Month: September 2019

California firm contracts ‘astoundingly’ cheap solar-plus-storage pipeline

The US state of California has witnessed yet another claim of ultra-low solar prices, recorded in the context of a major contracting exercise by a community energy group.

The board of East Bay Community Energy (EBCE), the power supplier of San Francisco-neighbouring Alameda County, waved through deals last Friday to acquire 225MW of solar and 80MW / 160MWh of battery energy storage.

The late September procurement – coming off the back of earlier deals in June and July – brings EBCE’s purchase pipeline volumes up to 550MW of clean energy and 137.5MW / 390MWh of energy storage, set to supply residents in Oakland and others in the county.  

According to EBCE, the solar portfolio resulting from this year’s procurement raft was contracted at average prices of US$22/MWh. Commenting on the latest deals on social media, the group’s CEO Nick Chaset described the figure as “astoundingly low”.

One of the newest two deals will see EBCE acquire the entire output of sPower’s Solar + Storage Project, set to mix PV (125MW) and batteries (80MW / 160MWh). The buyer will have “full control” to tap the storage battery as required by the peaks and troughs of solar generation.

The second deal concerns the 100MW Edwards Solar Project Terra-Gen is developing within a 600MW complex at the Edwards Airforce Base, in Kern County. According to EBCE, the agreement foresees the possibility of rolling out energy storage systems onsite.

Edwards’ “solar plus virtual storage” contract means Terra-Gen can install and run batteries to protect the project from negative pricing, EBCE said, adding: “[We have] the right to procure resource adequacy in the event storage is added.”

Cheap solar draws eyes to Golden State

For EBCE, the sPower and Terra-Gen projects cleared in September will sit alongside schemes – including EDPR’s 100MW / 30MW solar-plus-storage venture in Fresno – it gave the green-light to earlier this year all across California.

The contracts will see PV developers back EBCE’s community investment scheme with contributions of US$1 million, with a commitment to use union-backed labour and sponsor training hours for volunteers and others.

The EBCE deals look set to cement California’s status as home to some of the cheapest solar ventures in the US. A solar-plus-storage project claiming to offer the country’s lowest solar tariffs – US$19.97/MWh – has cleared various planning hurdles in Los Angeles.

Designed with a total 400MW of solar arrays and up to 1,200MWh in battery systems, 8minute Solar Energy’s Eland hybrid bagged earlier in September 25-year power purchase agreements from the LA Department of Water and Power (LADWP).

However, some in the solar ranks have questioned whether ultra-cheap Eland can remain money-making for 8minute. Writing for PV Tech in August, Gensol Group vice president Ali Imran Naqvi said his firm’s modelling would see the developer reap equity returns of only 5%.

LA authorities recently moved to triple the size of the city’s rooftop solar feed-in tariff programme, in a bid to build momentum towards clean energy goals. Under current targets, LADWP’s current renewable share of 31% should grow to 55% by 2025, 80% by 2036 and 100% by 2045.

US solar prospects amid PPA uptake and a changing policy landscape will take centre stage at Solar Media’s Solar & Storage Finance USA in New York on 29-30 October 2019

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Lightsource BP to power historic Colorado steel mill with 240MW solar plant

Lightsource BP will build and operate a 240MW solar facility that will sell energy to Midwestern utility Xcel Energy to power operations at a historic Colorado steel mill for 20 years.

The project partners, which count steel maker EVRAZ North America, are touting the project as the largest on-site solar facility dedicated to a single customer in the US.

The US$250 million solar plant will be located on EVRAZ’s Rocky Mountain steel property in the central Coloradan city of Pueblo. The array will provide energy to the mill through a 20-year power purchase agreement (PPA) signed with off-taker Xcel Energy, Colorado’s largest utility.

The project is expected to start operating in 2021 and the deal will give the steel mill “price certainty” through 2041, according to the three companies.

The mill, which started operating in the late 19th century, currently employs 1,000 people. Construction and maintenance of the solar plant is expected to generate a further 300 jobs, alongside US$22 million in property tax revenue.

The deal is subject to a final review by Colorado’s utilities commission.

