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Oregon Developer eyes 600-MW solar project

Houston (Platts)--12 Jan 2018 547 pm EST/2247 GMT


A solar developer in Oregon is eying the prospects of developing a 600-MW utility-scale solar project that would help replace power lost from looming coal-fired retirements in the Northwest and which would be near the three 500-kV lines that make up the California Oregon Intertie.

Obsidian Renewables, based near Portland, has said its proposed Obsidian Solar Center at Fort Rock, Oregon, in Lake County, would be the "largest and lowest cost" solar facility in the Northwest.

The principal owner of Obsidian, David Brown, said in interview Friday he expects to eventually sell solar power priced at around $36/MWh, most likely to Northwest utilities.

"This project will begin construction by the end of 2019 because of the federal Investment Tax Credit," Brown said.

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The ITC, as the 30% investment tax credit is known, phases down after 2019. Brown said he expects the approval process to take two years, and will build the facility in phases through 2022 and 2023.

Obsidian has 7,000 acres of land under option that is in the high desert area of southern Oregon on the border with California. "This is the sunniest area of Oregon," Brown said, and at 4,000 feet of elevation "has ideal conditions for solar power."

In a state with very little solar generation capacity, Brown chose a 600-MW PV project that is roughly ten times the size of the newest and largest solar facility -- Avangrid's 56-MW Gala Solar project in Prineville in east Oregon.

The cost of interconnecting a 200-MW solar facility is "not much lower than for a 600-MW facility. The main difference, in fact, is the number of step-up transformers you have to have," Brown said.

He said he wants to "amortize the fixed interconnection costs and cost of land use over as many MWs as I can."

Brown argued that market conditions in the Northwest are changing, "as are the ways the market will pay for these [renewable] projects."

He points to the fact that, in Oregon, there is no open access and no customer choice, which is why he might end up selling his solar power to a large corporate user, as Avangrid is doing with its Gala Solar Project.

That facility sells its power to Apple under a long-term contract to power a new data center in Prineville.

The Obsidian project is expected to be near three parallel 500-kV lines of the Northwest Intertie that connects Columbia River dams in Washington to Southern California. This means the Obsidian solar power can be sent either north or south.

Brown said that not only is his project in the sunniest part of Oregon but it will sit on a transmission line "that goes everywhere."


BATTERY STORAGE COULD BE USED


With the region about to lose at least 2,000 MW of coal-fired generation, Brown argues a 600-MW solar facility could pick up some of the slack.

The 1,330-MW Centralia facility in Washington is due to retire by 2021, while the 550-MW Boardman facility in Oregon is to close in 2020. There will also be coal retirements in Utah.

These retirements have led Brown to say that the three utilities he expects to sell his solar power to are PacifiCorp, Puget Sound Energy and PGE.

Brown says he is a believer in the idea that battery storage will eventually be everywhere -- on the grid, in homes and obviously in cars. "Eventually batteries are going to go a long way in smoothing out the power system."

He notes, however, that in a number of recent RFP's some utilities have told bidders, "no batteries."

Brown said, however, he is considering a storage system at the site that will increase the capacity factor of the facility as the battery is dispatched.

-- Jeffrey Ryser, jeffrey.ryser@spglobal.com
-- Edited by Matt Eversman, newsdesk@spglobal.com



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