Tag Archives: Ppa’s

Los Angeles’s Low-Priced Solar Power Has Problems Coming Its Way

By Cassie McCorkle, Energy Industry Reports

It has been more than a month that Los Angeles has signed a contract for record-cheap solar power and the officials are trying to deny it. The labor union is concerned over Mayor Eric Garcetti’s decision to put an end to the three gas-fired power plants. It has been clearly mentioned in the 25-year contract signed with 8minute Solar Energy that the Los Angeles Department of Water and Power will pay 2 cents per kilowatt-hour or lower. This is the lowest price ever waged for solar power in the US and it is lower than the cost of electricity generated from the natural gas-fired power plant. The Eland project has 200 Megawatts of lithium-ion batteries planned other than the 400 Megawatts of solar power to store solar power for a complete day and to let it into the grid for 4 Hours each night.

The combined payment of L.A. payers for solar power could be 3.3 cents per kilowatt-hour. The concerns of the International Brotherhood of Electrical Workers Local 18 have forced the City Council to not approve the contract. IBEW Local 18 is concerned that Garcetti’s “Green New Deal” initiative has shutdown 3 coastal gas plants and would result in unemployment of 400 LADWP workers. The workers consider Garcetti’s plans to create unemployment and increase electricity prices. Others may consider the current plan as a childlike proposal but as per the Mayor, the Eland project may not replace the large plants instead can help reduce the dependency on gas. The pricing of 8minute that relies on the federal investment tax credit for solar energy is expected to drop by 26% by this year end. By December, the company plans to start construction to be eligible for the 30% tax credit.

Similarly, a 500 MW project is on its way to construction, as per the Kern County Board of Supervisors. This new project is the one more addition to the long list of large projects taking place in California. This project is a part of the Eland 1 Solar Project: 8minutenergy. The project will be started only after the Eland 1 Solar is approved.

Read full article from Energy Industry Reports

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LA & 8Minute Solar ink lowest cost solar-plus-storage deal in U.S. history

By Steve Hanley, CleanTechnica

The Los Angeles Department of Water and Power has signed a groundbreaking 25-year power purchase agreement with 8Minute Solar. The deal will make possible the largest municipal solar plus storage facility in the US. But the best part is the combined price for solar energy plus storage is just 3.3 cents per kilowatt-hour, the lowest ever in the US and cheaper than electricity from a natural gas powered generating plant.

The electricity will come from a massive solar power plant located on 2000 acres of undeveloped desert in Kern County, just 70 miles from the city. Known as the Eland Solar and Storage Center, it will be built in two stages of 200 MW each, with the first coming online in 2022 and the second phase scheduled to be switched on the following year.

Los Angeles DWP will take 375 MWac of solar power coupled with 385.5 MW/1,150 MWh of energy storage, according to PV Magazine. Neighboring Glendale Water and Power will take 25 MWac of solar plus 12.5 MW/50 MWh of energy. The electricity from Eland I and II is expected to meet between 6 and 7% of Los Angeles’ needs, according to PV Magazine.

The Eland Solar & Storage Center has been engineered by 8minute to provide fully dispatchable power under control of the LADWP to meet its customers’ demands with reliable and cost-effective power — a capability previously reserved for large fossil fuel power plants. Eland’s ability to provide fully dispatchable power for less than the traditional cost of fossil fuels effectively positions solar PV as an attractive candidate to be the primary source of California’s 100% clean energy future.

Read full article from CleanTechnica

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Los Angeles has lined up record-cheap solar power. But there’s a problem

By Sammy Roth, Los Angeles Times

Los Angeles has been sitting on a contract for record-cheap solar power for more than a month — and city officials declined to approve it Tuesday because of concerns raised by the city-run utility’s labor union, which is still fuming over Mayor Eric Garcetti’s decision to shut down three gas-fired power plants.

Under the 25-year contract with developer 8minute Solar Energy, the Los Angeles Department of Water and Power would pay less than 2 cents per kilowatt-hour — a number city officials and independent experts say would be the lowest price ever paid for solar power in the United States, and cheaper than the cost of electricity from a typical natural gas-fired power plant.

In addition to 400 megawatts of solar power, the Eland project would include at least 200 megawatts of lithium-ion batteries, capable of storing solar power during the day and injecting it into the grid for four hours each night. The combined price to L.A. ratepayers of the solar and storage would be 3.3 cents per kilowatt-hour — also a record low for this type of contract.

But LADWP’s Board of Commissioners voted not to send the contract to the City Council for approval, after utility staff said concerns had been raised by the International Brotherhood of Electrical Workers Local 18, which represents utility employees. In recent months, IBEW Local 18 has run television and radio ads attacking Garcetti’s Green New Deal initiative, which includes the retirement of three coastal gas plants that employ more than 400 LADWP workers.

…The Eland project, which is planned for the Mojave Desert north of Los Angeles, wouldn’t replace those gas plants. But it could help L.A. reduce its reliance on gas, which has become California’s largest electricity source as utilities look for evening power sources to fill in for solar after the sun goes down.

