Distributed Energy Resources

Austin Energy to receive up to additional 200 MW of wind

Texas-based public power utility Austin Energy will receive up to an additional 200 megawatts of wind power from an agreement with E.ON Climate & Renewables, the utility said on Aug. 15.

The Austin City Council authorized the 12-year power purchase agreement on August 8.

Once the project reaches commercial operation in December 2020, Austin Energy customer needs will be met with approximately 61 percent renewable resources, which include previously approved contracts coming online in 2021 and 2023.

The agreement is projected to have a beneficial impact on the utility’s Power Supply Adjustment given current market prices and projected future price expectations, Austin Energy said.

The Power Supply Adjustment recovers the net costs of the kilowatt-hours used by customers. It covers fuel for power plants, the cost of electricity purchased from the grid and any net revenues (or losses) experienced as Austin Energy produces and sells power to the grid. The Power Supply Adjustment is adjusted to reflect the current price of fuel and projected Austin Energy power purchases.

Currently, about 41 percent of customer needs are met with renewable resources. According to the Austin Energy Resource Generation Plan, Austin Energy's goals are to achieve at least 55 percent renewable energy by 2025 and commit to 65 percent renewable energy by the end of 2027.

The $17 million per year utility-scale wind contract does not require Austin Energy to invest any funds in the construction, operation or maintenance of the project.

The project is located in cultivated croplands near four wind farms currently in operation near the Texas coast.

The agreement provides for a non-escalating fixed price per megawatt-hour of energy. This allows Austin Energy to see a pricing benefit from the federal production tax credit available to wind developers. The quantity of production will vary in accordance with wind availability at any given time.

With the E.ON agreement, the utility has 1,795 MW of wind power under contract.

For additional information about Austin Energy’s renewable energy supply mix, click here.