CENTRAL CITY, Neb. — On an old gravel parking lot on the north edge of town, a pioneer in rural economic development is trying to show how solar energy could reduce electric bills.

Mounted on four rows of steel racks, 8½ feet high and covering an area the size of a football field, shiny black panels of photovoltaic cells soak up the afternoon sun.

In the center, an array of meters and junction boxes hum away, documenting a flow of electricity that can power about 32 homes.

Cliff Mesner, an economic developer for more than 25 years in this Platte River town, has been involved in luring businesses to Central City, expanding the ethanol industry and helping several communities build affordable housing.

Now he’s selling solar.

It’s part of a mini-boom in development of solar power in Nebraska.

A year ago, Mesner completed what was then the state’s largest solar energy “garden” in Central City. Working with the city, he got a couple of local residents and six businesses to invest in the $600,000, 200-kilowatt project.

Once you figure in the federal energy credits, depreciation and a grant from a U.S. Department of Agriculture renewable energy program, Mesner figures he’s cut the energy bills of investors in his project in half.

“Our goal is to take it to the next level,” Mesner said, to expand it beyond a handful of beneficiaries, to an entire community.

His company, Mesner Development, is already at work on that. He’s working with two rural communities, Venango and Scottsbluff, to install 100- and 150-kilowatt solar gardens. In Holdrege, banks of solar cells will help power a housing project there.

At the beginning of the year, the state had about 1 megawatt of solar power generation.

But this year already, Enerparc Inc., an Oakland, California, firm, opened a 3.6-megawatt solar farm on 22 acres along Interstate 80 that generates power for customers of Lincoln Electric System. A rural public power district in Broken Bow will be buying power from four small solar gardens at ranches capable of producing 1.5 megawatts.

By the end of the year, the state’s solar power resources should increase six-fold.

That sounds impressive but still leaves solar as a very dim light in the state’s energy mix.

Six megawatts is about what four wind turbines can generate, and is barely a blip compared with the 1,320 megawatts that can be generated at the coal-fired power plant in Nebraska City operated by the Omaha Public Power District.

As of 2014, about 63 percent of the state’s power was generated using coal and 26 percent was produced by nuclear power. Wind generated 7 percent of the state’s power, followed by hydroelectric, 3 percent, and natural gas, 1 percent. Solar didn’t even make the list.

“We’ve just barely begun to scratch the surface,” said Ken Winston, an aide to State Sen. Ken Haar of Malcolm, a leading advocate for renewable energy in the Nebraska Legislature.

To be sure, solar energy, which can be generated only during the daylight hours, has its limitations, and despite the incentives, is still more expensive than traditional power from coal and natural gas and even wind.

But because of a steady decline in the cost of solar panels, the cost gap is closing, and officials say customers of public power utilities across the state, as well as some businesses, are increasingly demanding that part of their electricity be generated by solar or other forms of “green” energy.

“Solar and wind are certainly resources that we have, and we certainly have Nebraskans who are interested in green energy,” said David Bracht, director of the Nebraska Energy Office.

Bracht said the view of his boss, Gov. Pete Ricketts, is that the state’s energy mix should be “what’s good for Nebraskans.” That means taking advantage of the resources Nebraska has, while looking at the costs, Bracht said.

Toward that end, state lawmakers have scheduled two public meetings this week to educate Nebraskans about the small but significant progress in development of solar energy and about a new state law designed to provide community incentives for energy conservation and renewable energy projects.

As with wind, Nebraska has top-notch resources when it comes to solar power, ranking about 13th nationally in solar potential, according to Bracht.

It has plenty of open spaces, which are needed for the solar panels.

Solar, despite its higher costs, has some advantages over wind, according to advocates such as Mesner and Winston. Because it sits lower to the ground and doesn’t make the “whoop-whoop” noises generated by turning blades, solar farms generate fewer concerns about spoiling the view or ruining the peace, they say.

“You can hide it behind a bush,” Mesner said.

