PV energy provider, SunEdison, has acquired a 156MW solar power plant in the US state of Colorado.
The company’s spin-off yield co vehicle, TerraForm Power, which launched its initial public offering last week, will have the option to buy the project once it is complete.
SunEdison acquired the plant from Colorado wind and solar developer, Community Energy, with construction scheduled for 2015 reaching commercial operation by mid-2016.
Named, the ‘Comanche Solar Project’, energy from the plant will be sold to utility, Xcel Energy, under a 25-year power purchase agreement (PPA) with SunEdison.
SunEdison has claimed the rate decided for energy in the PPA will be competitive with natural gas price projections.
The project is part of a goal to bring utility-scale solar energy at a competitive price to Front Range Colorado, said Eric Blank, president of Community Energy.
“Solar energy is now an economical choice for utilities across America,” said Bob Powell, president, North America at SunEdison.
Powell also said SunEdison’s cooperation with other developers is to show utility customers “how solar energy can serve both the bottom line and their community's desire for clean energy”.
Pueblo County economic development director, Chris Markuson said the solar project is a “huge win for our community”, and demonstrates solar is “ready for prime-time”.
“We want to make sure that solar energy policy encourages the development of solar energy in a transparent and sustainable manner,” added David Eves, president and CEO of Xcel Energy.
The Comanche Solar power project is currently in the final stage of development, for completion SunEdison is to partner with Community Energy, providing finance and procurement expertise.
The plant is to use 900 acres of desert land and utilise 400,000 SunEdison monocrystalline PV modules.
Power from Comanche will also help to supply Xcel’s peak daytime demand for air conditioning.
SunEdison will also manage construction and operations and maintenance.
SunEdison is among the first wave of solar companies to set up a yield co to own PV projects and use them as an ongoing source of capital. The model is becoming increasingly popular as investors latch on to the prospect of steady, relatively low-risk returns offered by PV power plants.
TerraForm Power’s IPO which opened a week ago exceeded expectations, generating US$535.5 million and a further US$65 million from the sale of stock in private placements.