San Antonio to get 400-MW Solar Project

In a unique, first-of-its kind generation-to-manufacturing proposal, CPS Energy is entering into negotiations for a power purchase agreement from one of the nation’s largest solar projects. The project will mean new corporate headquarters and U.S. manufacturing operations for global companies in San Antonio. The offer from OCI Solar Power is expected to result in 400-MW of zero-emissions solar energy, 800-plus professional and technical jobs, and more than $1 billion in construction investment.

San Antonio Mayor Julián Castro, CPS Energy Board Chair Derrick Howard, the utility’s President and CEO Doyle Beneby, and executives with the future partners detailed the major local economic development initiative today.

 The OCI Solar Power proposal outlines a partnership that should result in:

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  • Multiple solar manufacturing facilities in the San Antonio area to produce proven components of solar power plants
  • More than $100 million in capital investment
  • 800+ jobs with an annual payroll of nearly $40 million
  • a 25-year purchased power agreement for up to 400 MW of solar generation

“This proposal would diversify our energy sources in a manner that makes good business sense and meets our objectives. Our goal is to always provide our ratepayers safe, reliable and affordable energy, and wherever possible, bring additional value to our community,” said Beneby. “As San Antonio becomes a central hub for solar development in the U.S., there is also a beneficial opportunity for other Texas based municipal utilities to achieve their renewable energy goals by becoming sites for parts of the project.”

 Mayor Castro highlighted its connection to the citywide, aspirational goals of SA2020. He also noted the growing number of clean energy companies CPS Energy is attracting to San Antonio by leveraging its unique role in the city’s economic development. Estimates place the projected annual economic impact at $700 million.

 “This accelerates San Antonio’s leadership in the New Energy Economy, and provides the kind of good-paying, brainpower jobs that are becoming the staple of our local job-creation efforts,” Mayor Castro said.

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With more than $1 billion in construction investment, estimates place the economic development benefit from Texas construction at $177 million. OCI Solar Power proposes to use local firms for some aspects of the engineering procurement and construction (EPC) and committed to a good-faith effort to work with local companies in developing the project’s manufacturing components and/or processes.

 “OCI Solar Power is excited to relocate our headquarters to San Antonio and to work with CPS Energy to create jobs and spur economic development and growth in Texas,” said OCI Solar Power Board Chair Kirk Milling. “Our experienced team will build leading-edge solar power plants with proven, high-performance technologies to make San Antonio a national hub for solar development and pave the way to expand solar energy across Texas and beyond.”

In response to CPS Energy’s request for proposals, OCI Solar Power invited manufacturers from across the industry to be part of its consortium. The anchor manufacturer in the consortium is Nexolon—a global leader in manufacturing components used in solar panels. As part of its commitment to the consortium, Nexolon would build a manufacturing facility and locate its North American headquarters in San Antonio.

The future addition of OCI Solar Power and Nexolon would bring the number of clean energy companies CPS Energy has attracted to San Antonio to seven. The utility revealed its plans to become a New Energy Economy hub in June 2011. CPS Energy’s approach for a new energy economy leverages low and no-carbon emitting energy resources to stimulate local economic and educational development.

 As outlined by OCI Solar Power, the solar project would become operational in phases over the next five years. No date is set yet for the project to get underway but all parties plan to move expeditiously to negotiate the terms and finalize an agreement.

“In just a few short years, this initiative could help CPS Energy achieve our Vision 2020 goal of attaining 20 percent or 1,500 MW of renewable resources by the end of the decade. It’s a phenomenal opportunity that propels this utility to a leadership position for both wind and solar energy,” stated Howard.

 In 2009, CPS Energy launched its first solar endeavor with the 14-MW Blue Wing solar farm owned by Duke Energy. An additional 30 MW are under contract with Sun Edison. The utility is also a leader in wind energy with 1059 MW under contract. CPS Energy maintains the lowest rates in the nation among the top 10 largest cities through a diversified energy portfolio that also includes nuclear power, gas and clean coal.

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