US utility Xcel Energy has signed a power purchase agreement (PPA) with NextEra Energy Resources from two under-construction solar power units.
The farms — situated outside Roswell, New Mexico — have a combined capacity of 140 MW.
The PPA is currently awaiting approval from the New Mexico Regulation Commission. Xcel Energy is reportedly trying to complete the addition of the projects ahead of revocation of federal investment tax credits on new projects slated for 2016.
David Hudson, the president of Southwestern Public Service Company, a subsidiary of Xcel Energy, said the deals would help the company keep its costs low.
“Not only is solar energy dropping in price, it also displaces megawatts generated from some of our older, less-efficient natural gas-fueled plants.
“This saves on fuel costs and environmental compliance for years to come, and these savings are passed directly on to our customers in Texas and New Mexico,” Hudson said.
Mike McLeod, the regional manager for community and economic development in Roswell, said the projects would benefit surrounding areas.
“The NextEra Energy Resources projects increase the value of rural land. In turn, the higher values generate more long-term tax revenue for local governments.”
Ajith Kumar S