Utility PG&E Corp. said today it has entered into a power purchase agreement with Finavera Renewables for two megawatts of ocean energy. The energy will come from an installation located roughly two-and-a-half miles off the Northern California coast that is expected to be completed by 2012. Financial terms of the deal were not disclosed.
The proposed “wave park,” which would be the first commercial wave energy power plant, will consist of eight power-generating buoys. SF Gate reports that Finavera plans to expand the installation up to 100 megawatts if the initial installation works well.
These two megawatts make up a small part of PG&E’s (PCG) expansion of its renewable energy sources portfolio as it aims to meet California’s renewable portfolio standard, which requires utilities to get 20 percent of their energy from renewable sources by 2010. PG&E currently gets 12 percent of its energy from renewable sources.
PG&E’s PPA with Finavera could usher in a new round of venture for the renewable energy company, which also works in wind energy. Under the PPA, Finavera will own and operate the buoys and sell 3,854 MWh of electricity to PG&E each year. The project is expected to offset 245 tons of carbon dioxide annually.
Finavera’s low-profile buoys work by bobbing up and down in the water, forcing pressurized seawater through a turbine. However, the company has had problems with its buoys in the past. Earlier this year a prototype buoy sank off the coast of Oregon. Still, the PG&E agreement bodes well Finavera and the wave industry as a whole, a sector that has gotten a very small amount of capital considering the huge energy potential of the world’s seas.