The Turlock Irrigation Board of Directors approved a resolution on Tuesday morning to authorize staff to negotiate a 20-year purchasing agreement for renewable energy.
The Board of Directors approved, on a 4-1 vote, to authorize the purchase of up to 200,000 megawatt hours (MWh) per year.
TID is purchasing the renewable energy as staff projects the need to procure additional renewable power by within the next four years to meet current renewable energy procurement requirements (RPS), approximately 33 percent, as prescribed the by California law.
Currently, TID receives a 30 percent investment tax credit (ITC) for solar projects, however that number will drop by 10 percent after Dec. 21, 2016, unless it is extended.
Based on renewable procurements by other utilities and feedback from renewable energy suppliers, TID staff believes it is currently a “buyer’s market” for renewable energy and thus the right time to negotiate a purchase.
Staff also believes a 20-year purchasing agreement, as opposed to a 10-year agreement, is the most beneficial for the district.
“In the analysis, the 20-year [agreement] was the most economical,” said Willie Manuel, Resource Planning Department Manager for TID.
Director Rob Santos, who casted the lone dissenting vote, argued that a 20-year agreement was too long when considering the uncertainty that is legislation.
“With all of the political uncertainties…I’m not buying the 20-year contract,” said Santos.
Director Michael Frantz had his own concerns on the purchasing agreement, although he ultimately supported the resolution.
“I do support us going forward. I wish we could change the state law, which I know is outside of our scope at little ol’ TID,” said Frantz. "I wish I could change the law to allow us to include the solar contributions of our customers as going towards our renewable portfolio percentage, as opposed to just a reduction to our load."
With the Board of Directors’ approval, staff will now have the task of finalizing the terms and pricing of the agreement.