Read full article in the Los Angeles Times

Opinion: How Lackluster Grid Maintenance Jeopardizes California’s Green Energy Future

By Ariel Cohen (Contributor), Forbes

In Part I of this story, I examined the factors that led to California’s now infamous ‘Camp Fire’ and the bankruptcy of the state’s largest utility, Pacific Gas and Electric Co. (PG&E). It turns out that while climate change, forest mismanagement, and overzealous lawmakers share some of the blame, PG&E is at the center of this multibillion-dollar catastrophe.

But in California, it is ratepayers, shareholders, and green energy that will pay the greatest price. PG&E has been a key partner in California’s green energy agenda, investing aggressively in solar, wind, and other renewable energy projects over the past decade. Last year renewables accounted for 33% of PG&E’s power mix — an impressive amount by industry standards. However, PG&E’s bankruptcy in the wake of the Camp Fire means that a lack of trust (and credit) in the utility could imperil the state’s green energy sector, and with it dreams of 100% carbon-free power by 2045.

Green power is now an uncertain space to do business in California, and we are already seeing the consequences: a major PG&E solar farm – Topaz – had their credit rating downgraded even before PG&E officially filed for bankruptcy, imperiling the clean electricity it provides to roughly 180,000 homes in California. The credit agency Fitch Ratings recently downgraded NextEra Energy’s 250-megawatt Genesis Solar project in the Sonoran Desert, citing its link to PG&E. Others are on the chopping block.

More critically, bankruptcy court might also jeopardize PG&E’s many long-term power purchase agreements (PPAs) with renewable energy providers. From a financial perspective, it makes sense for PG&E to tear up these contracts and start anew. The falling cost of wind and solar means that energy prices negotiated in 2012 and 2013 are three to four times higher per megawatt hour (MWh) than they are today. According to Bloomberg New Energy Finance (NEF), the estimated remaining obligation on these PPAs are more than $2 billion, though they would be worth only around $800 million at current market rates. Restructuring these contracts in court would increase cashflow, affording PG&E a much-needed liquidity boost to help deal with mounting liabilities.

Read full article at Forbes

 

The Looming Bankruptcy Battle Over PG&E’s Renewable Energy Contracts

By Jeff St. John, Greentech Media

If Pacific Gas & Electric goes bankrupt, who gets final say over whether it can renegotiate its old and expensive solar power-purchase agreements — federal regulators or the bankruptcy court?

This multibillion-dollar question has come to the fore as PG&E, overwhelmed by tens of billions of dollars in potential wildfire liabilities, prepares to file for Chapter 11 bankruptcy protection as early as tomorrow.

Last week, PG&E solar provider NextEra asked the Federal Energy Regulatory Commission to use its authority under the Federal Power Act to order the utility not to “abrogate, amend or reject in bankruptcy any of the rates, terms and conditions of its wholesale power-purchase agreements,” including hundreds of megawatts of decade-old solar farms that are selling power at far above today’s market rates. Consolidated Edison, which counts PG&E as an offtaker for nearly one-third of its renewable energy portfolio, also weighed in last week to ask FERC to expedite NextEra’s request.

Late Friday, FERC offered these companies a lifeline, with an order declaring that it has “concurrent jurisdiction” with federal bankruptcy courts over whether utilities in bankruptcy can breach their contracts. But PG&E, even though it hasn’t filed for bankruptcy yet, maintains that a bankruptcy court, not FERC, should decide which PPAs and other power-purchase contracts it can breach and which it can’t. 

Read full article from Greentech Media

SunPower Solar Power Systems Planned for Four Escondido Union High School District Schools

Escondido Union High School District (EUHSD) and SunPower Corp. today announced a power purchase agreement (PPA) under which SunPower will build two megawatts of solar power systems at four district schools. The district estimates that the agreement will offset approximately 75 percent of its annual electricity demand, and save $13.4 million in electricity costs over the next 20 years.

Requiring no upfront capital investment on behalf of the district, the PPA provides EUHSD with competitive electricity rates and a hedge against potential utility rate increases.

“As a result of this agreement with SunPower, Escondido Union High School District will significantly reduce our energy costs, enabling us to apply the savings where they are needed, such as for enhanced academic programs or facility upgrades,” said EUHSD Assistant Superintendent of Business Services. “SunPower’s deep experience working with school districts is as important as the long-term performance of its technology. We are proud to support the development of additional solar power resources in our community.”

Read full press release from SunPower

Related Article: Local schools save with solar panels, batteries (San Diego Union-Tribune) − Dec. 16, 2015

18 schools across California turn to SunEdison to save millions with solar

SunEdison, Inc. today announced that it has signed 20-year power-purchase agreements with six school districts across California. These agreements will see more than 9 megawatts of solar installed at 18 elementary, middle, and high schools throughout the state, and is expected to save taxpayers more than $30 million in energy costs over the next 20 years.

The six unified school districts getting new solar systems are Atascadero, Fairfax, Gilroy, Paso Robles, Templeton, and Tracy. The districts worked with California joint powers authority SPURR to arrange the solar power deals with SunEdison.

Each solar system will be installed on a parking canopy, a roof that sits above parked cars at the school. SunEdison intends to start construction during the first half of 2016, and aims to finish by the third quarter. The solar systems are expected to generate enough energy to offset more than 75 percent of the electricity used by the school buildings. That same amount of electricity is enough to power around 2,200 California homes a year. The systems will also reduce carbon dioxide emissions by more than 170 million pounds over the 20-year period.

Read full press release from SunEdison