The Public Service Commission of the District of Columbia (DCPSC) has approved a 15-year power purchase agreement (PPA) with renewables developer Invenergy for 73MW of solar power to meet a 5% renewables target for district’s default electricity supply.
The contract is the first of its kind from a utility regulator in the Mid-Atlantic because it will serve as the Standard Offer Service (SOS) electricity supply load, which is the electricity supply from utilities to customers who do not choose alternative suppliers, beginning in December 2024.
Utility companies usually purchase SOS electricity from wholesale suppliers under a competitive bidding process regulated by the Commission. In this case, customers under the SOS programme can buy default electricity generation from Pepco, a utility provider for nearly 900,000 customers in the District of Columbia and Maryland, instead of from around 45 other competitive and unregulated electricity suppliers.
About 31% of Pepco’s total electricity supply sales came via the SOS program last year. Meanwhile, around 78% of total residential electric utility sales in the district also came through Pepco’s SOS power supply.
The new pilot programme was driven by the Commission’s directive to procure renewable energy through long-term PPAs for energy generated by solar or wind power facilities located within the PJM Interconnection (PJM) region.
The contract with Invenergy includes a levelised pricing agreement for roughly 154,000MWh per year. This corresponds to 73MW, or about 29% of the PV project’s total capacity.
“Today’s action marks another aggressive step the Commission is taking to move the District closer to meeting its 2032 100% renewable energy goal, as well as the climate change commitments,” said Emile Thompson, Commission chair.
“By incorporating the long-term renewable energy PPA into the SOS procurement portfolio, we are taking direct action to reduce greenhouse gas emissions by promoting the construction of new renewable energy generation within the PJM Interconnection grid region. This pilot program is the product of a collaborative, comprehensive, and transparent SOS Working Group process.”
Thompson also noted intentions to participate with the SOS Working Group again in the future to explore the expansion of the percentage of SOS load served by renewable energy PPAs in the near term.
In May, Invenergy said it had achieved the milestone of reaching 30GW of clean energy generation projects over its 20-year existence. It claimed to be the first privately held energy company to achieve this milestone.
This includes 6GW of solar across 50 projects and more than 1GW of energy storage across 18 projects.
Last week Invenergy signed an agreement with CenterPoint Energy to develop the 130MW Pike County solar plant in Indiana, while in July, Invenergy announced it was launching a green hydrogen project that will be co-located with a solar farm in the US state of Illinois. The Sauk Valley Hydrogen Project will feature a proton exchange membrane (PEM) electrolyser from manufacturer Ohmium.
PJM Interconnection’s latest capacity auction for 2023/24 saw 1,868MW of solar PV procured, up 25% from the previous auction, and with a significant drop in prices.
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