North Carolina has been a hotbed of activity for residential and utility scale solar developers. According to the Solar Energy Industry Association, the Tar Heel State ranks fourth in the country in terms of installed solar capacity (1,088 MW). However, the North Carolina Energy Policy Council (EPC)—an advisory body within the state’s Department of Environment and Natural Resources (DENR)—is considering a new permitting requirement that could significantly impact the future pace of solar development in the state. The proposal comes on the heels of Congress’ decision to extend the investment tax credit for renewable energy projects, which will likely lead to a boom in solar project development.

At its January 27 meeting, the EPC considered a proposal that would require solar developers to obtain a permit from the state before constructing and operating a new solar farm. Although details are scant, it appears that this proposal would give the state siting authority over new solar installations. At this time, there is no information about the criteria the state would apply when deciding whether to issue a permit; however, this proposal could give the state substantial discretion over the development of new solar facilities.

For this reason, the proposal represents a significant departure from existing permitting practices in North Carolina. Under the current regime, municipalities control the siting of solar facilities through their municipal zoning codes. The municipality establishes certain geographic areas where developers can build solar farms, either upon the issuance of a conditional use permit (CUP) or “as-of-right” (i.e., without a permit). Depending on the size and scope of the solar farm, the developer may have to apply to the state for other permits (e.g., a certificate of public convenience and necessity or a stormwater permit). Moreover, the Department of Administration’s Environmental Review Clearinghouse provides state agencies with the opportunity to review and comment on the potential environmental impacts of a given solar project. However, at this point, the state does not control facility siting per se.

Advocates of the new permitting requirement claim that it is needed because small municipalities do not have the time or resources to “adequately judge the outcomes and the long-term impacts of these solar facilities.” They see the statewide permitting requirement as necessary to provide additional oversight of solar installations. One industry stakeholder said that “there is a forum for looking at best practices around permitting,” but that the industry should be consulted before anything is set in stone.

The EPC did not hold a formal vote on the statewide permitting proposal, but plans to discuss it again at its next meeting in March. Solar developers may want to keep track of this issue; if the state decides to act on the EPC’s proposal, it could present an additional regulatory hurdle to developing solar projects in North Carolina.