Powering Strong Communities

Authority overseeing new Calif. municipal utility executes agreement tied to microgrid

Concentric Power Inc. and Gonzales Electric Authority (GEA), which was established by the City of Gonzales, Calif., to oversee its new municipal electric utility, have executed an energy services agreement to deliver wholesale electric power via a community-scale microgrid.

The microgrid will initially have 35 megawatts of capacity to provide power to the Gonzales Agricultural Industrial Business Park, which houses processing facilities for fresh vegetable and wine producers. It will also meet the clean energy requirements of the city’s climate action plan.

Concentric Power said in an Oct. 7 news release that it designed the microgrid to integrate a mix of 14.5-MW-AC of solar energy, 10-MW/27.5 MWh of battery energy storage and 10-MW of flexible thermal generation, all of which will be managed by the company’s Advanced Microgrid Controller.

The system will allow the park to island from the wider energy grid, “ensuring that end users have reliable, high-quality power 24 hours a day, 365 days a year, even when facing planned or unplanned grid outages,” Concentric Power said.

The microgrid will also include a privately owned substation that will allow energy and capacity services to be sold into the California electricity grid.

The City of Gonzales, which is located in California’s Salinas Valley, formed GEA to help attract and retain a strong agriculture and industrial base as well as to protect companies doing business there from unplanned power outages and poor power quality, Concentric Power noted.

The project will support continued economic development and job creation to further build the city’s tax base. With the Agricultural Industrial Park currently one-third occupied, the ESA allows for the power infrastructure to expand and meet growing demand.

The $70 million project will be funded primarily by Concentric Power, with supplemental funding from GEA and the Gonzales Municipal Electric Utility towards ownership of the distribution infrastructure.

Concentric Power will develop, design, build, operate and maintain the microgrid assets, including both generation and distribution. The distribution assets will be transferred to Gonzales Municipal Electric Utility.

The initial term of the energy services agreement is 30 years and the project is expected to break ground in mid-2021 and be ready for service in 2022.

“Concentric was selected as our partner after undertaking a competitive selection process,” noted Rene Mendez, City Manager for the City of Gonzales. The city received three bids in response to a request for interest (RFI) issued in 2019, he said.

The RFI noted that the GEA microgrid power program’s objectives include, among other things, an integrated microgrid system that, at least in early phases, is independent from the Pacific Gas & Electric power delivery system.

The microgrid program is designed to bring value to the Gonzales Business Park, the RFI said.

This value could take various forms, including:

  • Cost savings for Gonzales Business Park customers (e.g. lower tariffs; flat-priced, long-term contracts; and/or elimination of peak-hour pricing);
  • Protection from PG&E “Public Safety Power Shutoffs”;
  • Alleviation of local distribution capacity constraints; and
  • Rapid response to power delivery requirements from prospective Gonzales Business Park customers.