Dive Brief:

• The Austin City Council approved the building of 800 megawatts of new solar for the city, including 600 megawatts of utility scale solar by 2017 and 200 megawatts of residential rooftop solar by 2020.
• The resolution included language making solar leasing legal, putting a floor price on Austin’s value-of-solar tariff, and a requirement that Austin Energy, the city’s progressive muni, procure 200 megawatts of fast-response storage.
• Concerns from execs at Austin Energy about managing such a large addition of solar to the grid over such a relatively short span of time was part of the reason the City Council’s action included the fast-response storage requirement.

Dive Insight:

The City Council action was recommended by a task force of business and community stakeholders that concluded solar energy is a cost-competitive generation source and a hedge against fossil fuel volatility that should become “the new default generation resource through 2024."

The task force was supported by findings that the plan would save the city money and keep Austin Energy’s prices in the bottom 50% of Texas utilities. And at the $50 per megawatt-hour PPA price the utility agreed to in a recent 150 megawatt deal, it could also save ratepayers millions of dollars per year compared to generation from a new natural gas plant.

Solar analyst Cory Honeyman said achieving the new goals would put Texas among the top ten states for installed solar and the top five for installed utility-scale solar. He noted that higher solar targets across the country are coming from the need to replace shuttered coal capacity and hedge against natural gas price volatility.