Xcel Energy intends to deliver 55% renewable energy to the grid by 2026. EVRAZ North America is its largest retail electricity customer.

Colorado’s Democratic Governor Jared Polis wants the state to be powered entirely by renewable energy by 2040, with voluntary processes set out in mid-2019 to help industry reach that aim.

Lightsource BP, the British-headquartered solar arm of oil major BP, claims to have a US solar pipeline larger than 4GW. This month, it secured US$140 million in financing for a portfolio of seven utility-scale PV projects across the US, including a 70MW trio of facilities in Pennsylvania that broke ground two weeks prior. It is also developing an 130MW PV projet in Alabama.

EVRAZ North America is part owned by Roman Abromovich and is a subsidiary of Russia’s largest steel producer EVRAZ.

US solar prospects amid PPA uptake and a changing policy landscape will take centre stage at Solar Media’s Solar & Storage Finance USA in New York on 29-30 October 2019

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California marks feed-in-tariff and community solar milestones

Los Angeles’ municipal utility has tripled the size of its rooftop solar feed-in programme (FiT), growing it from 150MW to 450MW.

Commissioners from the LA Department of Water and Power (LADWP) – which serves the second most customers of any public utility in the US – voted to expand the scheme on Wednesday.

The FiT programme was launched in 2013 and reached capacity earlier this year. It has been billed as the largest rooftop solar programme in the US since its inception.

Under the city-wide scheme, homeowners sell power generated from their rooftop solar racks to the local utility.

More than 40% of installations in the programme are in disadvantaged communities, according to an analysis quoted by the Los Angeles Business Council, one of the programme’s original backers. The Council, which urged LAWDP in April to expand the FiT scheme, estimates the pilot has generated more than US$500 million in investments.

LADWP generated 31% of its energy from renewable sources as of mid-September, which LA Mayor Eric Garcetti wants to push to 55% by 2025, 80% by 2036 and 100% by 2045. Earlier this month, the utility endorsed a solar-plus-storage scheme – 8minute Solar Energy’s Eland – billed as the cheapest such hybrid in US history. 

California’s south witnesses 30MW community solar launch

Further southeast in the Golden State, a 30MW community solar project was switched on by its backers, public power provider Imperial Irrigation District (IID) and Citizens Energy Corp, a non-profit that channels energy revenues to disadvantaged communities.

The 107,000-panel project is located on a 200-acre plot of land near a substation in Imperial County and is contracted to sell power to the IID grid under a 23-year power purchase agreement (PPA).

The project backers claim that it is “one of the largest low-income community solar projects in the nation” with a “unique” structure and implementation.

The power provider estimates that the project will serve more than 12,000 customers in the “economically stressed desert area.”

State senator Jeff Stone attended the project launch. “This project is a win-win-win: It’s good for the planet, good for low-income families, and fulfils the mission of IID and Citizens Energy to serve those in need,” he said.

The power producer runs a ‘residential energy assistance programme’ which wants to use the array’s output to save costs for customers, via monthly discounts on electric bills.

The project’s construction is estimated to have required US$46 million in investment.

US solar prospects amid PPA uptake and a changing policy landscape will take centre stage at Solar Media’s Solar & Storage Finance USA, to be held in New York on 29-30 October 2019

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Microsoft to buy 230MW from Engie’s clean energy duo in Texas

Microsoft has purchased 85MW of solar energy from Engie as part of a broader agreement covering 230MW of clean energy generated by the developer’s Texas operations.

The solar energy will be produced at Engie’s 200MW Anson solar centre in central Texas, estimated to come online in January 2021. The remainder of the deal’s energy will be procured from the developer’s 200MW Las Lomas wind project in south Texas.

The length of the “long-term” power purchase agreement (PPA) has not been disclosed.

The partners hope that an “innovative volume firming agreement” (VFA) incorporated into the deal will set an example to industry as a procurement solution that makes PPAs less risky for buyers. According to a joint statement, the VFA “will convert the intermittent renewable energy supply into a fixed 24/7 power solution aligned with Microsoft’s energy needs.”

The PPA will bring the software giant’s renewable energy portfolio to 1.9GW, according to the release.

