NRG Energy, Inc. (NYSE: NRG), through its wholly-owned subsidiary NRG Solar, today announced the acquisition of a 25.65-megawatt (AC) solar project on the island of Guam from Quantum Guam Power Holdings, LLC, a wholly-owned affiliate of Quantum Utility Generation, LLC (QUG).
Guam, a U.S. territory subject to U.S. law and environmental regulations, currently relies on expensive imported residual fuel oil and diesel to generate 100 percent of its power requirements. In order to help mitigate Guam's exposure to fuel price volatility future environmental regulations, NRG Solar will construct, own and operate the solar project which will sell all of its power output to the Guam Power Authority (GPA), the island's sole electric utility, under two twenty-five year power purchase agreements (PPA). The PPAs will allow GPA to supply its customer's power more cleanly and cost-effectively than any other generation source currently in operation on Guam. According to the GPA estimates, the project is expected to generate enough clean solar power during the PPAs to offset consumption of almost 2 million barrels of residual fuel oil and diesel, representing total fuel cost savings to GPA of over $300 million and net savings of approximately $100 million.
"NRG Solar has been focused on reducing the levelized cost of solar energy in both the utility and distributed solar markets," said Tom Doyle, President and CEO of NRG Solar.
"Our focus has been on driving down the balance of system costs through in-house engineering, procurement and construction, as well as through creative financing strategies on well-developed projects. The result of this effort provides us with opportunities like the Guam project which was successfully-developed by QUG and is now ready for NRG Solar to assume long-term ownership of the project. We are proud to partner with GPA in paving the road for the development of this and other renewable energy capacity on Guam."
"GPA has been an excellent partner during the development phase of Guam's first utility-scale renewable project," said Sean O'Donnell, CFO of QUG. "We are pleased to bring the development phase to a successful close and facilitate the transfer of the project to a highly-capable renewable energy company like NRG Solar to continue with construction and operations. We are confident that the good working relationships established with GPA and other island stakeholders will result in the successful commissioning of the project and in additional solar development on the island."