New supply model delivers competitive and accessible solar to large consumers
HOUSTON (February 2, 2015) – MP2 Energy, a full-service power company, has signed a landmark energy agreement with Rice University that represents the first time off-site solar power is being delivered to a commercial entity on a short-term contract, without state or utility incentives in a deregulated market.
“This deal demonstrates that solar is truly becoming competitive in the most competitive electricity market in the U.S. We applaud Rice for taking a leadership role in embracing true renewable energy,” said Jeff Starcher, CEO of MP2 Energy. “We are breaking down common barriers to using solar energy – issues like long term 20-year contracts and the higher cost of onsite production – through a creative supply model.”
“We’re committed to renewable energy, and for the first time, we could make a strong business case for purchasing solar power,” said Richard Johnson, director of Rice’s Administrative Center for Sustainability and Energy Management. “The ability to prove the cost model and also commit to a short-term contract made this an easy decision.”
This two-year agreement will initially power approximately seven percent of the university’s campus near downtown Houston with green energy. This solar energy will come from First Solar Inc.’s (NASDAQ: FSLR) Barilla Solar Project, which produces 22MW of energy and is located in Pecos County, Texas. With most of its power sold in the real-time ERCOT market, Barilla is well-suited for offering short-term contracts. MP2, which performs energy forecasting and market interface for the Barilla plant, has worked with First Solar to create an innovative, new offtake arrangement for solar generation that works within the competitive Electric Reliability Council of Texas (ERCOT) retail market.
The cost of producing solar energy has drastically reduced as the equipment has become cheaper and as the industry gains more experience installing and financing systems. Starting in 2008, global module prices began a steep downward trajectory, driving installed price reductions of 40 percent among residential and commercial installations from 2008 through 2012. Efforts to drive cost reductions have also been led by the U.S. DOE’s SunShot Initiative, which aims to reduce the cost of grid-connected solar photovoltaic (PV)-generated electricity by about 75 percent between 2010 and 2020.
“This is a game changer for solar energy. We can now offer solar energy at the same rates as traditional gas or coal,” said Starcher. “It’s a lot easier for a business to commit to true renewable energy if we can provide a reasonable offtake term and a competitive price.”
In addition to their solar agreement with MP2, Rice University is committed to sustainability through a variety of campus initiatives, including setting a goal to become carbon neutral by 2038, designing new buildings that achieve the U.S. Green Building Council’s silver level of certification through its Leadership in Energy and Environmental Design (LEED) program for green building, and installing on-site solar panels to generate electricity.
MP2 Energy is a full service power company, serving approximately 750MW to customers in Texas, Illinois, Pennsylvania and Ohio. The company has the unique opportunity to integrate capabilities across its core services from plant development, plant management, demand response, and retail electric supply to the end-use customer. The top tier power company handles all other aspects of the power markets like asset management, commodity hedging, solar installation and offtake, wind and distributed generation. MP2 is a member of the 2014 Aggie 100, which honors the world’s fastest growing companies headed by Texas A&M graduates and was recently honored by TEPA with its inaugural Supplier of the Year award. For more information, visit www.mp2energy.com.
Located on a 300-acre forested campus in Houston, Rice University is consistently ranked among the nation’s top 20 universities by U.S. News & World Report. Rice has highly respected schools of Architecture, Business, Continuing Studies, Engineering, Humanities, Music, Natural Sciences and Social Sciences and is home to the Baker Institute for Public Policy. With 3,920 undergraduates and 2,567 graduate students, Rice’s undergraduate student-to-faculty ratio is just over 6-to-1. Its residential college system builds close-knit communities and lifelong friendships, just one reason why Rice is highly ranked for best quality of life by the Princeton Review and for best value among private universities by Kiplinger’s Personal Finance. To read “What they’re saying about Rice,” go here.
First Solar is a leading global provider of comprehensive photovoltaic (PV) solar systems which use its advanced module and system technology. The company's integrated power plant solutions deliver an economically attractive alternative to fossil-fuel electricity generation today. From raw material sourcing through end-of-life module recycling, First Solar's renewable energy systems protect and enhance the environment. For more information about First Solar, please visit www.firstsolar.com.