A report published in September by Wood Mackenzie and the Solar Energies Industry Association said Microsoft was at the forefront of a boom of corporate solar procurement activity in the US. Seventeen percent of utility-scale capacity announced US-wide so far in 2019 were offsite corporate projects, according to the report.

So far this year, Microsoft has purchased 74MW of solar energy from Invenergy in North Carolina and inked a 150MW deal with First Solar in Arizona.

Engie has pre-existing relationship with the tech firm. Its plant data management platform, Darwin, relies on Microsoft’s cloud services.

US solar prospects amid PPA uptake and a changing policy landscape will take centre stage at Solar Media’s Solar & Storage Finance USA, to be held in New York on 29-30 October 2019

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Lightsource BP completes financing for 125MW US portfolio

Lightsource BP has secured US$140 million financing for a portfolio of seven utility-scale PV projects across the US.

The projects span four states and have long-term power contracts covering 20 to 25 years.

Three projects – Whitetail Solar 1, 2 and 3 – are located in Franklin County in Pennsylvania and are set to provide power to Penn State University. Lightsource BP broke ground on the trio earlier this month.

The Grants Solar and Bluewater Solar projects in Cibola Country, New Mexico, will provide power to the Continental Divide Electric Cooperative.

The Johnson Corner Solar project in Stanton Country in Kansas was announced in early 2018 and has a 25-year PPA in place with utility Mid-Kansas Electric Company.

The last project, the Wildflower Solar project in Sacramento County in California, has an agreement to provide power to the Sacramento Municipal Utility District.

The tax equity financing for the portfolio was secured from Rockwood Group through its partnership with Fortune 250 Guardian Life Insurance Company of America.

NatWest is the senior project finance debt lender, having a long-standing relationship with Lightsource BP, as well as the wider solar industry. NatWest most recently provided a £65 million (around US$80 million) revolving credit facility (RCF) to Foresight Solar Fund for the debt refinancing of a UK portfolio.

The balance of the equity requirements will be invested by Lightsource BP. CohnReznick Capital acted as Lightsource BP’s advisor for the deal.

Kevin Smith, CEO of the Americas for Lightsource BP, said the transaction demonstrates “the quality and bankability” of Lightsource BP’s developed assets.

“Lightsource BP is committed to progressing solar energy across the US, energizing cleaner communities and boosting local economies while saving power buyers millions of dollars through low-cost solar energy procurement,” Smith added.

Lightsource BP has been making a flurry of announcements in recent months as it looks to bolster its global pipeline. In May it secured multi-million debt financing for the development of a global 700MW-plus solar pipeline and has since announced projects in Alabama and South Australia. The solar developer also acquired a 1.9GW portfolio in Brazil in July.

US solar prospects amid PPA uptake and a changing policy landscape will take centre stage at Solar Media’s Solar & Storage Finance USA, to be held in New York on 29-30 October 2019

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Engie buys 25MW/22MWh solar-plus-storage pipeline in Massachusetts

Engie North America has bought a four-project portfolio in Massachusetts that comprises 25MW of solar and 22MWh of energy storage.

It is one of a “number” of solar-plus-storage portfolios that will be deployed by Engie under the state’s solar incentive programme, the Solar Massachusetts Renewable Target (SMART), according to a company release.

The new projects are expected to be operational by the second half of 2020 and run for 20 years. The energy storage systems will use Engie’s GridSynergy software platform and will operate in the ISO New England wholesale markets.

The new projects will add to Engie’s purchase of a 19MW/38MWh solar-plus-storage pipeline in the New England state in July.

See here to read the full story on our sister site Energy-Storage.News.

US solar prospects amid PPA uptake and a changing policy landscape will take centre stage at Solar Media’s Solar & Storage Finance USA, to be held in New York on 29-30 October 2019.

Read the entire story

Engie buys 25MW/22MWh solar-plus-storage portfolio in Massachusetts

Engie North America has bought a four-project pipeline in Massachusetts that comprises 25MW of solar and 22MWh of energy storage.

It is one of a “number” of solar-plus-storage portfolios that will be deployed by Engie under the state’s solar incentive programme, the Solar Massachusetts Renewable Target (SMART), according to a company release.

