picture-35Days after California Governor Arnold Schwarzenegger vetoed legislation that would have put limits on renewable power from outside the state, major utility Pacific Gas & Electric has signed an agreement to buy 290 megawatts of power from a solar station in Arizona.

The Agua Caliente power plant is to be built and operated by San Francisco-based Nextlight Renewable Power. The vetoed legislation would have required Californians to derive one-third of their power from in-state renewable resources by 2020. Some out-of-state power would have also been allowed, as long as it could be transmitted to customers within a day of being generated. This would have adversely affected the Agua Caliente development, which is expected to power 100,000 homes in central and northern California.

The proposed bills were designed to create more permanent jobs associated with power projects in California and to reduce the construction of additional transmission lines, which are expensive and disruptive to the environment along the way. But the real advantage of allowing renewable power to be brought in from outside the state is the regulatory ease: the Agua Caliente power station already has all its major permits and is expected to be fully operational by 2014 (with some power available by 2012). The same plant built in California would probably not have been able to obtain the requisite permits as quickly.

Agua Caliente itself may generate up to 700 gigawatt-hours of energy a year, far more than will be bought by PG&E — so it is no doubt shopping around for other utility distribution deals. It will occupy 2,400 acres of a 3,800 acre ranch, which will also return some irrigation water back to the Colorado River.

PG&E is on a roll, having signed several power purchasing agreements recently, totaling 830 megawatts of solar power. This is its second contract with NextLight.

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