Dive Brief:
- Frontier Renewables has signed two 25-year power purchase agreements (PPAs) with the University of California (UC) system covering 80 megawatts of solar PV-generated electricity expected to be online by the end of 2016. Together, they comprise the largest solar energy purchase ever by a U.S. higher education institution.
- The UC system will direct the solar-generated electricity to UC-Irvine and its medical campus, UC-Merced, UC-San Diego and its medical center, UC-San Francisco and its medical center, and UC-Santa Cruz, through its Wholesale Power Program.
- The purchase was made through UC's registered Electric Service Provider status. UC's Wholesale Power Program will provide 60% renewables-sourced electricity to the university system.
Dive Insight:
The deals add to 33.4 megawatts of installed and under-construction solar on U.S. property are part of the UC system’s new sustainability initiative, which is aimed at making its ten campuses and five medical centers carbon neutral by 2025.
The projects’ end-of-2016 in-service dates are not accidental; solar projects that are completed by December 31, 2016, qualify for a 30% federal investment tax credit while those that are completed after that date get only a 10% ITC.
Such a well-planned use of the ITC is one effective way that the $91 billion dollar UC system investment portfolio's sustainability initiative will invest $1 billion to achieve its carbon neutral target without compromising investors.
The initiative’s Task Force on Sustainable Investing has recommended the U.C. system divest its $10 billion in fossil fuel-related assets.
