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Austin Energy signs 18-year contract for 300 MW of wind power for $31 million a year


From the March 4, 2014 issue of Public Power Daily

Originally published March 4, 2014

The Austin, Texas, City Council approved a new wind energy contract Feb. 27 that calls for Austin Energy to purchase up to 300 megawatts of wind power from Lincoln Renewable Energy for 18 years for $31 million a year. The price is in the $26 per megawatt-hour to $36 per megawatt-hour range, making it the least expensive wind power Austin Energy has purchased since it began contracting for wind power in the late 1990s, the utility said. The price is lower than the $32/MWh average cost for all power in the Electric Reliability Council of Texas in 2013 and will not increase customer bills, Austin Energy said.

"The new wind contract has come at a good time and at a good price to meet our renewable energy goal early," said Austin Energy General Manager Larry Weis. "Both persistence and patience have paid off."

The contract "positions Austin Energy to achieve its goal of delivering 35 percent of all of its electricity from renewable sources four years ahead of its goal," making it the leader for all large public power utilities in the country, the utility said.

The new 300-MW wind project, with 160 wind turbines, will be built in Castro County, Texas, and is projected to come online in the fourth quarter of 2015. It will replace a 170-MW project that was approved last year but did not materialize, Austin Energy said. The Castro County project is in addition to two other new projects that Austin Energy entered into contracts with last year to purchase wind power. Those two projects, by Duke Energy, are 200 MW each and are scheduled to come online in 2015 and 2016, respectively. 

When the three new projects are all online, Austin Energy said it will have about 1,350 MW of wind power in its portfolio, helping the utility achieve its 35 percent renewable energy goal in 2016, four years ahead of schedule. Austin Energy also currently has about 50 MW of solar power and 112 MW of biomass.

The new wind contracts are the last Austin Energy expects to enter into before 2020, since it has reached its renewable energy goal, the utility said, adding that it will now concentrate its efforts on achieving its solar energy goals. Austin’s solar goals include installing 200 MW of solar by 2020, with half of that installed locally.

 

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