The Santa Clarita Valley Water Agency tweaked conditions of its solar power-purchasing agreement Tuesday in a move that secures power for the agency, reduces cost and renders it more flexible, according to the agency.
On Tuesday, the agency’s board members held a special meeting to nail down the proper legal language required for changes made to its solar power agreement with SunPower Corp.
Because SunPower owns 100 percent interest in the solar operator — as Solar Star California XXIV LLC — and intends to transfer that interest to an affiliate of Goldman Sachs Renewable Power, agency directors had to make changes to the agency’s existing solar power agreement.
“The board action approved a few minor changes in the terms of the power purchase agreements,” Matt Stone, the agency’s general manager, said Thursday.
These items are:
· SCV Water agreed to waive any right of refusal that might otherwise be triggered by the Solar Star/Goldman Sachs deal.
· In return, SCV Water obtained a purchase option to include both systems. Originally, SCV Water had a purchase option for the larger of its two solar systems that could be exercised in 2020, but did not have a purchase option for the smaller system.
“The option gives us an opportunity to consider whether we want to buy it, or continue with the purchase agreements as is,” Stone said Thursday. “This determination would be made sometime before May 2020.”
The agency’s predecessor, the Castaic Lake Water Agency, entered into solar power-buying agreements with SunPower in 2011 and 2013.
SCV Water has two agreements in place that allow it to purchase power from two solar project installations near the Rio Vista Water Treatment Plant.
One solar field has a capacity of 1 megawatt and the other has a capacity of 3.5 megawatts. Combined, they produce between 10.5 to 11.4 million kilowatt hours of electricity each year.
Just as homes fitted with solar panels help reduce energy costs, so do the solar fields at the agency’s Rio Vista plant. The power supplied offsets some of the energy needs of the treatment plant and pumping facilities, Stone said.
At the moment, SCV Water has a purchase option for the larger of the two solar power systems that can be exercised in 2020 and SCV Water staff is evaluating whether such a purchase would result in a financial benefit to SCV Water.
SCV Water does not have an option to purchase the smaller of the two systems and it is likely that SCV Water would prefer to purchase both systems if it exercises its option.
Tweaking the agreement to accommodate implications of the transfer is expected to provide the water agency with greater flexibility as it looks at its energy options over the coming year.
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