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Sempra Energy has taken its first step into the clean energy business by buying rights to a proposed wind farm in Baja California.
The company said yesterday that it will buy co-development rights from Cannon Power Corp., which is also based in San Diego, to a proposed 250-megawatt wind generation project in La Rumorosa, about 70 miles east of San Diego and south of the international border.
Sempra declined to disclose what it paid for its interest but said that full development of the wind farm would cost about $400 million. A 250-megawatt project could generate enough electricity to power tens of thousands of homes or more, depending on wind conditions.
The proposed La Rumorosa project would produce electricity from as many as 125 wind turbines along the eastern ridge lines of the Sierra Juarez mountains near La Rumorosa. All of its energy is planned for export to the United States, Sempra said.
The wind farm would not require “significant” transmission upgrades to reach the U.S. power grid, said Michael Allman, chief executive of Sempra Generation, a unit of the parent company. Instead, the project would link into San Diego Gas & Electric’s existing Southwest Power Link, a major transmission line that parallels Interstate 8, he said.
“What we are buying is a land lease, a place to put the turbines in a location where data on wind conditions has been gathered,” Allman said. “We’re also picking up where Cannon is in negotiations for customers for the electricity.”
He added that the region could potentially generate up to 1,000 megawatts of wind energy. But before the project can proceed, Allman said, the company must sign a contract with a customer for its electricity.
The Sempra executive said he hoped to accomplish that this year.
SDG&E, a Sempra-owned company, as well as other state utilities, are scrambling to meet a California mandate that they generate 20 percent of their electricity from renewable sources by 2010. The utility says it now has about 15 percent renewables under contract.
But under state regulations, SDG&E’s energy procurements must be done through competitive bidding, subject to review by the California Public Utilities Commission. So, the La Rumorosa project would have to prove superior to other energy projects for SDG&E to buy its power.
Gary Hardke, managing director of Cannon, said La Rumorosa was ideal for wind power development and that the company looked forward to helping Sempra build a reputation as significant renewable power company. Cannon says it has more than 26 years of experience in developing wind turbine sites.
Until now, Sempra has billed itself largely as a utility and natural gas infrastructure company. For example, the company is building a liquefied natural gas receiving terminal near Ensenada in Baja California, as well as a major west-to-east natural gas pipeline that it calls the Rockies Express.
Bill Powers, co-chairman of the Border Power Plant Working Group, a local watchdog group and frequent critic of Sempra, said the La Rumorosa area has been identified for decades as a promising location for wind projects.
The group strongly supports renewable energy projects, Powers said, provided they are sited appropriately. He noted that at least one other company has plans for a wind farm in that region of Baja California.
“We need to get a team out there to identify high value aesthetic and natural resource areas,” Powers said. “There are parts of that region that are crown jewels of the backcountry.”
By Craig Rose
30 June 2007
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