SoCal Edison says solar plants to be built
Southern California Edison will pair with Arizona company First Solar Inc. on two large solar power projects in Riverside and San Bernardino counties that will be able to supply electricity to as many as to 170,000 homes, the companies said Tuesday.
The installations operating at full power can produce up to 550 megawatts of photovoltaic electricity. By comparison, an average natural-gas-fueled power plant produces roughly 1,000 megawatts.
First Solar will begin building the 250-megawatt Desert Sunlight facility near Desert Center in Riverside County in 2012 and the 300-megawatt Stateline project in northeastern San Bernardino County in 2013. Both installations, to built mostly on public land, are expected to be finished in 2015 and to create hundreds of construction jobs.
Financial terms of the deal and the anticipated cost of the electricity weren’t disclosed. Edison will buy the power from the facilities, which First Solar plans to sell to investors by the time construction is complete.
First Solar, which has manufacturing facilities in Ohio, France, Germany and Malaysia, will use thin-film cadmium telluride panels for the projects, known as solar farms.
The projects, which are expected to produce up to 1.2 billion kilowatt-hours of energy each year, will help Edison inch closer to the state goal of deriving 20% of all electricity from renewable sources by 2010. The California Legislature is considering bumping up the state target to 33% by 2020.
Last year, 16% of Edison’s energy portfolio fit the bill. In the same period, the company delivered more than 65% of the solar energy produced in the country to its customers.
The Rosemead utility has been busy building up its solar infrastructure. In February, the company struck a deal with BrightSource Energy of Oakland to build seven solar farms, the first of which could be operating in 2013 in Ivanpah, Calif. With a production capacity of 1,300 megawatts, the project could end up powering nearly 845,000 homes.
The utility also agreed in June to buy power from two projects with German company Solar Millennium for a potential 726 megawatts. The projects, to be located in Blythe and Ridgecrest, Calif., would start up in 2013 and 2014.
But with the prolonged timeline and strict regulations on how to direct the energy to consumers, utilities may miss the state’s goal, Edison spokeswoman Vanessa McGrady said.
“By 2010, we will meet or exceed the necessary contracts, but the hurdle is transmission,” she said. “Due to policy constraints we will probably not be delivering the full 20% by that date.”
First Solar, meanwhile, is at the forefront of photovoltaic companies, experts said.
A note to investors from Pacific Crest Securities said First Solar had a “substantial backlog” of long-term contracts and had been able to “lower manufacturing costs faster than its competitors.”
The Edison projects could bring First Solar as much as $1.3 billion in revenue, analysts said.
First Solar already has a 21-megawatt solar farm with power slated for Edison under construction in Blythe, and a 550-megawatt project with Pacific Gas & Electric Co. in San Luis Obispo County.
In an estimated $400-million deal in March, the company bought the unfinished projects and land rights of OptiSolar, a start-up competitor. The Edison proposal was among them.
“These are pretty massive projects,” said John Carrington, First Solar’s executive vice president of marketing and business development. “This is a big deal.”
The company’s revenue has boomed from $1.3 billion in 2008 to an estimated $2.1 billion in 2009. First Solar shares fell $1.31 to $133.12 on Tuesday. Shares for Southern California Edison’s parent company, Edison International in Rosemead, rose 35 cents to $32.03.