February 22, 2017 -- Reaffirming Houston’s commitment to renewable energy, reducing emissions, and saving taxpayer money, Mayor Sylvester Turner and City Council today agreed to purchase an additional 20 megawatts (MW) – for a total of 50 MW of solar power. This increase expands the 20-year solar power purchase agreement (PPA) the City entered into in 2015 with Hecate (now SolaireHolman) and will supply 10.5% percent of the City’s electricity needs with solar power.
“As the nation’s largest municipal purchaser of green power, the City of Houston has a loud and proud history of commitment to renewable energy,” said Mayor Sylvester Turner. “Investing in renewable energy helps the City become more sustainable, but also protects us from market volatility in the long-term. Green power makes smart business sense and is an important tool cities can use to reduce carbon emissions and fight climate change.”
In 2014, as the cost of solar energy began dropping significantly, the City embarked on a process to identify a solar energy provider for 6% of its municipal operations as a step towards diversifying the City’s energy portfolio and securing low cost energy and long term price stability. In 2015, SolarieHolman (formerly Hecate) was selected as providing the best price and value to the City for its proposed 30 MW facility. A key component was the lack of any price escalation or inflation adjustments during the 20-year term. In 2016, SolaireHolman offered the City the option of purchasing an additional 20 MW of solar power. In exchange for purchasing the additional 20 MW, the overall contract price is reduced by 8%, resulting in an estimated $1,956,067 per year of savings over the 20-year term.
Benefits to the City include:
- Minimized exposure to electricity market price volatility
- Realized budget certainty and energy price stability with a guaranteed electricity rate
- Long term savings
- Improved air quality in Houston and Texas
“Engie Solar (formerly Solairedirect) is pleased to grow our partnership with the City of Houston to supply a total of 50 megawatts of solar generated electricity,” said Marc-Alain, Vice President Business Development Americas, Engie Solar. “We are also excited to be a part of the City of Houston’s Sustainability Program, recognized by EPA as a ‘leading Green Power Partner’.”
Through its long standing relationship with the City via its Reliant Energy contracts, NRG’s Business Solutions group provided the financial support for the deal through its offerings that include asset management services, along with a wide array of structured energy and capacity products.
“As Houston’s retail electricity provider, we commend the City for its increased purchase of renewable energy directly from a solar facility in Texas,” said Rob Gaudette, SVP, NRG Business Solutions. “We provide all customers with energy solutions that support both sustainability and economic growth, and are pleased to have facilitated this transaction through our existing retail supply agreement.”Under this amended agreement, SolaireHolman will supply the City’s retail electric provider, Reliant Energy Retail Services LLC (Reliant) with up to 50 megawatts (MW) of solar power from a facility in Alpine, Texas. The facility is expected to come on line in April 2017.
With this addition, the City further solidifies its national leadership in renewable energy. For the past two years, the City of Houston has held the top spot on the U.S. Environmental Protection Agency’s (EPA's) Top 30 Local Government list of the largest green power users from the Green Power Partnership. Houston is also #7 on EPA’s overall Top 100 green power users. The City uses nearly one billion kilowatt-hours (kWh) of green power annually, which represents over 85% percent of its total power needs.