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A 290-megawatt project and the largest solar-panel power plant in the world has risen in Arizona and will send electricity to California under a 25-year contract, its owners said Tuesday.
The project, owned by NRG Energy NRG -0.64% and MidAmerican Solar, sits on 2,400 acres between Yuma and Phoenix. They hired Arizona-based First Solar FSLR -2.24% to build and operate the project, which also uses First Solar’s thin film solar panels that rely on a compound of cadmium-telluride to convert sunlight into electricity.
Called Agua Caliente, the project will ship electricity to San Francisco-based Pacific Gas and Electric Co. At maximum production, the project will generate enough electricity for about 230,000 homes. Solar electricity production depends heavily on the weather, however. A cloudy and rainy day will cut the solar farm’s production significantly.
We’ve seen a growing number of large solar power projects (over 100 megawatts each) coming online in California and Arizona in the last few years. The construction boom reflects state policies to replace fossil fuel power generation with cleaner energy sources. California, for example, requires its utilities to get 33% of their electricity supplies from renewable sources by 2020.
Pacific Gas and Electric received its first flow of solar electricity for meeting the renewable energy mandate in January 2009. The solar power came from a 10-megawatt project built by Sempra Generation that used First Solar’s panels.
The federal government has played a big role in promoting these giant solar projects. A loan guarantee program that drew a torrent of criticism for its $535 million loan guarantee to Solyndra for a solar panel factory also funded several solar power plants that have since been completed and producing electricity.
The program approved a $967 million loan guarantee for Agua Caliente. The way the program is structured, a loan guarantee typically translates into an actual loan from the U.S. Department of Treasury’s Federal Financing Bank. A loan guarantee is meant to provide assurance that if the borrower can’t pay back the loan, then the loan guarantee issuer will.
Other completed power projects that have gotten federal guarantees include the 392-megawatt Ivanpah Solar project (it uses mirrors and sun’s heat for energy production) that came online earlier this year and a 250-megawatt solar-panel project — both are in California and count NRG as an owner.
The federal program’s two other completed solar power plant projects are the 280-megawatt Solana in Arizona by Abengoa Solar and the 150-megawatt Mesquite Solar project in Arizona by Sempra Generation.
While these giant solar power plants have been a favored choice for utilities for meeting renewable energy mandates, they have become less popular. That’s because giant projects rely on so much land and create big impact on wildlife, water or other resources. They have become magnets for lawsuits from environmental and community groups, and that has prompted policy makers and some solar energy advocates to push for alternatives in creating a booming clean energy market.
California policy makers have been promoting smaller projects, around 20 megawatts each, that can be built closer to towns that will be served by the projects.