The Sacramento Municipal Utility District announced Monday afternoon that it is withdrawing from the controversial Coyote Creek Agrivoltaic Ranch project, terminating a power purchase agreement that had tied the utility to one of Sacramento County’s largest approved solar developments located just south of the Folsom city limits.
SMUD said it will no longer purchase power from the project after determining that a range of unresolved uncertainties have made continued participation unworkable. The decision ends a power purchase agreement signed in 2021 with D.E. Shaw Renewable Investments, the developer of the proposed 200-megawatt solar and battery storage facility planned for the historic Barton Ranch in southeastern Sacramento County.
In announcing its decision, SMUD cited supply chain constraints, rising prices, tariffs, schedule delays, environmental impacts and pending litigation.
“Over the years, SMUD and DESRI have delivered multiple important clean energy projects that benefit our community, and we look forward to continuing our partnership for years to come,” SMUD CEO and General Manager Paul Lau said in a statement. “We’d like to thank Sacramento County for all their work throughout the process and our SMUD Board of Directors for their leadership. We remain committed to following a flexible pathway to eliminate all carbon from our power supply by 2030.”
The Coyote Creek Agrivoltaic Ranch project was approved by the Sacramento County Board of Supervisors in November 2025 following a public hearing that drew more than 150 speakers and hours of testimony. The project spans roughly 2,700 acres on Barton Ranch near Scott Road, east of Rancho Cordova and adjacent to open space and recreation land near the Prairie City State Vehicular Recreation Area.
What is the Coyote Creek Solar Project
The proposal includes a 200-megawatt solar array paired with a 100-megawatt battery storage system and incorporates an agrivoltaic design allowing sheep grazing beneath the panels. Supporters told county leaders the project would help advance clean energy goals while generating construction jobs and local tax revenue.
As noted in previous Folsom Times coverage on the project, Jaime Torres, a business representative with Laborers Local 185, spoke in support of the project during the November hearing. “It’s a source of income for our members,” Torres shared, adding that the project overall was “a wonderful resource for our environment… it’s a renewable source.”
Opposition focused largely on environmental and cultural impacts tied to the project’s location. Jessie Dickson, a local botanist who said the scale of oak tree removal undermined the project’s environmental claims.
“There’s nothing environmentally friendly about cutting almost 4,000 oak trees, the most ecologically valuable native tree in all of North America,” Dickson said. “Over 2,000 species depend on them.”
Luz Lim, a policy analyst for the Environmental Council of Sacramento, also opposed the project at the hearing. “We think it is necessary to have solar development to reach our climate goals, but we also need to be strategic,” Lim said. “It doesn’t make sense that we are going to, in the name of green energy, kill thousands of blue oak trees, native trees, that have been here for a really long time.”
Supervisors described the vote as difficult. District 3 Supervisor Rich Desmond called the decision “agonizing,” saying he empathized with the environmental concerns raised by opponents before ultimately supporting the project. District 2 Supervisor Patrick Kennedy also described the vote as challenging but said broader climate goals weighed heavily in his decision.
“We have to take actions that go beyond nibbling around the edges, while weighing sacrifices,” Kennedy said.
Former Sacramento Mayor and Environmental Council of Sacramento board president Heather Fargo criticized the project’s location choice. “This is an OK project in a very bad location,” Fargo said in the previous article.
Tribal leaders also spoke against the proposal. “I’m here today to voice my opposition to the Coyote Creek solar project,” said Malissa Tayaba, vice chair of the Shingle Springs Band of Miwok Indians. “Should it move forward, it would result in irreparable harm and desecration to cultural resources, including village sites, burials, habitat for our plant and animal relatives, as well as the destruction of oak trees so critical to this unique cultural landscape.”
Following the project’s approval, environmental groups filed a lawsuit against Sacramento County in December 2025 challenging the project under the California Environmental Quality Act. The suit alleges the county approved a flawed environmental impact report that fails to adequately analyze and mitigate harm to oak woodlands, sensitive species, groundwater resources and nearby recreation areas.
“Make no mistake, this is not a choice between clean energy or irreplaceable habitat,” Lim said in a statement released with the lawsuit. She added that SMUD is already on track to meet its 2030 Zero Net Carbon Plan through other projects while thousands of oak trees could be lost under the Coyote Creek proposal.
During the November hearing, Sacramento County associate planner Kimber Gutierrez told supervisors that while most impacts could be mitigated, several could not. “While most impacts are mitigated, three remain significant and unavoidable — aesthetics, cumulative oak woodland loss and tribal cultural resources,” Gutierrez said.
District 4 Supervisor Rosario Rodriguez, whose district includes Folsom and surrounding communities, later published a commentary explaining her vote in favor of the project. “The Coyote Creek project is a privately proposed large solar facility on rural land in southern Sacramento County,” Rodriguez wrote. “The County did not design the project, select the site, or set California’s energy rules.”
Rodriguez pointed to state energy mandates and potential impacts on electricity costs, writing, “If they are not met, the consequences fall on ratepayers in the form of higher electricity costs.” She added that the board’s decision “was about complying with those mandates in a practical way, not about making a symbolic statement about energy policy.”
She also addressed concerns about land use, stating that approximately 3,000 oak trees would be removed while more than 13,000 would remain on the property, that identified vernal pools would be avoided, and that substantial acreage within and surrounding the project would be permanently preserved.
SMUD’s withdrawal does not reverse Sacramento County’s approval of the project, nor does it resolve the pending litigation. The utility emphasized that its decision was driven by project-specific uncertainties and reiterated its commitment to eliminating carbon from its power supply by 2030 while maintaining reliability and affordability.
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