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Labor, materials shortages blamed for $32M cost bump at Iowa County solar farm

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Badger Hollow

Workers complete the first phase of the 300-megawatt Badger Hollow II solar farm in Iowa County in October. Utilities say rising labor and material costs have added nearly $32 million to the cost of the second phase of the project and delayed completion by three months.

Rising prices are being blamed for a nearly $32 million cost increase for a solar farm under construction for two Wisconsin utilities.

Madison Gas and Electric and We Energies say a combination of supply-chain constraints, increased labor costs and trade investigation have resulted in a 16% cost overrun and a three-month delay for the Iowa County project known as Badger Hollow II.

The utilities say the cost increases will enable the project to avoid significantly longer delays, resulting in lower greenhouse gas emissions and lowering future energy costs for customers.

In filings with regulators, the utilities blame rising prices for commodities such as steel and say they had to pay more to get solar panels, which have been in short supply as a result of a federal investigation into whether Chinese manufacturers are circumventing import tariffs by routing products through four southeast Asian countries.

Imports, which account for more than half of the panels used in the United States, slowed to a trickle after the investigation launched in March amid fears of retroactive tariffs of up to 250%, according to the Solar Energy Industries Association.

President Joe Biden last month put a two-year hold on any new tariffs through an executive order aimed at also accelerating domestic production of solar panels.

The first phase of the 300-megawatt solar farm was completed last year after delays attributed to the COVID-19 pandemic.

The utilities initially notified regulators in June that the second phase would exceed the $195 million approved cost but sought to withhold the amount, arguing there was no public benefit to disclosing information that could benefit competitors.

The amount was made public Wednesday after the Public Service Commission denied the confidentiality request.

Solar panel shortages have been blamed for delays in at least two other Wisconsin utility projects.

Alliant Energy, which plans to invest about $1.5 billion in a dozen solar sites across the state, has postponed the start of construction of a $250 million solar farm in Grant County by five months, while Xcel Energy says a $104 million project in Pierce County will be delayed by at least a year.

Neither utility has notified regulators of price overruns on those projects.

Earlier this year Alliant, MGE and WEC Energy Group announced they were postponing retirement of three of the state’s largest coal-fired plants because of potential delays to solar projects and concerns about a capacity shortage on the Midwestern power grid.


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