PWCC's Arizona Utility To Infuse $500 Million In Solar Power

Published: 28-Oct-2009

Pinnacle West Capital Corporation (PWCC) said that its utility, Arizona Public Service Co. (APSC) has launched solar initiatives which include Solana solar plant to be built in the Arizona desert. The commitment is to invest $500 million to develop 100 MW of utility-owned solar generation and a pilot project to provide solar panels on customer homes with no up-front cost.

The commitment also includes a partnership with the National Park Service to power the Grand Canyon Visitors Center with solar panels.

APSC owns and operates 1.5 MW of small solar systems.

APS requires to generate about 1,500 MW of new renewable power by 2025 and "the majority will be solar," PWCC Chairman and Chief Executive Officer Don Brandt said.

"We see solar as virtually our only viable opportunity to supply the megawatt-hours," Brandt said. He added that state regulators have been supportive of APS's foray into solar power generation, although the company is awaiting their approval for its proposed $500 million solar program.

The company's solar initiative is driven largely by state regulations that require utilities to use renewable sources for 15% of the power they sell by 2025, with nearly a third of that coming from distributed generation, like rooftop solar, that is used close to where it's generated.

Recently, APSC secured $3.3 million in federal stimulus funds to carry a $14 million rooftop solar program in Flagstaff, Arizona, involving 300 homes.

Brandt said he wants to expand that program to allow more of the utility's 1.1 million customers to participate.

The Arizona utility installs and owns each rooftop solar system and signs a contract with the homeowner that locks in the customer's utility rate for 20 years. The rate is often about half of what the customer would ordinarily pay for electricity, according to Brandt.

"After our rebate and federal and state tax credits, (a solar system) still costs about $10,000 to $15,000...that's a lot of money," Brandt said. "We can finance it on our balance sheet a lot cheaper than a customer can on their credit card."

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