Southern Power units seek market authority for 200 MW of California solar projects

Two affiliated companies with neighboring solar projects in California, RE Garland LLC and RE Garland A LLC, applied separately on Jan. 8 to the Federal Energy Regulatory Commission for approval of their market-based rate authority.

Both companies asked for expedited consideration of their application in order to secure financing for the construction of each project and to meet the construction milestones set forth in their interconnection agreements. They asked for approvals on or before Feb. 12.

RE Garland is developing and constructing a 180-MW (nameplate) solar photovoltaic facility located in Kern County, California. The Garland Facility will be interconnected to the transmission system owned by Southern California Edison (SCE) within the California Independent System Operator balancing authority area. The Garland Facility will interconnect with the SCE’s Whirlwind 220-kV Substation at the 220-kV bus via a generation tie-line and related interconnection facilities.

The Astoria Shared Facilities will be owned and shared among RE Astoria LLC, Astoria 2 LLC, RE Garland, RE Garland A and RE Garland 2 LLC under a shared facilities agreement. In addition, RE Garland and RE Garland A will share in the rights and responsibilities of a Large Generator Interconnection Agreement with SCE and CAISO.

RE Garland A is an affiliate of RE Garland, while Astoria, Astoria 2 and Garland 2 are not affiliates. Astoria, Astoria 2 and Garland 2 are indirect, wholly-owned subsidiaries of Recurrent Energy LLC.

The RE Garland project is scheduled to achieve initial synchronization in February 2016 and commercial operation in October 2016. RE Garland is an exempt wholesale generator (EWG) under the Public Utility Holding Company Act of 2005. All of the output from the RE Garland Facility is fully committed and will be sold initially to SCE from the commercial operation date through a 15-year power purchase agreement.

RE Garland is wholly owned by RE Garland Holdings LLC (Garland Holdings) which is wholly owned by RE Silverlake Holdings LLC (Silverlake Holdings). Southern Renewable Partnerships LLC (SRP) owns 100% of the Class A membership interests (which convey full operating and managing interests) of Silverlake Holdings, which account for 51% of total ownership interests. The remaining ownership interests are held as Class B membership interests. Class B membership interests in Silverlake Holdings are passive and noncontrolling, conveying only limited consent rights. Control over the day-to-day operations of the Garland Facility will reside with SRP, as the indirect upstream owner of 100% of the Class A, voting, controlling and operating interests in Silverlake Holdings.

SRP is a wholly-owned subsidiary of Southern Power Co., which itself is a wholly-owned subsidiary of Atlanta-based Southern Co. (NYSE: SO).

The RE Garland filing noted that SRP holds 100% of the controlling operating interests in Tranquillity Holdings LLC, the owner of RE Tranquillity LLC, which is constructing a 200-MW solar photovoltaic facility in Fresno County, California. All of the output of the RE Tranquillity facility will initially be sold to Shell Energy North America (US) LP beginning at the commercial operation date, through Nov. 30, 2019. Following that period, the output will be sold to SCE under a 15-year power purchase agreement.

For its part, RE Garland A in its Jan. 8 application gave largely the same background information. RE Garland A is developing and constructing a 20-MW (nameplate) solar photovoltaic facility located in Kern County, California. The Garland A Facility will be interconnected to the transmission system owned by SCE within the California Independent System Operator Corporation balancing authority area through the shared interconnection facilities mentioned above.

The RE Garland A project is scheduled to achieve initial synchronization in February 2016 and commercial operation in October 2016. RE Garland A is an EWG. All of the output from the Garland A Facility is fully committed and will be sold initially to SCE from the commercial operation date through a 20-year power purchase agreement. This project company is controlled by Southern Power under a similar structure to that of RE Garland.

Southern Power had announced on Dec. 18, 2015, the acquisition of a controlling interest in the 200-MW (ac) Garland solar facility from Recurrent Energy, a subsidiary of Canadian Solar. Recurrent Energy is constructing the facility and will retain the remaining interest in the project.

Construction of the Garland facility began in December, with Signal Energy Constructors managing the engineering, procurement and construction of the facility. The project is being built on two sites totaling about 2,000 acres in Kern County, and is expected to create more than 300 construction jobs. The Garland solar facility is Southern Power’s fourth solar project in Kern County.

The facility will consist of more than 800,000 polycrystalline photovoltaic solar modules, mounted on single-axis tracking tables, and is expected to enter commercial operation in the fourth quarter of 2016. The electricity and associated renewable energy credits (RECs) generated by the facility will be sold under two long-term power purchase agreements with SCE, which will have the option to keep or sell the RECs, said the Dec. 18 announcement.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.