Solar Plant_CA_850mw_Calico Solar Project_SCE_Tessera

Southern Cal Edison Pulls Out Of Sister Solar Project

Tessera Solar’s Calico Solar project has been sold to K Road Sun after Southern California Edison announced that it was pulling out of the 663-megawatt San Bernardino sterling engine site.

The project is a companion to Tessera Solar’s 709-megawatt Imperial Valley Solar project that has been halted by a federal injunction for Bureau of Land Management’s failure to consult with the resident Native American people and a secondary federal lawsuit by the Quechan Indian Tribe.

In issuing the injunction, the District Court specifically cited BLM’s lack of effective outreach to the Quechan tribal representatives, issuing the injunction to protect some 300 sacred sites from potential desecration on the massive installation of Irish sterling engines. Output from Imperial Valley Solar was slated for San Diego Gas and Electric Company but is currently in doubt due to the potential loss of 2010 federal grant construction funding. According to Onell Soto, Governor Schwarzenegger’s office has directly disputed the latest District Court action, claiming that “These projects have gone through years of review under state and federal agencies and have been approved.” No comment on BLM’s cited failures to consult that led to the initial District Court injunction was available from Michael Picker, senior adviser to the outgoing Schwarzenegger administration.

So far, no firm has ever brought so many sterling engines online to produce electricity from free solar fusion. It is expected that both SDG&E and SCE will fail to meet state mandates for alternative energy production and acquisition of 20 percent for 2010. Fortunately for holding company shareholders of the two investor owned power utilities, California state law contains no fines or other punitive measures for power utilities that can’t make the 2010 standard.

Year-End LNG Roundup With Powerlink Implications

The solar farm SNAFUs come at a time when Sempra Energy, holding company of SDG&E, faces numerous challenges in its liquified natural gas (LNG) future, some here in San Diego and Baja California, others in the Gulf of Mexico. For the curious, there is even a BP connection in all of this, where Sempra Energy gets paid for BP LNG shipments that never make it to North America. In the Gulf region, Sempra Energy has cut back on LNG processing plans in favor of simply storing it during the current national LNG glut.

At the same time, Sempra Energy faces a number of legal actions related to its LNG facility near Ensenada at Energia Costa Azul. San Diego’s County Board of Supervisors has already voted to request state and federal investigations of Sempra Energy relating to the alleged expenditure of SDG&E ratepayer income for the construction of Don Felsinger’s $20 million 14-bedroom executive getaway at the Costa Azul LNG project. One whistle-blower lawsuit alleges that Mexican officials were bribed; another dismissed lawsuit contends that land was illegally seized to evict a Mexican rancher from his property, and the rancher’s attorney has vowed to re-file that lawsuit to address the Superior Court concerns leading to dismissal.

A potential concern for Sempra Energy (SRE) shareholders who earlier this year voted for some say in executive compensation is that if SRE’s most-senior executive Felsinger actually used the Costa Azul facility in corporate management, then Sempra Energy as a whole maybe subject to Mexican business taxes.

Central to all of this is the potential utility of the Sunrise Powerlink project, now starting construction in San Diego’s East County. With the potential loss of the Imperial Valley solar generation for the foreseeable future, SDG&E will have the option of importing LNG-generated electricity from Mexico, without concern for the heavier sulfur content of Indonesian-imported LNG received in Baja California while the sweeter American LNG sits in Gulf of Mexico storage facilities.

Trend Toward Energy Grid Independence

The Calico Solar sale represents a continuing trend for both large and small SDG&E customers to shed grid dependence with SDG&E having so many varied rate hike requests in the regulatory pipeline before California’s Public Utilities Commission. One specific rate hike proposal, SDG&E’s PeakShift at Work/ PeakShift at Home (PSW/PSH) dynamic pricing hikes on small business and residential SDG&E customers, is designed to drive those customers into weekend and evening off-peak usage, freeing up daytime business hour electricity for SDG&E’s remaining large industrial-sized clients, even as an increasing number of these larger accounts are buying their own less-expensive solar generation facilities.

SDG&E’s PSW/PSH rate hike includes a request to bill customers $118 million for advertising on how evening and weekend power usage is an urgently-needed consumer benefit.

One recently granted SDG&E Z-Factor rate hike is to charge customers $29 million for damages sustained in utility-caused wildfires.

Still to be approved is the Wildfire Expense Balancing Account (WEBA) application that CPUC’s own attorneys fear is an unlimited future consumer liability that stems from utility standard practices which allow for overhead equipment failures. Another CPUC attorney concern: utilities’ secondary WEBA attempts to have CPUC limit their future wildfire liabilities are viewed as an unconstitutional overreach if granted by CPUC.

Residential customers with smaller power demands, many in the Alpine and Ramona areas and still highly suspicious of the local power company after the 2007 wildfire season, have opted to remove themselves from the grid in favor of the independence of off-grid solar power generation. Once solar panels are installed and operational, those homeowners do not pay anything for free solar fusion from the sun. Off-grid solar panels can be found in San Diego County at discount or sale rates of about $3 per watt. Keeping the systems off the grid avoids the need for Federal Energy Regulatory Commission certification that is required before SDG&E will reimburse customers for excess solar electricity seized then sold to their neighbors at a profit for Sempra Energy.


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