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Solar Expected to Make Up 40 Percent
of PG&E's Renewable Portfolio by 2020

by Dana Hull
San Jose Mercury News, July 25, 2012

Solar power, which makes up a tiny part of California's overall energy mix, will account for the biggest piece of the state's renewable energy pie by the end of the decade, according to the state's largest utilities.

Last year, Pacific Gas & Electric got most of its renewable energy from wind, bioenergy, geothermal and small hydropower dams. Solar accounted for about 1 percent. But that mix is quickly changing, and by 2020, the San Francisco-based utility expects solar to account for 40 percent of its renewable portfolio.

California's aggressive "Renewable Portfolio Standard" law requires utilities to purchase 33 percent of their electricity from renewable sources by 2020. Bioenergy, geothermal, solar, wind, wave and tidal power and small hydroelectric dams -- which cause less harm to the environment than large hydro dams -- all count toward meeting the law.

But solar is the fastest-growing piece of renewable portfolios, driven by federal stimulus funding for large solar power plants, a drop in solar panel prices and a boom in the number of developers competing for long-term utility contracts in California.

"We're about to see solar on a project scale larger than almost anywhere in the world," said Aaron Johnson, director of renewable energy policy and strategy at PG&E. "Planning for the 33 percent began four or five years ago. There's no way to get from here to there without solar."

Roughly 20 percent of retail electricity sales last year by California's three large investor-owned utilities -- PG&E, San Diego Gas & Electric and Southern California Edison -- came from renewable power, according to a report by the California Public Utilities Commission. The 33 percent target by 2020 is widely believed to be well within reach, and some state policymakers are already talking about increasing the target to 40 percent.

"Solar is getting very competitive -- the costs are coming down significantly," said Jim Baak, director of utility-scale solar policy at the Vote Solar Initiative in San Francisco. "Contracts are coming in at a much lower price."

Though some renewable projects will experience delays, utilities typically "over-contract" for energy from new facilities, building in wiggle room in case projects fail and never get built.

San Diego Gas & Electric recently completed the 117-mile-long Sunrise Powerlink, a 500,000-volt transmission line linking San Diego to the Imperial Valley, one of the most solar-rich regions in California.

"Right now we barely have any solar. It's mostly wind," said Jennifer Ramp, a spokeswoman for SDG&E. "But we're about to see a huge jump. A third of our renewable power will come from solar in 2020, and possibly as early as 2016. The bulk of our solar projects are out in the Imperial Valley."

Southern California Edison got about 6 percent of its renewable energy from solar last year; the utility says solar could be 40 percent of renewable generation by 2020.

Utility-scale solar power plants use either traditional photovoltaic panels or "solar thermal" technology, where the sun is used to create steam that turns turbines to generate electricity.

Since the start of California's renewable energy program in 2002, PG&E has signed 27 solar photovoltaic contracts totaling 2,376 megawatts and 14 solar thermal contracts totaling 2,735 megawatts.

Several massive solar power plants are under construction and scheduled to come online between 2012 and 2015. Arizona-based First Solar is building several photovoltaic plants across the Southwest, and some out-of-state solar projects will feed electricity into California's grid. The 290-megawatt Agua Caliente plant in Yuma County, Ariz., will provide electricity for PG&E. More than 200 megawatts are already connected to the grid, and the full plant should be finished in 2014.

One megawatt is enough to power about 750 to 1,000 homes. But because the sun doesn't shine all the time, solar industry experts typically use a conservative figure and say that 1 megawatt of solar power capacity is sufficient to power about 200 households. Companies typically put out their own estimates; First Solar says that Agua Caliente will produce sufficient electricity to power about 100,000 average homes per year.

Oakland-based BrightSource Energy is building the 370-megawatt Ivanpah project on federal land in the Mojave Desert; the electricity will be sold to both PG&E and Southern California Edison. The project should come online early next year.

In eastern San Luis Obispo County, construction is under way on two large solar farms that are visible from each other: First Solar's 550-megawatt Topaz Solar Farm, scheduled for completion in early 2015, and SunPower's (SPWRA) 250-megawatt California Valley Solar Ranch, which should be operational in 2013. SunPower expects the first 25 megawatts of the project to begin producing electricity in September.

"They are both full steam ahead. CVSR is a little further along, but Topaz is in full swing," said John McKenzie, the county's senior planner. "There are hundreds of construction workers out there."

Dana Hull
Solar Expected to Make Up 40 Percent of PG&E's Renewable Portfolio by 2020
San Jose Mercury News, July 25, 2012

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