Arizona utility Tucson Electric Power (TEP) said this week that it will buy solar energy at a historically low price from a new local system large enough to power 21,000 homes.
The 100-MW solar array and an accompanying 30-MW energy storage system are expected to be in service by the end of 2019. TEP said that, excluding the cost of storage, it will buy the system’s output for 20 years for less than $0.03/kWh — less than half as much as it agreed to pay under similar contracts in recent years.
“This new local system combines cost-effective energy production with cutting edge energy storage, helping us provide sustainable, reliable and affordable service to all of our customers for decades to come,” Carmine Tilghman, senior director of energy supply and renewable energy for TEP, said in a May 22 statement.
An affiliate of NextEra Energy Resources will build, own and operate the system on a site owned by the City of Tucson located inside TEP’s service territory south of the metropolitan area.
NextEra also will build and operate a long-duration battery storage system on the site that will help integrate renewable energy resources into TEP’s local energy grid. The storage system will be capable of providing up to 120 MWh of power.