California Array Is Navy’s New Top Solar Gun

The Navy has a new 13.78 megawatt solar power plant in the high desert of California — the service’s biggest solar project yet — and it didn’t even have to pay for it.

Like tens of thousands of California homeowners, the Navy went the power purchase agreement route in bringing solar to the Naval Air Weapons Station China Lake, 120 miles north-northeast of Los Angeles. The system, which was dedicated last week, is the first federal agency project to be financed through a 20-year term solar PPA, according to developer SunPower.

SunPower Solar Tracker (image via SunPower)

Being able to do a 20-year PPA instead of one lasting 10 years can apparently make a big difference, allowing the Navy to buy the solar power produced on its land at “up to 30 percent below the rate available through shorter duration” arrangements. The array is expected to meet 30 percent of China Lake’s annual energy load, reducing the Navy’s energy costs — that’s your cost, Mr. and Ms. Taxpayer — by a projected $13 million over the full 20-year span. (Of course, some of that savings will likely be lost to the government as the system developers take advantage of incentives for solar.)

“This 20-year PPA will significantly lower long-term electricity costs at China Lake, and can be used as a template for additional large-scale federal solar projects,” SunPower executive Howard Wenger said in a statement.

The Army is embracing similarly long power purchase agreements. This past summer, it put out a “Multiple-Award Task Order Request for Proposal,” dangling up to $7 billion to purchase 2.1 million megawatt-hours of power sourced from solar and other alternative-energy technologies.

Meanwhile, back in January, the U.S. Defense Department’s Office of Installations and Environment concluded that some 25,000 acres on military land were “suitable” for solar development, and all told the study said 7,000 megawatts of solar energy capacity was technically and economically feasible. China Lake was pegged for 6,777 acres of possible development. That report was followed in August by an agreement between the Interior and Defense departments to work together to target “significant proven or potential solar, wind, geothermal and biomass resources on or in the vicinity of DOD installations throughout the West.”

The China Lake system now up and running uses SunPower’s Oasis Power Plant product, which integrates the SunPower T0 Tracker with SunPower’s high-efficiency panels. In a Sept. 30, 2011, announcement of new military contracts, the Department of Defense put the 20-year cost to the Navy at slightly more than $100 million. An affiliate of Metropolitan Life, the insurance company, actually owns the power plant, although SunPower will operate and maintain it.

Sports columnist, newspaper desk guy, website managing editor, wine-industry PR specialist, freelance writer—Pete Danko’s career in media has covered a lot of terrain. The constant along the way has been a fierce dedication to knowing the story and getting it right. Danko's work has appeared in Wired, The New York Times, San Francisco Chronicle and elsewhere.

  • http://www.facebook.com/people/William-Branham/1307690940 William Branham

    Go NAVY!

    • Cl1ffClav3n

      Beat GSA in fraud, waste, and abuse of taxpayer money and property!

  • MKL

    Who gets the RECs? Typically of course it would be SunPower, but I know that the armed forces have renewable energy goals that I would think they need the RECs to meet.

    • Pete Danko

      Honestly, MKL, I’m not sure. I’d need to do some reporting to find out. My assumption is that the Met Life unit that owns the project got ‘em. Don’t know for sure, however. Also don’t know what value they might have at this time or in the future — I haven’t followed the slow-to-develop California REC market closely, but I don’t think it’s very active. The investor-owned utilities who can use them to meet RPS standards don’t appear to be buying them, at least at this time, I think, and I don’t know what sort of (if any) voluntary market has developed. Again, I’d need to do some digging to figure out the details there. As for the military, my understanding is that the services can either purchase renewable energy or renewable energy credits to meet their targets, which could, admittedly, result in the renewable energy produced being used by the services to meet their targets and California’s IOUs to meet their RPS targets.