The new projects are expected to be operational by the second half of 2020 and run for 20 years. The energy storage systems will use Engie’s GridSynergy software platform and will operate in the ISO New England wholesale markets.

The new projects will add to Engie’s purchase of a 19MW/38MWh solar-plus-storage pipeline in the New England state in July.

While Engie develops and operates distributed solar across the US, the new portfolio is “one of the first” that combines solar and storage “at scale,” according to the company.

Engie Storage chief executive officer Christopher Tilley noted that “innovative storage and solar-plus-storage initiatives in New England are now taking root, and we are seeing the emergence of this industry after years of behind-the-scenes market development.”

SMART was launched in September 2018 and works through tariff-based incentives. Three of the state’s investor-owned utilities, National Grid, Eversource and Unitil, pay participating solar energy projects for contributing solar energy to the grid.

US solar prospects amid PPA uptake and a changing policy landscape will take centre stage at Solar Media’s Solar & Storage Finance USA, to be held in New York on 29-30 October 2019.

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Honda jets to car industry’s ‘largest’ clean energy buy with 320MW PPA duo

Japanese carmaker Honda has clinched the car industry’s supposedly “largest” renewable energy deal, signing a duo of virtual power purchase agreements (VPPAs) for 320MW of wind and solar to power its US operations.

The agreements, which cover 120MW of wind from an Oklahoma farm being developed by E.On and 200MW of solar from Texas, will offset 1.012 million MWh of fossil-fuel powered electricity currently generated by the carmaker annually.

Honda will purchase 482,000 MWh each year from an under-construction solar facility in Texas, starting in the autumn of 2021. The specifics of the project will be shared in 2020, according to Honda. The firm will start purchasing wind power from E.On next fall.

The car company hopes the deals will ensure that 80% of its electricity generation in the US is renewable – a leap from the 21% it currently sources from “extremely low” carbon and carbon-free sources.

VPPA designed to counter power price volatility

In order to mitigate financial risk, Honda has turned to an “innovative contract structure” for its wind VPPA. It sets upper and lower bounds for the firm’s exposure to energy market price fluctuations in any given quarter.

“We hope the addition of a “collar” to the Boiling Springs [wind] project will encourage other companies to consider VPPAs as a method to secure renewable power and reduce climate-altering carbon emissions,” said Ryan Harty, manager of connected and environmental business development at American Honda, in a statement.

In virtual power purchase agreements, off-takers pay a fixed price for the electricity that a power project produces and sells into the wholesale market. In return, the project transfers to the company renewable energy certificates (RECs) associated with that electricity – in other words, credits for the energy produced from the wind or solar project.

In Honda’s case, the RECs will go towards offsetting emissions from its Alabama, Ohio and Indiana operations.

US solar prospects amid PPA uptake and a changing policy landscape will take centre stage at Solar Media’s Solar & Storage Finance USA, to be held in New York on 29-30 October 2019.

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US energy regulator moves to limit mandatory renewable purchases

Solar representatives have cautioned against a move to overhaul US rules that have guided utilities’ mandatory renewable purchases for decades, setting the scene for a policy clash.

Recent proposals by the US Federal Energy Regulatory Commission (FERC) to reform the so-called PURPA Act risk putting the brakes on competition, US solar body SEIA said last week.

Passed in 1978, the Public Utility Regulatory Policies Act has in the decades since mandated public utilities to procure energy from small producers, defined as qualifying facilities (QFs).

Regulator FERC is now suggesting to lower the maximum capacity threshold – from 20MW to 1MW – for QF projects to be able to benefit from compulsory energy purchases by utilities.

The proposed change, lawyers believe, would relieve most utilities in organised wholesale markets from procuring energy from QFs above the 1MW capacity mark.

“QFs larger than 1MW would no longer be presumed to lack nondiscriminatory access to markets,” Akin Gump Strauss Hauer & Feld said in a recent policy note.

FERC has justified the move by pointing at the “maturation” now reached by small power producers, a market it claims is now “improved and better understood”.

‘Not a fledgling industry anymore’

For its part, US PV body SEIA has now spent weeks arguing PURPA protection remains “crucial” to protect independent solar producers from some utilities’ “monopoly” ambitions.

