News Column

El Paso Electric Solar Grid Is One of Texas' Weakest

February 26, 2013

Vic Kolenc, El Paso Times, Texas

solar panels

El Paso Electric's solar power generation in Texas is extremely dim when compared with the city-owned electric utilities in San Antonio and Austin, which lead the state in solar energy installations, shows a new report from an Austin environmental group.

However, when El Paso Electric's New Mexico solar power is included, the El Paso utility is on the same level as the other Texas cities.

San Antonio and Austin's electric utilities account for 85 percent of the state's solar power installations, reported the Environment Texas Research and Policy Center in Austin in a report published this month.

The report was done to show how most utilities in the state are lagging far behind on solar power, and to drum up support

for proposed Texas legislation that would require increased solar use by Texas utilities and encourage more solar development by Texas cities, said Luke Metzger, director of the environmental group.

The fact that El Paso Electric gets most of its solar energy from New Mexico solar projects shows the power of state mandates, Metzger said.

El Paso Electric's been forced by New Mexico mandates to use more solar power and other renewable energy sources in that state while Texas has minimal requirements for utilities to use solar, wind, or other renewable energy sources, Metzger said.

The Texas Legislature and the Texas Public Utility Commission need to mandate more use of solar power because that will improve the environment

and will allow Texas to cash in on its abundant sunshine, especially in West Texas, he said.

Texas tops the nation in wind energy with 9 percent of the state's electricity generated from wind generators, Metzger said. But the state ranks 13th in the nation in the amount of electricity generated by solar, he reported.

Rocky Miracle, vice president of corporate planning and development for El Paso Electric, said the utility would like to put more solar projects in El Paso, but, he said, building solar projects is more economical in New Mexico because of that state's incentives and mandates. The company has contracts to buy solar power from several New Mexico solar projects built by solar developers.

The largest solar project supplying El Paso Electric so far is in Santa Teresa, near El Paso's West Side. NRG Energy's solar plant has 340,000 photovoltaic solar panels that can produce up to 20 megawatts of electricity -- enough power to supply 6,600 homes in El Paso Electric's two-state system.

San Antonio's CPS Energy has Texas solar installations totalling 52.6 megawatts, or 73 watts per customer; Austin Energy has 41.3 megawatts of solar, or 99 watts per customer; Oncor, which serves the Dallas area, has only 9.9 megawatts of solar, or 3 watts per Texas customer; and El Paso Electric has only 1.5 megawatts of Texas solar installations, or 5 watts per Texas customer, Environment Texas' report shows.

Even though El Paso Electric's solar installations in Texas are minimal, its 5 watts of solar power per Texas customer ranks third in the state, albeit a very distant third.

However, if you add up the four major solar projects in New Mexico providing power to El Paso Electric, the utility has 48.5 megawatts of solar power, second to San Antonio. That solar power is used by customers in both New Mexico and in El Paso.

Currently 2.5 percent of El Paso Electric's power comes from the New Mexico solar projects, Miracle said, and that's expected to grow to around 5.5 percent when the 50-megawatt Macho Springs Solar Project near Deming is completed late this year or by the middle of next year. That's one of the largest percentages of solar power in the nation for an investor-owned utility, Miracle said.

El Paso Electric has signed a 20-year agreement to buy power from the Macho Springs plant being built by First Solar, a Phoenix area manufacturer of photovoltaic solar panels. That project is billed as New Mexico's largest solar project.

El Paso Electric is working to get more solar projects developed in El Paso, but as an investor-owned utility, it has regulatory constraints that city-operated utilities, such as those in San Antonio and Austin, don't have, Miracle said.

The Texas Public Utility Commission last year shot down an El Paso Electric proposal to build an $8.5 million, 2.5-megawatt solar system at its Newman natural gas-fueled power plant in Northeast El Paso because the state regulators determined the project too expensive for the company's ratepayers, Miracle said.

"We knew it was not economical," but it was designed as a test project to see how solar affects our electrical system, Miracle said.

El Paso Electric only has about 1.5 megawatts of solar installations inside El Paso -- at an electrical substation, on top of its Downtown headquarters, at El Paso Community College, and on some homes and businesses which received incentives from a City Hall/El Paso Electric program.

Miracle said he'd like to see Texas increase incentives and increase requirements for solar projects in the state. He doesn't foresee the company lobbying against increased requirements that are reasonable, he said. However, increased use of solar would likely increase energy costs in Texas, and that would likely require higher rates, he said.

Environment Texas' Metzger said solar is more expensive now. But solar and wind prices are dropping significantly and are expected to continue to decrease, making it competitive with natural gas and coal in the future, he said.

"San Antonio and Austin have aggressive (solar) programs, but they have some of the lowest (electric) rates in the state," Metzger noted. That's also because those utilities have diverse energy portfolios with several different energy sources, he added.

The Macho Springs Solar Project near Deming received lots of attention recently when El Paso Electric regulatory filings in New Mexico revealed the utility will buy power from it for 5.79 cents per kilowatt-hour. It costs El Paso Electric about 10 cents per kilowatt-hour for natural-gas generated power, Miracle said.

"It's the cheapest solar I've ever seen," but it's likely an anomaly and doesn't mean all future solar energy will come in that cheap, Miracle said. Some federal tax benefits for solar projects expire at the end of the year and some solar developers are scrambling to get projects under way before the end of the year, which, at least for the Deming area plant, helped El Paso get a good energy price, he said.

Wind, solar and natural gas will be the main sources of future electric generation, Miracle predicted. However, what is needed is an economical way to store solar and wind energy, he said.

"The holy grail is storage," he said.

Meanwhile, environmentalists like Metzger hope the Texas Legislature can pass at least some of the solar-friendly bills in its current session. Two bills filed by state Rep. Rafael Anchia, D-Dallas, and Rep. Eddie Rodriguez, D-Austin in the Texas house call for dramatically increasing the amount of solar and other renewable energy generation required in Texas. Both may be too ambitious to have much chance to pass, Metzger said.

Sen. Jose Rodriguez, D-El Paso, has filed a bill requiring homebuilders to offer solar energy as a standard option on homes.



Source: (c)2013 the El Paso Times (El Paso, Texas) Distributed by MCT Information Services


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