LADWP Takes Another Big Step to Create L.A.’s Clean Energy Future
Finalizes 150 MW Local Solar Program Plus 200 MW Utility Scale Solar
|LOS ANGELES — The Los Angeles Department of Water and Power (LADWP) took another significant step toward creating L.A.’s clean energy future while boosting the local economy by finalizing the full 150 megawatt (MW) Feed-in Tariff (FiT) Program—the largest in any U.S. city.
On April 16, the Board of Water and Power Commissioners approved a program for the additional 50 MW of local solar (FiT50) to complement the first 100 MW FiT program approved in January. At the same time, the Board paved the way for a 200 MW utility scale solar array in the Mojave Desert.
The 150 MW of FiT solar, combined with a new 200 MW utility scale solar project, is an important part of LADWP’s transition away from coal power. LADWP recently announced it will stop receiving power from two coal-fired power plants by 2025, and replace it with increased renewable energy and energy efficiency, as well as efficient natural gas-fired units.
Unlike the set-pricing FiT program approved for the first 100 MW of local rooftop solar, the FiT50 will be competitively priced through an RFP that is “bundled” with a utility scale solar project. It also requires the local projects to be built within LADWP’s service territory in the Los Angeles basin.
Aram Benyamin, LADWP Senior Assistant General Manager-Power, said the combined RFP is a means of developing the most solar at the most competitive price. “One of the biggest benefits is that competitive bids and greater economies of scale will result in lower costs to customers and minimize rate impacts,” Benyamin said. “Our goal is to accomplish the power supply transformation while keeping the cost impacts on customers as low as possible.”
The combined RFP approach will also trigger the development of a higher volume of solar power within a few short years, increasing LADWP’s level of renewable energy at a faster pace to meet the goals of 25% renewables by 2016 and 33% renewables by 2020.
The RFP will seek proposals for building 200 MW of solar photovoltaic power on the Beacon Property owned by LADWP. Located in the Mojave Desert about 15 miles north of the town of Mojave, the land is ideally situated adjacent to LADWP’s Pine Tree Wind and recently completed 10 MW Solar Power Plants, the Barren Ridge Switching Station, existing transmission lines and other electric infrastructure.
For the RFP, the Beacon property is divided into four sites for solar projects averaging about 50 MW. Bidders may submit proposals for one or more of the four sites, each of which is linked to a required smaller local solar project between 10 and 14 MW in size. The RFP also sets a price cap for each solar project—-$140 per megawatt-hour (MWh) for the local FiT solar, and $85 per MWh for the Beacon project.
Late last year, LADWP purchased the 250 MW Beacon Solar Project from Nextera Energy Resources, LLC. The purchase came with previously approved permits to develop the site as a solar facility, plus environmental studies, and preliminary engineering designs. LADWP crews will build a 50 MW solar array on the property and the remaining 200 MW will be offered to private developers through the RFP, expected to be issued in May.
In February, LADWP opened up the first 20 MW allocation of the 100 MW FiT Program. Proposals were received for about 45 MW worth of Los Angeles solar projects ranging in size from 30 kilowatts (kW) to 3 MW. LADWP is conducting interconnection studies for the first 20 MW of proposals submitted. Once the studies are completed, the bidders can decide whether or not to complete the contract, which will be a standard 20-year contract at a set price. Under the program guidelines, LADWP will pay 17 cents per kWh for the first 20 MW of local solar. Subsequent 20 MW allocations will be made available every six months through 2016 until the full 100 MW is subscribed. The set price will decline after each 20 MW is reserved.
LADWP has been steadily building a diverse renewable energy portfolio of wind, solar and geothermal power. Last fall, LADWP entered into two long-term agreements for 460 MW of solar power from two projects being developed in Nevada. LADWP recently entered a power purchase agreement for 14 MW of geothermal energy from the Wild Rose that will be developed by Ormat LLC in Nevada.