Council Approves 20-Year, $500 Million Solar Energy Contract

The City Council unanimously voted on Monday to allow Pasadena Water and Power to enter into a $512.2 million, 20-year power contract with Southern California Public Power Authority for solar photovoltaic and battery energy storage.

“This solar agreement is an important step forward in meeting our goal to source 100% of Pasadena’s electricity from carbon-free sources by the end of 2030,” said Mayor Victor Gordo. “This contract is especially timely considering Pasadena’s exit from the Intermountain Power Project. The City, Pasadena Water and Power, and the residents of Pasadena are committed to a clean energy future.”

In 2023, PWP expanded its energy portfolio to include contracts for 25 MW geothermal energy, and one third share of a 117 MW solar energy project. Both acquisitions, which are expected to begin delivering energy in early 2028, were also negotiated through SCPPA and are key to reaching Pasadena’s sustainability goals.

The contract is part of PWP’s efforts to transition towards sustainable energy sources and meet ambitious decarbonization goals. The proposed contract aims to source renewable energy from the Bonanza Solar project, operated by Nevada-based Bonanza Solar.

“That would bring us to that green 95 percent,” said City Manager Miguel Márquez. 

The contract will cover the daily delivery of a maximum of 105 megawatts of solar photovoltaic energy and up to four hours of dispatchable battery energy storage, not exceeding 55 megawatts, during a 20-year term starting Dec. 31, 2027. The Bonanza Project is expected to contribute significantly to Pasadena’s electricity needs, enhance electric reliability, and reduce greenhouse gas emissions and air pollutants.

The contract is a fixed price contract with no exits.

“It is a big contract for 20 years, but that’s just how the industry works,” Márquez said. 

The decision to pursue this contract aligns with Pasadena’s resolution to source 100% of its electricity from carbon-free sources by the end of 2030, surpassing state-mandated targets. 

“I’m excited about this and it bears out the idea that more carbon free energy will become available,” said Vice Mayor Steve Madison. 

PWP has consistently exceeded state compliance targets and focuses on resources that support affordability while meeting Pasadena’s unique energy needs.

The Bonanza Project represents a strategic investment for PWP amidst California’s competitive energy resource market. With the termination of the Intermountain Power Project (IPP) coal contract in 2027, the Bonanza Project’s timing is opportune. It will partially offset the loss of capacity from the IPP exit and contribute to the state’s renewable energy goals.

Through the IPP, PWP sources electricity from a coal-fired plant in Delta, Utah, which also supplies power to Anaheim, Burbank, Glendale, Los Angeles, and Riverside. The IPP terminates in June 2027.

PWP said the Bonanza Project emerges as a cost-effective solution that balances electric reliability, environmental stewardship, and affordability. The proposed contract underscores PWP’s commitment to sustainable energy practices and its dedication to meeting the needs of its community while ensuring a cleaner, greener future for Pasadena.

“PWP has had a long history of decarbonization efforts, which continues with each successive IRP. The 2018 IRP was one of the first SB-100-compliant IRPs in California and includes the City Council’s initiative to restrict any future long-term energy contracts to renewable and zero-carbon resources,” according to a City staff report. 

“The 2023 IRP expands on the 2018 plan by excluding any greenhouse-gas emitting resource after 2030, regardless of its RPS Program qualifications. The 2023 IRP also incorporates a Waypoint in Year 2028 to ensure that past planning carries into the 2028 IRP process, and to reassess developing technology that might be adopted to help achieve long-term goals.”