PSO wins Oklahoma ok for PPAs
Public Service of Oklahoma (PSO) has won approval from state regulators for three 20-year contracts to purchase 598.7MW of power from three wind farms that will enter service by the end of 2015.
The deals are for 200MW with TradeWind Energy, which will site its facility near Goodwell in Oklahoma’s Panhandle; 199.8MW with Apex Clean Energy for its wind farm near Balko, also in the Panhandle; and 198.9MW with NextEra Energy from a wind farm in Seiling in northwestern Oklahoma.
“These contracts were based on extraordinary pricing opportunities that will provide substantial savings for our customers,” says PSO President Stuart Solomon. “Another benefit is the diversity that an additional 600MW of Oklahoma wind energy will bring to our fuel mix.”
The utility issued a request for supply proposals to replace a 10-year supply deal for 151MW of wind that expires in 2015. The supplier had already contracted with another buyer after then, PSO spokesman Stan Whiteford tells Recharge.
PSO obtained bids with pricing that was cheaper than either natural gas or coal with the federal production tax credit factored in. It also reflects the excellent wind resource in Oklahoma which enables latest generation turbines to operate at 50-60% capacity.
The pricing was so good that it decided to contract for almost four times as much wind as planned, says Whiteford. PSO estimates in the first year alone, its customers will save $53m in fuel adjustment costs.
When the three new projects come into service, wind will account for 20% of PSO’s overall generation mix and raise contracted wind to 1,137MW.