Commercial, Finance, Industrial, Solar - May 13, 2020
Solar project to power Toyota and Dow approved by PSC
Toyota and Dow Silicones Corporation will soon be receiving solar power from a 100 MW project that was just approved by the Public Service Commission (PSC) in Kentucky on May 8 to be sourced by their local utilities.
The two companies entered into a joint 20-year agreement through Louisville Gas and Electric Company and Kentucky Utilities Company’s Green Tariff Option #3 that will allow Toyota to purchase 50% and Dow to purchase 25% of the electricity generated by the Rhudes Creek Solar project, with the remaining 25% to be allocated to the utilities’ existing customers. The PPA that would allow LG&E/KU to acquire the power from the solar project was first submitted to the PSC for approval in January.
The solar project will be constructed in Hardin County and will be a wholly-owned subsidiary of ibV Energy Partners.
As part of their approval of the Renewable Power Agreement, PSC emphasized that such a contract between a utility and a corporate customer would be allowed so long as it does not increase costs for the utility’s non-participating customers. LG&E/KU will have the opportunity to propose that the costs of the energy minus any revenue from the sale of RECs of their 25% portion be passed through the LG&E/KU Fuel Adjustment Clause (FAC). To enforce this, the PSC order mandates that LG&E/KU submit monthly FAC filings to document fuel cost savings and REC revenues to ensure the energy from the PPA is beneficial.
“The PSC also approved proposed amendments to the Green Tariff, allowing for an increase from a system cumulative of 50 MW to 125 MW each for LG&E and KU in future RPAs,” the PSC order states. “The PSC has directed LG&E and KU to add terms to the Green Tariff Option #3 to establish clear guidelines and standards of review for future RPAs. These guidelines are intended to provide regulatory certainty for corporate customers.”