The Roserock Solar project is already historic for Texas, as the first large-scale solar project announced with a power contract under five U.S. cents per kilowatt-hour. Today the project’s owners announced substantial progress, with financing obtained and ground broken, on schedule to complete the project by the end of 2016 before the drop-down of the federal Investment Tax Credit.
As a key component to all of this, Georgia’s Southern Company has acquired a 51% stake in the 157 MW-AC, 212 MW-DC project from developer Recurrent Energy and parent company Canadian Solar, which retain 49% ownership.
The acquisition of this equity stake may have been the final piece for the others to fall into place, including financing. A syndicate of five banks will supply the project with roughly $275 million in project-level construction debt, an LC facility and a back-leveraged term facility.
Recurrent Energy notes that while construction of a substation for the project began in September, securing financing was the signal to begin major works. We close financing on a project and then move forward, Recurrent Energy Spokesperson Cate Powers told pv magazine. For Recurrent, that’s a pretty common cadence.
McCarthy Building Companies will serve as engineering, procurement and construction contractor for the plant, which will see over 700,000 Canadian Solar CS6X-P PV modules installed over 5.7 square kilometers.
Recurrent signed a power purchase agreement (PPA) for the project with Austin Energy in March 2014. While San Antonio, Texas’ municipal utility had already announced power contracts for 400 MW of projects with Korean developer OCI, the Austin/Recurrent deal was the first PPA for a single-site project over 100 MW in the state.
That was the first big solar contract in Texas, explains Powers. People were pretty hungry for it and Recurrent was as well.
Since that time Austin Energy has gone on to sign another 450 MW of solar PPAs, at similarly low prices. This means that between the contracts held by CPS and Austin Energy, over 1 GW of utility-scale solar PV is expected to be built in Texas by the end of 2016.
Like many of these projects, Roserock Solar is being built in sun-drenched West Texas. The project is located in Pecos County, over 300 miles West of Austin and atop one of the largest oil fields in the United States. The county is also a prime location for wind development.
And this may be only the beginning. With excellent solar resource, high peak power prices on Texas’ isolated grid, water issues with conventional generation and a need for daytime power to meet peak demand, Texas’ grid operator is forecasting that the state will add 13 GW of solar PV by 2030, even without factoring in the impact of pending federal regulations.