NextEra Energy Resources sues U.S. government for $127 million

A lawuit filed last week against the U.S. Treasury will attempt to recover money NextEra claims the government owes it under the Section 1603 grant program.

February 26, 2018 Frank Andorka

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The U.S. Treasury owes Silver State Solar Power South $127 million – and it’s time to pay up, according to a lawsuit filed by the company last week.

According to Silver State, a subsidiary of NextEra Energy Resources, the government has arbitrarily withheld the money it should have paid the company under the Section 1603 grant program to offset the construction costs on a 250 MW-AC project near Primm, Nevada, that it completed in 2016.

Silver State claims it met all the requirements as required for full payment of the grants, including starting construction on the project before 2011 and finishing the project prior to January 1, 2017. Under 1603, payments couldn’t be made during the construction and could only be paid once the project was placed in service, something Silver State says it did on June 21, 2016.

The project is located on U.S. Bureau of Land Management property in Clark County, Nevada, and consists of 3,433,955 individual thin-film PV modules mounted on single-axis trackers, 226 power inverter units, and associated wiring.

Silver State says the withheld funds are designed to offset some portion of the construction costs for the plant. It also alleges the government offered no explanation about why it withheld the money from the company.

In the early days of the solar boom, the 1603 grants served as a boost to the industry’s growth. As the program drew to a close, however, the program was far more important for wind programs than it was for driving the solar industry.

The purpose of the 1603 payment was to reimburse eligible applicants for a portion of the cost of installing specified energy property used in a trade or business or for the production of income. A 1603 payment was made after the energy property is placed in service.

Correction: This article was edited at 11:48 AM on 2/26/2018. The article originally stated Silver State Solar was a subsidiary of First Solar and that as such First Solar was suing the federal government. However, project company Silver State Solar was sold to NextEra, which makes NextEra the company behind the lawsuit. We regret the error.

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