Southern Company will develop a solar project
In one of the other major developments in the US power sector last week, Southern Company (SO) announced that it will develop a 131 megawatt solar PV project in Georgia. The project will be part of SO’s unregulated operations.
The project’s construction will start in September next year. The commercial operations will start by the end of 2016.
About the project
Through its subsidiary, Southern Power, SO will sell the generated electricity. It will also sell the associated renewable energy credits, or RECs, from this facility to three Georgia-based electric membership corporations.
RECs are issued to power companies that produce power from renewable sources. These certificates can be traded in the market. The government uses them as a tool to promote electricity generation from renewable sources.
The electricity to these corporations will be sold through long-term power purchase agreements, or PPAs.
SO’s solar capacity
As of 2013, SO had the fourth largest solar fleet in the US—after NRG Energy (NRG), NextEra Energy (NEE), and Exelon Corporation (EXC). All of these companies are part of the Utilities Select Sector SPDR (XLU).
As environmental regulations tighten on conventional electricity generation in the US and solar electricity becomes more affordable, large power companies are starting to invest more in renewable energy. Earlier this month, Duke Energy (DUK) received regulatory approvals to construct a solar facility in North Carolina.
Recently, SO has been increasing its solar capacity. In October, it announced the acquisition of 150 megawatts of solar capacity from First Solar (FSLR) in California. Previously, SO partnered with Turner Renewable Energy to acquire seven solar generation facilities.