California Regulators Give Ivanpah Solar Plant More Time
March 17 2016 - 4:20PM
Dow Jones News
California regulators threw a lifeline Thursday to the
struggling Ivanpah solar plant, which has failed to generate the
electricity it is required to produce under contracts with PG&E
Corp.
The California Public Utilities Commission approved without
discussion forbearance agreements that would give the owners of the
plant, BrightSource Energy Inc., NRG Energy Inc. and Alphabet
Inc.'s Google unit, up to a year to work out its problems.
The unconventional solar-thermal project uses more than 170,000
mirrors mounted to the ground to reflect sunlight to 450-foot-high
towers topped by boilers that heat up to create steam, which in
turn is used to generate electricity.
But since opening in 2014, it has angered some environmentalists
by killing thousands of birds, many of which are burned to
death—and has so far failed to produce the expected power.
PG&E's California utility had asked the commission to
approve the agreements, saying that the plant would otherwise be in
danger of shutting down if it failed to meet contractual
requirements.
BrightSource was pleased with the decision, said Joe Desmond, a
senior vice president at the company.
"Performance has steadily improved since the project was
delivered on time and on budget," he said.
The extension was approved over objections from consumer groups,
which wanted PG&E to cancel the contracts or renegotiate them
to get a lower price.
The plant, located about 50 miles southwest of Las Vegas in
California's Mojave Desert, cost roughly $2.2 billion and received
about $1.5 billion in federal loans, according to the Energy
Department.
The plant's two units that serve PG&E are expected to
generate 640,000 megawatt-hours a year, according to documents from
the commission. The units generated 45% of that amount in 2014, and
68% in 2015, according to a Wall Street Journal analysis of federal
and state documents.
The plant isn't required to generate the full amount of power
listed in state documents, according to representatives for NRG and
BrightSource. They declined to say how much it was required to
produce.
PG&E signed the Ivanpah contracts as part of efforts to
comply with a state law that requires utilities to provide 33% of
their power from solar, wind or other renewable sources by 2020.
State lawmakers last year boosted the mandate to 50% renewables by
2030.
A PG&E spokesman said it has more renewable energy than it
needs to meet its current requirement, and is still on track to
meet both mandates.
Write to Cassandra Sweet at cassandra.sweet@wsj.com
(END) Dow Jones Newswires
March 17, 2016 16:05 ET (20:05 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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