Speaking after the new FERC proposals, the solar association urged the regulator to rethink the “most harmful portions” of its new draft document.

“Rather than focusing on PURPA’s goal of ensuring competition, this proposal would have the effect of dampening competition and allowing utilities to strengthen their monopoly status, to the detriment of customers,” SEIA’s regulatory affairs VP Katherine Gensler said in a statement.

FERC’s intentions to weaken renewable purchase obligations have been apparent for years. “Renewable generation is not a fledgling industry anymore…[it] no longer needs to be supported by PURPA,” the regulator claimed in 2016, as it first launched its review into the Jimmy Carter-era legislation.

The revision it proposed last week would pile further requirements on QFs, forcing them to prove commercial viability and financial support for projects before they can be deemed eligible for mandatory utility purchases. 

For US solar, the PURPA setback marks a bleaker turn of events after the industry helped settle a dispute with a Michigan utility, freeing a 584MW PV pipeline from years of standstill over obligations under the act.

US solar prospects amid PPA uptake and a changing policy landscape will take centre stage at Solar Media’s Solar & Storage Finance USA, to be held in New York on 29-30 October 2019

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Google bets on cheap solar via ‘biggest’ clean energy buy to date

Tumbling solar costs have spurred Google on to a dramatic boost of its exposure to the technology, acting to line up supply from projects worldwide as part of a major clean energy push.

On Thursday, the technology giant unveiled plans to purchase a whopping 1.6GW of renewable electricity via 18 separate deals across the globe, featuring solar and wind projects.

The clean energy procurement ramp-up – reportedly the largest in Google’s history – will see the firm double its existing global volumes of contracted solar power, according to CEO Sundar Pichai.

In a statement, Pichai explained 720MW of the worldwide 1.6GW will be secured from US solar projects, split between Texas (490MW), North Carolina (155MW) and South Carolina (75MW).

Where Google’s US clean energy buys to date were “wind-driven”, solar cost declines of 80% in the past decade have made “harnessing the sun increasingly cost-effective”, Pichai said.

Lower costs whet PV appetite for cloudy Denmark

Google’s solar appetites will also take the corporate to Chile, where a 125MW new venture will pair solar with wind in a bid to maximise clean energy power coverage.

The project – the firm’s first such hybrid buy – will allow Google to match its Chilean data centre with carbon-free electricity for a “larger portion of each day”, CEO Pichai pointed out.

The executive noted that 793MW of the 1.6GW will be supplied by European projects, planned in Finland (255 MW), Sweden (286 MW), Belgium (92 MW), and Denmark (160 MW).

Contacted by PV Tech today, a person with knowledge of the clean energy push said Denmark’s 160MW – a five-project pipeline – is Google’s only new PV deal in Europe, the rest being wind.

Google, this publication understands, has not historically seen cloudier Denmark as a prime solar location but technology cost drops have prompted a rethink.

In Denmark, where regulators foresee a multi-gigawatt solar boom within decades, the 160MW of PV will power Google’s first data centre in the country, already being built.

All new plants, all set to go live in 2022

The 1.6GW move brings Google’s cumulative clean energy portfolio up to 5.4GW, a marked jump from the procured volumes in 2016 (2.3GW), 2017 (2.9GW) and 2018 (3.8GW).

As noted by CEO Pichai, the corporate’s long-running “additionality” principles mean the fresh 1.6GW in contracted supply will come exclusively from new plants.

Once all 1.6GW are live – all plants should be ready by late 2022, PV Tech understands – the resulting 5.4GW portfolio could power entire countries such as Lithuania or Uruguay, Pichai added.

Even before this week’s major procurement effort, Google was with Amazon and Facebook one of top three clean energy offtakers in the US, where corporate PV appetite is on a sharp rise.

In Europe, all three technology a-listers added their names to a letter in June urging the bloc to enact PPA-friendly legislation, bringing down regulatory obstacles at national level.

US solar prospects amid PPA uptake and a changing policy landscape will take centre stage at Solar Media’s Solar & Storage Finance USA, to be held in New York on 29-30 October 2019

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