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Solar Article in the LA Times

Posted on February 20th, 2012 by John Reeder

Over the weekend my phone rang a little more than usual and I eventually figured out it was because I had been quoted in the LA Times in an article about the solar land market.  I almost didn’t even remember talking to the reporter, it happened so long ago.  I think I talked to her in August (or about then).  Anyway, it’s an interesting study in journalism.

When the reporter called, I got the sense that somebody had told her that there were companies who were controlling cheap land options on federal land and that these companies stood to make a lot of money essentially on the backs of the tax payers.  I let her know that I didn’t really deal with that part of the market and then I think we had about a 30 minute conversation on solar development on private land that focused mainly on the challenges that solar companies have to deal with.  These challenges are very near and dear to my heart because they are currently standing between me and a sizeable amount in commission income.  So when I talk to people, the challenges are typically what I talk about most.  It’s also worth noting that speculation on federal land wasn’t a key part of the story so I’m assuming that the other people the reporter talked to also disabused her of her original idea for the story.

The reason I mention this is because the gist of the article is solar land prices.  Solar land prices were a story from 2008-2011, but really aren’t any more.  So basically this story is reporting a trend from two or three years ago and presenting it as if it’s news today, which it isn’t.  Most of the land acquisition has already happened.  Most companies have moved past land acquisition into permitting and power marketing. 

If there is a story to report as far as land prices, it’s that prices are falling.  The prices that utilities are willing to pay for energy are falling, and solar panel prices are falling, so land can’t keep going up in value forever.  In fact, much of the land has been so over-speculated that when a company cancels an option contract, there often aren’t any remaining companies willing to take a new shot at the land.

I often deal with landowners whose primary source of information is the newspaper.  They read that Obama is bullish on alternative energy, they read stories like the one in the LA Times, and they think they understand the forces that shape the market.  But I am somewhere between an outsider and an insider when it comes to the solar land market and my outlook is generally 180 degrees different from most of the land owners who get their information from the newspaper.  I think that’s something of a comment on the relative value of journalism in today’s world.  This is the only article I’ve read recently where I was both something of an expert on the topic, and was also involved in the collection of the information, and I didn’t feel like the actual article really touched on the important themes.  When that happens, you start to wonder about the relative value of everything else you’re reading.

February 20th, 2012 | Category: Uncategorized

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