A controversial solar project in eastern Sacramento County has a possible path forward after environmental and recreation groups reached a settlement with its developer that would protect thousands of blue oak trees. 

The Coyote Creek Agrivoltaic Ranch Project was approved by the Sacramento County Board of Supervisors in November 2025. The proposal in 2025 called for a solar farm and battery storage system on roughly 2,700 acres along Scott Road near White Rock Road, with the potential to power more than 44,000 homes.

The Environmental Council of Sacramento, California Native Plant Society (CNPS), Sierra Club, California Four Wheel Drive Association, American Sand Association, and the Blue Ribbon Coalition sued after the county approved the project, raising concerns about its impact on oak trees and other natural resources.

Now, Heather Fargo, president of the Environmental Council of Sacramento, said the groups have reached an agreement with the developer that reduces the project’s footprint and adds conservation protections.

“It’s a good settlement agreement from our point of view and obviously it meets their needs as well,” said Fargo.

Under the settlement, the number of blue oak trees that could be destroyed would drop from an initial estimate.

“The initial estimate was 3,500 to 4,000 blue oaks out of an entire woodland were going to be destroyed. And we are now less than 200 will be destroyed. That’s the maximum that they can harm is 200,” said Fargo.

The agreement Fargo says also includes 1,369 acres of on-site conservation, improved wildlife corridors, additional oversight for oak tree replanting, a ban on rodenticides and funding to enhance habitat and propagate rare native plants in the Sacramento region.

Fargo said the groups believe negotiating with the developer produced a better outcome than pursuing the lawsuit to a court victory.

“We can usually get more out of a settlement agreement than we can winning a lawsuit,” said Fargo.

But the settlement does not resolve every obstacle facing the project.

In January, the Sacramento Municipal Utility District announced it was withdrawing from its power purchase agreement for the proposed solar farm. SMUD cited rising costs, supply chain issues, environmental concerns, project delays and pending litigation.

SMUD told ABC10 on Monday that it was not part of the lawsuit and has not received a new proposal. it went onto t say, any future proposal would have to meet all applicable environmental requirements and the utility’s stringent environmental principles.

Gregg Fishman, a SMUD board member, said a separate lawsuit filed by a local tribe is another hurdle.

“There is an additional lawsuit that one of the tribes, the local tribes has filed. Personally, I would want to see that settled before SMUD really gets back into this. We have not heard from the developers whether or not they are going to come back to us with this project again,” said Fishman.

ABC10 reached out to the developer, D.E. Shaw Renewable Investments, for comment but had not received a response.

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