U.S. group NRG Solar has acquired a 25.65 MW solar project on the island of Guam from Quantum Guam Power Holdings, a subsidiary of Houston-based Quantum Utility Generation (QUG).
QUG developed the project in cooperation with the Guam Power Authority (GPA), the islands sole electric utility, as the U.S. territorys first utility-scale renewable energy plant.
"We are pleased to bring the development phase to a successful close and facilitate the transfer of the project to a highly-capable renewable energy company like NRG Solar to continue with construction and operations," said Sean O’Donnell, QUG’s chief financial officer.
Guam, a U.S. territory subject to U.S. law and environmental regulations, currently relies on imported residual fuel oil and diesel to generate 100% of its power requirements.
NRG Solar, the Carlsbad, California-based subsidiary of U.S. energy giant NRG Energy, will construct, own and operate the project, which it said would help mitigate Guams exposure to fuel price volatility and future environmental regulations. The company will sell all of its power output to GPA under two 25-year power purchase agreements (PPA).
According to GPA estimates, the project will generate enough clean solar power during the PPA period to offset consumption of almost 2 million barrels of residual fuel oil and diesel, representing total fuel cost savings to GPA of more than $300 million and net savings of approximately $100 million.
"NRG Solar has been focused on reducing the levelized cost of solar energy in both the utility and distributed solar markets," said Tom Doyle, NRG Solar president and CEO, adding that the company has sought to drive down the balance of system costs through in-house engineering, procurement and construction as well as through creative financing strategies on well-developed projects.
"The result of this effort provides us with opportunities like the Guam project, which was successfully-developed by QUG and is now ready for NRG Solar to assume long-term ownership of the project, Doyle said. We are proud to partner with GPA in paving the road for the development of this and other renewable energy capacity on Guam."