The deal announced Wednesday calls for the German company to supply up to 726 megawatts of power to the California utility.
Solar Millennium plans to build two 242-megawatt parabolic trough plants in Blythe, Calif. and Ridgecrest, Calif., and possibly a third plant in the future.
The company said it expects to begin construction on the plants next year and start producing power from them by 2013 or 2014, pending regulatory approval.
The plants are to be built on federally owned land, which could slow the projects, since the Bureau of Land Management is facing a huge backlog of applications for solar projects on land it manages in the American southwest (see Pros and Cons of Putting Solar Thermal on Private Land).
The same challenge is facing BrightSource Energy, which plans to build 2.6 gigawatts of solar power plants to deliver electricity to Pacific Gas and Electric and Southern California Edison.
While it has applications before BLM to build on federal land in California's Mojave Desert, it is also planning to build a plant on private land in Nevada (see BrightSource Locks Up Nevada Land for Solar Thermal Power).
Solar Millennium hasn't yet built a commercial-scale solar-thermal plant in the United States, though it is has built and is building more projects in southern Spain that are smaller but similar to those it plans for the Southern California Edison deal.
It has also demonstrated its parabolic trough technology in a test with an existing parabolic trough solar thermal power plant in California, which the company said yielded a 10-percent performance improvement on power production.
Parabolic trough technology – parabolic mirrors that focus the sun's heat on pipes that carry the heated fluid to a turbine for generating power – competes with rival solar-thermal technologies such as the heliostat design used by BrightSource, in which fields of flat mirrors focus sunlight onto a tower (see Solar Thermal: Which Technology is Best?)
California utilities are interested in trying out multiple solar technologies, given that they are subject to a Renewable Portfolio Standard mandate to provide 20 percent of their power from renewable sources by the end of the decade (see Solar Thermal vs. PV: Which Tech Will Utilities Favor?)
Of course, Solar Millennium will need to raise the money to build the projects. The company said it would seek to take advantage of the provision in the stimulus package passed in February that allows solar companies to claim a direct payment in lieu of a 30 percent tax credit for investors in solar projects (see Obama Signs Stimulus Package).
That provision only applies to projects begun before the end of 2010, giving the company a deadline to work towards.
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Tags: ausra, brightsource, bureau of land management, esolar, heliostat, pacific gas & electric, parabolic trough, renewable portfolio standard, solar millennium, solar-thermal, southern california edison