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Pacific Gas and Electric to add 500 MW of solar PV power; SEPA applauds plan

24 February 2009 | By Tom Cheyney | News > Power Generation

pge_panels Pacific Gas and Electric has annnounced plans for a five-year program which, if approved, would lead to the development of up to 500 MW of solar photovoltaic power in its northern and central California service area, one of the largest undertakings of its kind in the United States. The proposed program consists of up to 250 MW of utility-owned PV generation--the utility's first direct investment in renewable generation in more than a decade--and an additional 250 MW to be built and owned by independent developers under a streamlined regulatory process.

PG&E said it is submitting its plan today to the California Public Utilities Commission for approval, which could come later this year.

If all projects are up and running by 2015, they would provide deliver more than 1000 GW-hours of power each year, equal to the annual consumption of about 150,000 average homes. In all, this program would meet more than 1.3% of PG&E's electric demand, according to the utility.

PG&E's solar program will target midsized projects, typically between 1 and 20 MW, ground mounted or on rooftops, within its service area. Where feasible, projects developed and owned by the utility would be built on land already owned by PG&E or near its substations to minimize the cost and delays of interconnecting them to the power grid.

Projects developed by independent parties would be offered a standard contract and pricing derived from the utility's own costs to streamline review of their applications, according to the utility.

"This program represents an unprecedented commitment of our capital and expertise to speed the delivery of clean, renewable energy to our customers," said Peter Darbee, PG&E's CEO/president. "With many renewable-energy projects delayed, we can't afford business as usual when it comes to protecting the environment and meeting our customers' expectations."

"According to nationwide data collected by the Solar Electric Power Association, as of the end of 2007 more than 50% of all photovoltaic systems in the country were located in PG&E's service territory," said Julia Hamm, SEPA executive director, in a statement applauding the plan. "PG&E continues to demonstrate its leadership role with the announcement of this new 500 MW program, as well as last year's announcement of plans to purchase the output of two PV plants totaling 800 MW."

"Utility companies around the U.S. are exploring ownership of solar projects now that they have access to the 30% investment tax credit, making solar energy much closer in cost to other resource options," continued Hamm. "A number of utilities have announced programs for utility-owned solar projects in the past six to eight months, including Southern California Edison, San Diego Gas & Electric, Duke Energy, and most recently, PSE&G in New Jersey. We expect many other similar programs to emerge in the coming months."

Referring to the second half of PG&E's new initiative, wherein projects developed by independent parties will be offered a standard contract and pricing derived from the utility's own costs, Hamm noted that "it's refreshing to see PG&E take a simplified procurement approach that ultimately helps drive down the nontechnology costs related to solar projects."

Gov. Arnold Schwarzenegger also commented on the PG&E plan. "By bringing renewables online as quickly as possible and advancing the development of green technologies, this effort will advance California's aggressive push to meet our long-term energy and climate change goals while keeping California on the leading edge of this booming industry."