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.
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