Ormat Technologies: Power Purchase Agreement
Ormat Technologies, Inc. (NYSE: ORA) announced that its subsidiary entered into a 20-year Power Purchase Agreement (PPA) with Southern California Public Power Authority (SCPPA) for interstate delivery of electricity from the second phase of Don A. Campbell in Mineral County, Nevada.
Under the terms of the PPA with SCPPA, the second phase of the Don A. Campbell project will receive a rate of $81.25 per megawatt hour with no annual escalation. SCPPA will resell the power to Los Angeles Department of Water and Power (LADWP). As with the existing Don A. Campbell geothermal plant, electricity from the new project will be transmitted to the LADWP grid via NV Energy's statewide transmission system, including the One Nevada Transmission Line that connects service areas in both northern and southern Nevada.
Ormat recently announced the release of the project for construction, and expects it to generate up to 19 MW (net) on a yearly average basis, above the PPA nominal target of 16.2 MW. Commercial operation is expected in the first quarter of 2016. Northleaf Capital Partners, Ormat's new joint venture investor, will purchase approximately 40% interest in the project which will be added to the existing ORPD joint venture once the project is completed and commissioned.
"This PPA marks our fourth PPA with SCPPA and we are delighted by our continued relationship with LADWP, the nation's largest municipal utility," says Isaac Angel, Chief Executive Officer of Ormat. "We look forward to providing California access to another cost-effective and reliable renewable energy resource."
"We are very pleased to partner once again with Ormat Technologies and SCPPA on the second phase of the Don A. Campbell Geothermal Power Plant, which will provide a long-term reliable renewable power supply for Los Angeles. Geothermal power is critical to reaching our goal of 33% renewable energy by 2020, while transitioning away from coal power," LADWP General Manager Marcie Edwards said.