The JEA board of directors is considering a $106.6 million agreement to buy 150 megawatts of solar power produced by Florida Power & Light as utility leaders consider expanding in-house solar generation.
Board members voted unanimously to advance the solar deal Dec. 16 during a joint committee meeting.
If approved by the full board, JEA would purchase the power from FPL through The Energy Authority, which is negotiating the deal between the two utilities.
The board is scheduled to meet Jan. 24.
The TEA is an organization that provides services for public power companies. JEA, Jacksonville’s public utility, is a founding member and one of its seven owners.
Canceled solar deals
The possible solar transaction comes nearly six months after JEA canceled contracts with EDF Renewables North America Inc. subsidiaries for 25-year purchase power agreements, leases and interconnection agreements on the five 50 MW solar energy farms after the company claimed a force majeure.
The 150 megawatts of solar power from FPL is less than than the 250 megawatts JEA expected from EDF.
But JEA officials are trying to respond to customers asking for more renewable energy resources to its portfolio and reduce the utility’s carbon emissions.
Board members said Dec. 16 that the purchased power is a bridge to JEA producing its own solar energy.
“I love that we’re saying bridge because we should be saying bridge, right? I think we talked in the (August board) retreat about maybe workshopping solar. That’s a commitment to the community that I’m really interested in as we move forward,” board member Marty Lanahan said.
“So it would be nice for us if we did not need a bridge in the future. I know that’s a long way out. … The longer term solution is to do it ourselves.”
TEA is acting as the intermediary for JEA on the deal with the Juno Beach-based investor-owned FPL.
JEA Senior Director of Electrical Operations Garry Baker said the price for the solar power from FPL would be $45 per megawatt hour in a five-year agreement. That goes to $55.65 per megawatt hour after transmission and ancillary costs.
JEA would receive an average for 383,000 megawatts of power from the deal per year, according to board documents.
The deal would automatically renew unless objected to by either party.
Negotiations also include a 20% discount on FPL’s $2,733.54 megawatt-month transmission and ancillary cost. Baker said FPL has petitioned the Florida Energy Regulatory Commission to approve the discount.
“And we certainly have an out if they don’t achieve that 20% reduction in transportation costs,” Baker said.
JEA would also have to increase its line of credit with FPL by $8 million, according to Baker.
JEA could start getting the solar power in April 2023.
The deal takes solar from 1% to 4% of JEA’s total energy portfolio.
“The benefit of this transaction is to provide a solar bridge to quadruple JEA’s renewable resources today, and it also could provide additional renewable resources for customer programs,” Baker said.
As of the beginning of 2022, JEA says its energy mix includes:
• Natural gas: 57%
• Purchase power: 31%
• Coal and petroleum coke: 10%
• Renewables (biomass, landfill gas and solar): 2%
Solar — take two
Following the EDF cancellation in July , JEA CEO Jay Stowe told reporters after the Aug. 10 board retreat that 2% renewable energy was too low.
“250 megawatts would have been a substantial increase over what we have right now. It’s a little misleading to say we didn’t have a plan,” Stowe said.
“This was one of those things that didn’t work out the way we wanted to.”
JEA is preparing to give in-house solar expansion another try.
Media Manager Karen McAllister said Dec. 16 that the utility expects to issue a request for proposals in January to find vendors to design and build or enter a purchase power agreement with JEA for nearly 300 megawatts of solar.
JEA is looking for four sites at 74.9 megawatts each, she said.
JEA owns the land to do it.
The EDF solar farms had been in development since 2018 before they were canceled. The 400-acre Beaver Street Solar Center and the 400-acre Cecil Commerce Solar Center, both in West Jacksonville, were owned by JEA before the deal with EDF.
JEA spent $34.4 million for three additional sites. The utility paid $18.8 million for 1,895 acres in West Jacksonville to develop the Deep Creek Solar Center; bought another 952 acres for $9 million for the Westlake Solar Center, also in West Jacksonville; and has another 600.98 acres in Northwest Jacksonville under contract for $6.6 million to build the Forest Trail Solar Center.
McAllister said it is too early to know whether a new vendor would need all or part of the land to build the 300 megawatts of solar capacity.
EDF
EDF Renewables North America is an affiliate of the global renewable energy producer and supplier EDF, headquartered in France.
JEA Chief Administrative Officer Jody Brooks said in July that EDF cited changes to U.S. law, as well as supply chain issues that slowed the company’s ability to source solar panels from primarily Chinese suppliers as barriers to completing the projects.
“We studied that to verify those types of claims in their notice to us, and there was a lot of validity to that,” Brooks said. “We didn’t just take it at face value on their notices.”
The slowdown in sourcing materials was also increasing the projects’ costs that EDF wanted to pass on to JEA.
Brooks said EDF requested more time to complete the solar projects which were scheduled to be online by the end of 2022. The company also said JEA would be responsible for what Brooks said would be $3 million in cost overruns.
Sandi Briner, EDF vice president of corporate communications, provided a statement Aug. 2 via email about the canceled solar deal:
“The challenges brought on by the constrained supply chain, coupled with significant cost increase of equipment have unfortunately created a situation whereby the project is no longer economically viable,” EDF said.
“We value our long-term relationship with JEA and understand the complex decision to terminate the agreement. We hope to partner with JEA on a future project.”
JEA executives told the board in August that solar could still be built on some of the former EDF sites.
McAllister said four of the sites are being considered for solar development.
Stowe said in August that the price of solar power had almost reached parity with natural gas and more traditional fuel sources in 2021 before supply chain issues started raising the cost and made it harder to acquire solar panels.
He said a diversified energy mix will help protect JEA against price spikes in one commodity or another.