CSP World

The City of Victorville, in California, has filed a “Petition for extension of the construction deadline for Victorville 2 Hybrid Power Project” with the California Energy Commission (CEC).

The city is requesting for a five years extension of the deadline for commencement of construction for the Victorville 2 Hybrid Power Plant. The city alleges it has invested a significant amount of money and resources for the permitting and points out the national recession as the reason for its delays in the project timeline.

The proposed project, as you can see inthe CSP World Map, filed for its assessment with the CEC on February 2007 and approved on July 2008, is a hybrid solar-gas plant with a nominal output of 563 MW.

The plant, based on a natural gas combined-cycle, consists of two gas-fired turbines and a steam turbine, which is fed by two heat recovery steam generators –one for each turbine— and the solar field. The solar field will be made with arrays of parabolic trough collectors. This kind of plant is usually known as an Integrated Solar Combined Cycle or ISCC. According to the project description, the solar contribution will provide 50 MW during the daylight hours.

The City of Victorville plan was to take all steps required to bring the project to a “build ready” state and then seek investors to assume ownership position in all or at least a significant portion of the project.

During the project development, the Victorville City Council approved a purchase contract with General Electric to construct the power block and, pursuant to the contract, the city deposited $50 million with GE.

One of the points for the extension request is the lack of financing. In 2008, the city engaged Goldman Sachs as sole placement agent for the equity private placement and lead arranger for the debt financing, but the collapse in the credit markets caused these efforts to terminate, claims the city.

A number of companies have been interested in the project, NRG Energy, Beowulf Energy, QGEN Energy and Panda Fund Development Company have entered into negotiations with the City of Victorville, but none of them finally reached a satisfactory agreement.

The city remains optimistic and is considering the option of developing a gas-fired plant without the solar field. “Interested investors and buyers of whole power have expressed a preference for fast-start, efficient, gas fired resources that will effectively integrate intermittent resources in the region, and less interest in the solar thermal component”, state the city representatives in the filed petition.