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Thursday, December 14, 2017 by Jessi Devenyns
Electric Utility Commission recommends purchase of more solar power
Austin has a herculean trial ahead of itself as it tries to reach 65 percent renewable energy by 2027. Thankfully, one new proposed project may make that goal achievable.
Despite making up only 4 percent of the Electric Reliability Council of Texas market, Austin Energy’s renewable energy contribution is noteworthy. With its latest proposed project, the city-owned utility will add another 150 megawatts to the AE solar portfolio and will provide nearly a third of the solar energy available on the ERCOT market.
Seizing the chance to allow Austin to rely on an even bigger proportion of green energy, commissioners at the Dec. 11 Electric Utility Commission meeting unanimously decided to recommend that City Council approve Austin Energy’s newest proposed 15-year solar power purchase agreement.
Not only will this project allow Austin to lead the charge into renewable solar energy for Texas, but it will do so at an annual 1.02 percent savings. Robert Cullick, director of communications and marketing at Austin Energy, told the Austin Monitor, “This is the first time costs are going down slightly.”
Erika Bierschbach, AE’s manager of market operations and risk management, told the commission that when this project goes into operation in 2020, the expected reduction in solar power supply adjustment prices will be “somewhere between $4 (million) to $5 million a year.”
Paul Robbins, a longtime renewable energy advocate, told the Monitor that this decrease in prices should come as no surprise. Scales of economy have steadily been reducing prices since Austin began purchasing solar contracts a decade ago and will only continue to do so. Bierschbach confirmed Robbins’ observation and bolstered his argument when she noted that by purchasing this 15-year contract to begin in 2020 instead of 2019, AE will save an estimated $12.2 million.
Although no applicant has been selected to take on the solar farm project, the front-runner is a firm called Intersect Power whose location allows for the production of solar energy later in the day as well as provides Austin Energy with an option to increase the facility size by 30 megawatts to total 180 megawatts of energy production.
Having room to increase production is fairly standard in futures contracts. According to Bierschbach, it allows AE to keep a pulse on what is happening to renewable technology and determine if a small increase in production will help Austin compete favorably within the market. When an increase in production proves to be beneficial, Austin Energy will upsize the facility’s capacity.
Commission Chair Karen Hadden found the opportunity for solar production expansion to be an appealing quality and a good reason to approve the project. “It’s good to see there’s an option to do more,” she said.
Council will consider the purchase at today’s meeting.
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Key Players & Topics In This Article
Austin Energy: As a municipally-owned electric utility, Austin Energy is a rarity in the largely deregulated State of Texas. It's annual budget clocks in at over $1 billion. The utility's annual direct transfer of a Council-determined percentage of its revenues offers the city a notable revenue stream.
Electric Utility Commission: The advisory body charged with oversight of Austin Energy, the City of Austin's municipally-owned electric utility.