Second Solar Deal for Sempra - Analyst Blog

Sempra Energy (SRE), through one of its subsidiary San Diego Gas & Electric (SDG&E), has signed a 20-year power purchase agreement (PPA) with LS Power to secure additional 45 megawatts (MW) of solar energy from the upcoming Centinela Solar Energy facility. The contract, valid till 2034, requires approval from the California Public Utilities Commission.
 
This 20-year agreement marks SDG&E’s second such deal on the Centinela project to be located 90 miles (145 kilometers) east of San Diego in California's Imperial Valley. The first deal for up to 130 MW of power from the same project was signed in May 2010.
 
The new deal, in addition to the first 20-year PPA agreement, will provide for a combined total of up to 175 MW of renewable energy, or electricity for more than 60,000 homes.
 
The Centinela Solar Energy facility is expected to come online in 2014 and will transmit solar power to SDG&E's service territory across Sunrise Powerlink, a 120-mile, 500-kilovolt electric transmission line, designed to increase power consistency in the region and tap the vast renewable resources of the Imperial Valley. The company also anticipates that the new power line, which is expected to be completed in 2012, will carry up to 1,000 MW of electricity.
 
Additionally, SDG&E signed a renewable contract last month in order to lock 7.5 MW of wind energy from Coram Energy LLC. Located in the Tehachapi Pass in Kern County, California, the Coram Energy facility began generating wind energy in June 2005.
 
We appreciate the company’s move toward the Centinela facility, an area with profuse desert sunlight, ideal for producing solar power. The project will help SDG&E to meet California 's authorization to procure 20% of its power from renewable resources by 2010 as well as its own objective of 33% by 2020.