There are few moving parts, so less maintenance is required, he said, and there is no need to save up for expensive decommissioning. And, unlike wind, which blows the best during the winter, the sun shines brightest when the energy need is the highest, on hot, sunny summer afternoons, Mesner said.

Rick Nelson, general manager of Custer Public Power in Broken Bow, said he’s not “pro-renewable energy,” but when some of his farm customers came to him with proposals to build small solar energy projects on their land, he eventually agreed to buy their excess power.

The price was competitive enough, Nelson said, that his other ratepayers were not paying more for their power. And it meant that profits from selling electricity were staying with four local farmers, not going to some far-off utility.

“It’s all about economics,” Nelson said. “If I can save a little bit of money and not have them subsidized by other ratepayers, we have $4.5 million in investment in Custer County.”

“How is that not a win-win?’ he asked.

Graham Christensen of GC ReVOLT said he has installed five 25-kilowatt solar power systems on farms across Nebraska and is working to install three more.

Twenty-five kilowatts is about what’s needed on an average-sized farm, Christensen said, and is also the maximum size at which Nebraska utilities are required to purchase any excess power that is generated, which helps defray the cost of installing such solar systems.

Mesner presented a slideshow at the State Capitol recently that said a 25-kilowatt solar power array costs about $79,000. But when you figure in a 30 percent federal investment credit, a Rural Energy for America Program grant from the USDA, depreciation and a low-interest state loan, the final cost is about $18,400 for 25 years plus of fixed-cost electricity.

Said Christensen, “If you plan to keep the farm in your family, it just becomes a good business decision.”

Bracht, the state energy director, said that solar is still the most expensive power system to build and that unlike wind, you do not get the economies of scale when you build a very large project.

Unlike wind turbines, he added, you cannot graze cattle or grow corn underneath a bunch of solar panels. And solar farms take up a lot of space, Bracht said, which could cause some pushback.

Depending on location, it takes about six to seven acres of solar panels to equal 1 megawatt of generating capacity, he said, so if you wanted to match the amount of power generated by wind farms in the state — about 1,325 megawatts by the end of the year — you would need about 8,000 acres of solar panels.

And, Bracht said, Nebraska’s strong wind resource means wind turbines operate nearly twice as much as solar so it would take well over 15,000 acres of solar arrays to produce the same amount of electricity during a typical year.

Another challenge for solar projects is that Nebraska is a public power state, and federal green energy tax credits are available only to private power utilities, because they pay taxes; OPPD and NPPD, as public entities, do not.

Because of that, solar projects in Nebraska, which need the tax credits to be viable, become more complicated, Mesner said. They can be done, but they must be developed and owned by a private firm, which then must sell the power to a public utility.

So there are pros and cons, and some uncertainties about the future of solar energy.

Will the cost of photovoltaic cells continue to fall? Will they become more efficient in producing electricity? Will better batteries be developed so solar energy can be stored for use later?

Is the future in community-sized solar “gardens,” like Mesner is developing, or in solar panels on top of rooftops to power just one home or business?

As he drove his high-powered electric Tesla across Central City, Mesner said it’s hard to predict how big a future solar energy has in Nebraska.

He’s looking at doubling the size of his solar garden. OPPD issued a request for proposals in July for solar projects in the range of 1 to 100 megawatts. Kearney is looking at adding solar power to help attract a data center seeking green energy. And South Sioux City is planning to add 21 acres of solar panels along with a “gasifier” plant to turn diseased ash trees into energy at its industrial park.

Said Mesner, “I don’t know how much it’s going to grow, but it’s going to grow.”

paul.hammel@owh.com, 402-473-9584

Correction: GC ReVOLT was incorrectly identified in an earlier version of this story.

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Reporter - Regional/state issues

Paul covers state government and affiliated issues. He specializes in tax and transportation issues, following the governor and the state prison system. Follow him on Twitter @PaulHammelOWH. Phone: 402-473-9584.

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