A leading US utility has this week signed a new deal to secure solar power for up to 21,000 homes at a price that is less than half the level it previously paid.
Tucson Electric Power (TEP) announced it had secured an “historically low price” of less than three cents per kWh for the power from a new 100MW solar array in southern Arizona, as part of a 20-year contract.
The project will give the company enough clean power to meet the annual electricity needs of nearly one out of every three Tucson-supplied homes.
The array, which is due to come online by the end of 2019, will also be integrated with a 30MW energy storage system that promises to provide reliable clean power supplies for the company.
“This new local system combines cost-effective energy production with cutting-edge energy storage, helping us provide sustainable, reliable and affordable service to all of our customers for decades to come,” said Carmine Tilghman, senior director of energy supply and renewable energy for TEP, in a statement.
The company said that with the cost of solar farms having fallen by nearly 75 per cent over the past five years it made sense to focus on such projects, especially given the cost of managing excess power from rooftop solar arrays is increasing across the region.
“Focusing our resources on the development of cost-effective community scale systems allows us to provide more solar energy to more customers for less money,” Tilghman said. “The best way to help solar grow in our community is by planning and siting systems in an organised, responsible and equitable manner.”
The new project will be built, operated and owned by an affiliate of leading renewable energy developer NextEra Energy Resources.
“In addition to clean, low-cost energy, this project will create good-paying jobs and increased tax revenue for the state and local community,” said Mike O’Sullivan, senior vice president of development at NextEra Energy Resources.
TEP said the solar project and recent deal with NextEra to develop a new 100MW wind farm would both make a contribution to its target of delivering at least 30 per cent of its power from renewable sources by 2030. The company said it has also added three battery energy storage projects to the grid so far this year and plans to continue investing in the fast-emerging technology.