Port of Oakland signs sub-4 cent contract for solar power

The Port of Oakland, one of the largest in the United States, will buy 11,000 MWh from a solar farm in Lancaster, Calif., which it will re-sell to its tenants at cost.

The Port of Oakland will soon buy 35% of its power from a Southern California solar plant, under a 20-year power-purchase agreement (PPA).

Late last week, the port’s commissioners voted to spend $8.9 million to purchase solar power from a solar farm in Lancaster, California. The farm will expand its capacity to account for the contract, and the expansion will go online by December 2020.

According to notes from last week’s meeting, port officials said they will purchase 11,000 MWh at $39 per megawatt-hour (MWh) and will re-sell the electricity through its municipal utility to tenants of the port, including Oakland International Airport and the seaport. The $39 figure is more evidence of the very low contract prices for solar which have been signed in recent years, reaching a global low of under $27/MWh in Mexico earlier this year.

Rough calculations by pv magazine suggest the expansion of the Lancaster farm will have to be in the neighborhood of 5 MW to accommodate Oakland’s PPA, but the exact figure wasn’t known at press time.

Port commissioners said the contract will provide about 35% of what it needs by 2030 to meet California’s renewable-portfolio-standards (RPS) requirements under California Senate Bill 350, which raised the RPS from 33% by 2020 to 50% by 2030. Currently, a bill is making its way through the California legislature to create a 100% RPS by 2045.

The decision to add solar power to its electricity mix comes approximately one year after the port lost its biggest tenant, Ports of America. Since then, the port has worked to modernize its operations to compete more effectively with its competitors in Los Angeles, Tacoma, Wash., and Long Beach, Calif. Oakland’s port provides nearly 10,000 jobs, both directly and indirectly, in the Oakland area.

Reports say the port is also looking to purchase other types of renewable energy other than solar, including hydroelectric, geothermal, wind and biogas, to comply fully with the law.