.
Heers Family Farms are in the Steele-Waseca Cooperative Electric territory. Bob said the coop was "good to work with."
The biggest barrier is the up-front cost, which is substantial, especially in this economy. But I take the long view, especially because my sons are entering the farm operation.
Bob Heers, Steele County farmer
Paying for solar
"The biggest barrier is the up-front cost, which is substantial, especially in this economy," said Bob. "But I take the long view, especially because my sons are entering the farm operation," he continued. Heers said that the farm was able to use the 30% federal tax credit, and received a 2016 USDA Rural Energy for America Program (REAP) grant of $20,000. That in addition to the accelerated depreciation has meant that the solar systems will break even in about 10 years and provide about a 10% annual return on their investment.
The federal tax credit allows businesses to offset taxes by a percentage of the cost of a solar energy system. While it was 30% for systems installed through the end of 2019, in 2020 it is set at 26% of the cost, in 2021 will be reduced to 22%, and thereafter set at 10%. REAP grants can be used for either energy efficiency or renewable energy projects by an agricultural producer or a rural small business. The next deadline for REAP applications is in October of 2020.
Because of a challenging farm economy the last several years, there are fewer applicants for the same amount of REAP funds. Applicants who can move forward with projects now will be in a stronger position to win REAP grant funding compared to past years.
Fritz Ebinger with CERTs
Get support from CERTs
Farmers and rural small businesses interested in exploring their own renewable energy options can work with CERTs to get support navigating the USDA REAP grant and loan programs, as well as providing no-cost solar PV assessments, and talking through other incentives. Fritz Ebinger who provides this assistance with CERTs shared, "because of a challenging farm economy the last several years, there are fewer applicants for the same amount of REAP funds. Applicants who can move forward with projects now will be in a stronger position to win REAP grant funding compared to past years." He said that in the last two years almost all applicants were awarded grants.