Developer Energy Capital Group (ECG) aims for a first half 2015 construction start for its proposed 300MW solar PV project in central Utah, but first must find a long-term buyer for the power, chief executive Josh Case tells Recharge.
The facility, which he estimates will cost $600m, is to be located on 7.1sq km of land that ECG is leasing from the state for 30 years with an option for two, 10-year extensions.
The site provides easy access to a 500kV high-voltage direct current overhead transmission line that links the nearby Intermountain Power Plant (IPP) with southern California, the target market for electricity from ECG Utah Solar I.
The proposed facility will provide power for about 80,000 homes. The developer hopes to have it operational by the end of 2016. That would qualify it for the 30% federal investment tax credit.
Case says ECG has placed the solar project in a queue for an interconnection with the Los Angeles Department of Water and Power (LADWP).
“We’re focused on securing a power purchase agreement with one or more of the six California utilities that have capacity or buying rights on the southern transmission system,” he says. “Our goal is to have the PPA by the end of the year.”
That would facilitate financing arrangements. The six utilities are LADWP, and those serving Anaheim, Burbank, Glendale, Pasadena and Riverside.
The southern transmission system includes the IPP converter station, the 488-mile-long (785km) power line with 2.4GW carrying capacity and a converter station in Adelanto, California. As LADWP operates the system and is the “balancing authority” at the Adelanto substation, ECG Utah Solar I would qualify for the 75% local content requirement in California’s renewable portfolio standard.
“Getting things built and permitted are easier and land costs are lower in Utah than in California,” says Case, which will improve project economics. A balancing authority maintains electrical load resource balance within a given area.
The Los Angeles City Council has approved a plan to eliminate power from coal-fired sources by 2020, now one-third of the city’s electricity mix.
Plans call for LADWP to convert the 1.8GW IPP to a smaller gas-fired facility starting in 2020. Less nameplate capacity will also free up capacity on the transmission capacity to bring more renewable energy to Los Angeles. The plant is now the city’s largest power provider.
LADWP, which obtains about 20% of its power needs from renewable sources, must also meet California’s ambitious 33% mandate by 2020.
Case says ECG is in talks now with potential equity partners for the project, noting that his company is a developer and does not plan to be the sole owner-operator. While not divulging names, interested parties include independent power producers and electric utilities, he adds.
ECG has all required permits from Utah but still needs to do a transportation study and file a dust mitigation plan for construction, and also a hydrology study. Final building permits are needed with Millard County, where the plant will be located.
“In theory, if a PPA were completed today, we could all that done in 120 days at the most,” Case says.