In an announcement made on September 8th, Luminant has agreed to buy 116 megawatts of solar power from SunEdison’s new 800-acre Castle Gap solar facility in West Texas. Luminant is the largest generator of electricity in Texas and had total generating capacity at the end of 2014 of 15.4 GW, including coal, nuclear, and natural gas powered electrical generating plants. Total generation for 2014 was approximately 75% from coal and 25% from nuclear. Luminant is also one of the largest utility purchasers of wind power in the United States with approximately 700 MW of wind power under contract in 2014.
The power purchase agreement is the largest in the nation for a merchant generator operating in a competitive electric market. While still a relatively small fraction of Luminant’s generating capacity, this development represents another important milestone in the future of renewable energy as this decision was based not on government mandates or targets or a corporate commitment to sustainability, but purely on economics. Luminant owns a number of gas-fired power plants that are mostly used as dispatchable sources of electricity. Such a purchase of solar power indicates that it is more economic for Luminant to buy solar generated electricity on the wholesale market than operate an existing, albeit older, gas plant.
Disclosure: Your OWOE Executive Producer was employed by Luminant for several years.