Pacific Gas & Electric wants to boost its solar output by adding 500 megawatts of photovoltaic power in California.
The utility wants to invest at least half of that in solar panels placed on commercial rooftops and on ground-mounted modules that PG&E would own and operate. The other half is earmarked for long-term contracts with private-sector solar companies, who would sell the power to PG&E.
About 100 megawatts of photovoltaic power would be added annually under the deal, with completion slated for 2015.
Although utilities have traditionally owned large fleets of power stations, renewable generation has often been developed by independent power producers who then sell the electricity to the utilities. And during the ill-fated experiment with electric deregulation, utilities were pressured to sell off generating assets.
But the credit crisis may be rewriting the script for who builds power plants these days. As the credit crisis deepened last fall, renewable power developers found it hard to get funding from banks. But PG&E, as a regulated utility, has a steady stream of income from the 5.1 million electric customers who use the utility’s power, enabling the utility to pour about $1.4 billion into developing and owning its own fleet of small, photovoltaic power plants.
“Given our size and credit rating and strength, we can move forward where others might not be able to do so,” CEO Peter Darbee told the San Francisco Chronicle.
The solar installations will range in size from 1 megawatt to 20, and many could be built on PG&E property near substations, providing access to the utility’s existing system of transmission and distribution lines.
State mandates require California utilities to boost their use of electricity from clean sources to 20% by 2010 for PG&E, Edison and San Diego Gas & Electric. Urban projects involving solar panels offer a quick way to boost their totals because construction can be completed in just months.