UTILITY TO BUILD 500 MW OF SUN

PG&E To Own, Contract For 500 MW Of Solar Power
Cassandra Sweet,February 24, 2009 (Dow Jones Newswires via CNN Money)

"California utility-holding company PG&E Corp…. plans to develop 500 megawatts of solar power, both through projects the utility would own and through power-purchase agreements...PG&E plans to spend about $1.4 billion to develop 250 megawatts of solar-panel generation that the utility would own and sign contracts with independent developers for the remaining 250 megawatts, all within five years…

"Utilities are becoming increasingly active in developing renewable power, prompted by incentives such as a 30% renewable-investment tax credit recently granted by Congress. In addition, expected federal legislation would require greater use of clean-energy sources like wind and solar, and cuts in emissions of carbon dioxide and other heat-trapping gases blamed for climate change. California utilities are required to use renewable sources for 20% of their retail power by 2010, with pending rules boosting that amount to 33% by 2020."

PG&E is moving up. (click to enlarge)

"…the economic crisis has put added pressure on utilities to help move renewable projects forward, as project financing has largely dried up and smaller companies have had difficulty raising money in the capital markets…[A]t some point in the future, PG&E would be interested in providing financing to renewable-power developers to enable them to build new projects. Such financing might include convertible debt, in which PG&E would make a loan with the option to convert the debt repayment into equity…

"PG&E's solar program will focus on projects from 1 to 20 megawatts in size, with solar panels mounted on the ground or on rooftops, within the service territory of PG&E utility Pacific Gas & Electric Co. The utility will strive to develop projects on land it already owns, near transmission infrastructure to cut costs and delays associated with hooking up to the state's power grid."

click to enlarge

"PG&E has signed renewable-power purchase agreements that represent more than 20% of the utility's future power deliveries…

"Due in part to inadequate transmission capacity, PG&E is unlikely to take actual physical renewable power deliveries worth 20% of its total portfolio by the 2010 deadline. But with state regulations that allow for "flexible compliance" and pending rules that would allow utilities to purchase renewable- energy credits to comply with part of their obligation, PG&E is unlikely to violate any state rules…"