Toprak LLC and Duke Energy Carolinas applied Dec. 15 at the North Carolina Utilities Commission to transfer a certificate for a 20-MW (ac) solar project to Duke, and to cut the size of the project down to 15.4 MW (ac).
Toprak plans to transfer the Certificate of Public Convenience and Necessity (CPCN) approved by the commission on Feb. 3 of this year, and the associated rights and assets, of its Davie County, North Carolina, solar project to DEC. Duke sees this project as a cost-effective resource for compliance with North Carolina’s Renewable Energy and Energy Efficiency Portfolio Standard (REPS).
“The addition of the Facility to DEC’s REPS compliance resource portfolio is in the public interest as it will bring material quantities of solar [renewable energy credits] for long-term compliance and work in combination with the Company’s other REC procurement efforts to provide a low-cost, balanced REPS compliance solution over time,” said the application. “This project will also help to ensure that DEC’s customers receive the benefits, through the lower cost of REPS compliance, of the Federal Investment Tax Credit (‘Federal ITC’) which is set to reduce on December 31, 2016.”
Toprak was established in 2012. Birdseye Renewable Energy is the parent company of Toprak, and has a principal place of business in Charlotte, North Carolina.
“Given the beneficial economics if the project is placed in-service prior to December 31, 2016, DEC would appreciate the Commission’s prompt consideration of this request,” the application said.
At the time of the commission’s issuance of the CPCN, Toprak’s intention was to enter into power purchase agreement (PPA) with DEC for sale of the output from the facility as a Qualifying Facility under the Public Utilities Regulatory Policies Act. In November 2014, Toprak filed its self-certification as a Qualifying Facility with the Federal Energy Regulatory Commission.
DEC and another Duke Energy (NYSE: DUK) subsidiary, Duke Energy Progress, issued a request for proposals for 300 MWs of solar photovoltaic facilities in February 2014 to continue to advance Duke Energy’s goal of encouraging new solar opportunities for development to help it most cost-effectively comply with North Carolina’s REPS and to further diversify its respective energy resource mixes.
Since the application for the CPCN was filed in November 2014, after the issuance of the solar RFP, Toprak was unable to participate in the RFP and intended to enter into a renewable PPA with DEC for the purchase and sale of power and RECs from the facility. Toprak has completed most major permitting activities and is progressing toward an interconnection agreement.
Based on expected engineering, procurement, and construction (EPC) schedule, the facility is capable of being placed in-service before the end of 2016. It was initially scheduled to have a nameplate capacity of 20-MW (ac) but now will have a nameplate capacity of 15.4-MW (ac) due to constructability constraints on the site layout. The facility will utilize polycrystalline solar PV modules affixed to ground mounted racks supported by driven piles (or other suitable racking as site soil conditions may require), industry standard inverters and additional equipment to support the facility (transformers, circuit breakers, combiners, surge arrestors, conductors, junction boxes, disconnect switch, connection cabling, and SCADA plant controllers).
The application noted that DEC issued the Green Source Rider RFP in February 2015. The RFP solicited 50 MW (ac) for both PPAs and solar asset purchase proposals for facilities that would be in-service by Dec. 31, 2016. DEC received a limited response to the RFP with only ten proposals being proposed. Only two of the sites proposed were utility-scale projects greater than 5 MW (ac) in size. Of the two, one had a problem with siting, and the other (45 MW ac) was awarded a PPA that is currently under negotiation. DEC was unable to reach agreement with participating counterparties on the other asset purchase proposals (asset purchases comprised nine of the ten proposals) due to quality of the projects and pricing. Six of the projects evaluated for ownership had “fatal flaws” that DEC identified through due diligence. Negotiations to purchase two of the projects were terminated after the developer accepted a bid from another investor who bought the project assets, including the QF PPA.
Crowder Construction will design and construct all Toprak plant facilities up to the facility substation fence-line, which includes the procurement of such items as racking, cabling, and fencing. DEC will procure the major equipment (panels, inverters, and SCADA) through its own procurement process. This will help DEC’s efforts to standardize equipment, optimize system performance, support long-term maintenance and spare parts strategies, and minimize overall project costs. Crowder Construction is a North Carolina-based EPC firm and is currently constructing the Camp Lejeune Solar Facility for DEP.