SRP Board Approves Purchase of Additional Ownership Share of Palo Verde Nuclear Generating Station
Increases SRP’s Access to Reliable, 24/7 Zero-Carbon Emitting Energy
SRP’s Board of Directors has approved the purchase of a portion of Public Service Company of New Mexico’s (PNM) share of the Palo Verde Nuclear Generating Station west of Phoenix and certain transmission assets at a cost of approximately $70 million plus the cost of the associated nuclear fuel inventory.
The purchase of 114 megawatts (MW) of safe, reliable and zero-carbon emitting energy from PNM in 2023-24 will help SRP meet customer demand that is growing significantly faster than the national average and defer planned capital expenditures associated with the construction of potential new generating assets. The purchase price represents an attractive economic opportunity for SRP as it is a fraction of the cost to build a new generating facility – something that has been part of SRP’s resource plan for years.
The additional zero-carbon emitting baseload energy from Palo Verde will reduce SRP’s overall carbon intensity and help SRP to meet its 2035 Sustainability Goals, which call for a reduction of CO2 emitted by generation by 65 percent by 2035 and 90 percent by 2050. SRP is also reducing carbon emissions by adding 1,000 MW of solar energy by 2025 as well as new large-scale battery storage projects in Pinal County and the west Valley.
“The Palo Verde Nuclear Generating Station is a high-capacity resource that is well managed and extremely reliable,” said SRP CEO and General Manager Mike Hummel. “The opportunity to economically add this baseload, zero-carbon emitting energy resource to our portfolio will benefit our customers for years to come.”
According to Hummel, the additional zero-carbon emitting energy from Palo Verde also provides increased protection from potential price spikes or scarcity of other resources by adding to the diversity of SRP’s current resource portfolio, he added.
The purchase of the first 104 MW is expected to be completed in January 2023 and the remaining 10 MW in 2024. When completed, the purchase will bring SRP’s ownership share of Palo Verde from 689 MW (17.5 percent) to 803 MW or about 20 percent of the total plant capacity.
SRP is a community-based, not-for-profit public power utility and the largest provider of electricity in the greater Phoenix metropolitan area, serving more than 1 million customers. SRP is also the metropolitan area’s largest supplier of water, delivering about 800,000 acre-feet annually to municipal, urban and agricultural water users.