The City Council for the public power community of Danville, Va., on Aug. 16 voted to approve and authorize Danville’s city manager to enter into a 15-year purchase power agreement (PPA) with American Municipal Power (AMP) for twenty megawatts of solar energy, capacity and renewable energy credits for a price not to exceed $50/megawatt-hour.
Danville is a member of AMP, a joint action agency based in Ohio, which has 133 members -- 132 member communities in Indiana, Kentucky, Maryland, Michigan, Ohio, Pennsylvania, Virginia and West Virginia, and one joint action agency in Delaware.
In a memo submitted to the city council, Jason Grey, Director of Utilities for Danville, said that market energy prices over the past eight months have increased significantly because of various factors around the world. He noted that approximately ten percent of the city's energy is purchased on the daily energy market.
“The city's energy needs are growing due to recent economic development announcements in 2023/2024 that will increase that market exposure from 10% to an estimated 17%,” Grey said in the memo.
Entering into the 15-year solar purchase power agreement will help to reduce the city's market exposure and take advantage of a low-cost, renewable, joint venture that will benefit Danville Utilities electric customers, Grey said.
Danville will purchase the energy from a 150-megawatt solar farm in Ohio.
The memo noted that AMP issued a request for proposal (RFP) in 2021 for a solar purchase power agreement. The responses were short-listed and the best-rated and most economical project was chosen to negotiate a term sheet.
The Avangrid project in western Ohio was selected as the preferred project to pursue from the RFP.
AMP is currently in the process of subscribing the 150-MW solar farm to see if there is enough interest from the AMP members to move forward with the project, the memo said. The deadline for commitments is September 2022.