  • Cl1ffClav3n

    Hey everybody, you give me $100M today and I will give you $13M back over the next 20 years, deal? That is exactly the deal our federal government just made with SunPower (DBA Solar Star CA) in China Lake. $100,268,000.00 was just spent by the US Navy for the base year of a 20-year PPA which will save it only a total of $13M over the next 20 years. That is a horrible negative return on investment. It is even worse than the deal the Air Force got from SunPower at Nellis in 2007 where they paid the same $100M for the same 14MW solar plant but are saving $1.2M per year for 20 years ($24M). Our nation cannot survive much more of this epic cheating of the taxpayers. People should be outraged that their tax money is being wasted like this and that power company customers in CA and NV are also being taxed with perpetually higher rates to line the pockets of SunPower, and the Chinese who make the SunTech panels they install.

    • Pete Danko

      I think you misunderstand the nature of the contract. The Navy paid no upfront costs here. A firm fixed-price contract simply is distinguished from a cost-plus fixed-fee contract. It is advantageous to the government, as it sets a firm price regardless of the costs that the contractor might incur in performing the contract over its life (whereas a cost-plus fixed-fee passes along additional costs). If the contractor does not perform — does not deliver the power — the Navy does not pay. There is no risk there. It will pay for the electricity, at a rate less than it would otherwise pay, over the course of the contract. Yes, the subsidies that in part make this lower cost possible will be borne by the taxpayers and ratepayers (as noted in the story). As for SunPower panels being made by Suntech, I don’t believe it’s true. I’ve certainly never heard of it. SunPower employs more than 4,000 people making solar panels in the Philippines, and also has some manufacturing in the United States (as does, BTW, Suntech, with more than 100 employees at a plant in Goodyear, Arizona).

      • Cl1ffClav3n

        @Pete, I think you are right about the solar panels in this project. They are supposed to be SunPower E20 panels–I hope they are. For the Nellis Air Force Base project in 2007 SunPower installed 72,416 200-watt SunTech STP200 panels. As to the PPA contract terms, It looks to me like the whole $100M is funded from current FY money, though the money doesn’t expire at the end of the year. So if all $100M of the money is coming out of a current year ops & maintenance budget, how is it fair to say the Navy is not paying up front, regardless of how the money is doled out.

        • Pete Danko

          BusinessWeek reported in 2009 that one-third of the panels installed at Nellis were made by SunPower. SunPower, Sanyo and Evergreen also supplied panels. Rather odd project in the early days of utility-scale PV development. You rarely if ever see such arrangements these days. Anyway, I wouldn’t mind if the military had a buy-American policy on these projects, but of course that could amount to — in effect — further subsidies, and some might object to that.

          • Pete Danko

            *one-third of the panels at Nellis were made by SUNTECH*

          • Cl1ffClav3n

            SunPower and Suntech had a now defunct JV called Gemini Solar. Both Suntech and Gemini claimed that a majority of the panels at Nellis were Suntech’s, as did a contemporary MIT article. Whatever the exact truth, it’s certainly complicated. I think the Air Force is ultimately going to regret the whole thing. The company that won the original contract was Power Light. The company that built the system was SunPower. The company that was formed to own & operate was a subsidiary of MMA called MMA Renewable Ventures. They were bought out by Fotowatio from Spain in 2009 who is now owner/operating running the plant through a subsidiary called Solar Star NAFB. Another Fotowatia subsidiary, Solar Star of California, is running new Navy’s new solar plant at China Lake as well. So, in a supposed bid to improve critical US military energy security and stimulate the US economy, we bought a ton of Chinese solar panels and have entrusted them to Spain. I guess the silver lining is that neither the China Lake plant nor the Nellis plant can provide any power when city power goes down because they didn’t install transfer switches. So all the millions never bought any real energy security in the first place.

          • Pete Danko

            Fotowatio Renewable Ventures is owned by MEMC Electronic Materials, based in St. Peters, Missouri.

          • Pete Danko

            The relevant U.S. unit, I should have specified.

          • Cl1ffClav3n

            Thanks, Pete, I missed the latest buyout iteration in August. So now the Nellis solar farm belongs to a US subsidiary (Solar Star NAFB) of a Delaware incorporated multinational holding company (MEMC) with numerous US and foreign subsidiaries, hoping to make money by expanding into solar construction and O&M to make up for losses in what used to be its primary business of semiconductor materials. Presumably they would pay taxes in the US if they make a profit.

          • Pete Danko

            That sounds right to me!