Coal Utilities Turn to Solar? Could Happen…
Robert Menard
Certified Purchasing Professional,
Certified Professional Purchasing Consultant, Certified Green Purchasing Professional, Certified Professional Purchasing Manager
One of Texas’s largest coal power utilities is jumping into the solar market. This should not be a surprise. Dallas based Luminant has announced a deal with SunEdison to buy solar energy from a 116 MW facility to be built south of Midland in the Permian Basin renowned for its oil shale formation and oil production capacity.
An 800 acre solar farm will be constructed in a desolate desert area south of Midland, TX. Luminant’s decision is not based upon sustainability mandates. Rather, it admits the economic realities of the marketplace, much as CEO Mac MacFarland claims was done on wind energy a decade ago.
A major economic impetus has been the drastic fall of solar energy costs worldwide, due in great part to Chinese factory output and technology. Solar power may have been initially regarded as an expensive alternative to fossils fuels but with less carbon emissions.
Still a fraction of power generated
The Solar Energy Industries Association reports that solar capacity in the USA hit 18,300 MW in 2014. That amount is less than one third of 1% BUT double what it was in 2012. Such growth was repeated over the previous three years, a feat not nearly matched by any other fuel source, fossil or renewable. Moreover, the Electric Reliability Council of Texas (ERCOT) estimates that by 2029, the state of TX could have 10,000 MW of electric power, 25 times its current production. Solar farms would be located in ideal locations of west Texas with its hot dry climate and sunny skies.
Political realities
The Obama plan to cut carbon emissions by 30% by 2030 is taking its toll. Luminant generated 72% of its capacity from coal in 2014. If the Obama regulations take root and force half the coal plants to close, Luminant, a unit of Energy Future Holdings, currently in bankruptcy, is preparing for the future.