California CCA amends PPAs for two large-scale solar-plus-storage plants: One expedited, one delayed

As the sole offtaker of both projects, Key said that although SDCP had “a lot of sway and oversight during negotiations,” it also has “a lot of responsibility as far as making sure the projects remain viable.”

With the pair of developments expected to provide up to 20% of SDCP’s annual load, the projects are seen as crucial in reaching the California CCA’s target of supplying 100% renewably-sourced electricity by the end of 2035.

Expedited COD for SB Energy’s Pelicans Jaw project

The first amendment concerns offtake from the Pelicans Jaw Solar and Storage project, which is located near the unincorporated community of Lost Hills in Kern County, California.

SDCP first negotiated a PPA with project developer, SB Energy, in January 2024 for partial offtake from the facility. However, after further negotiations, the two parties agreed to amend the PPA to cover the project’s full offtake.

“We were able to get a decent discount by taking on the full project instead of [SB Energy] contracting with another counterparty,” explained Key during the recent meeting.

Through this amendment, SDCP negotiated a lower cost of energy whilst roughly doubling its offtake to 400MW of solar generation and 238.5MW of energy storage capacity.

More recently, SB Energy informed SDCP that it would be able to expedite commercial operations of the project from 1 April 2027 to 1 September 2026, in exchange for a “slight increase” to the PPA price.

“Because we have so much leverage with this contract, we’re able to work with the developer to ensure that any price increase … would not have a negative impact versus what current prices would be to buy those attributes on the short-term market,” elaborated SDCP’s contracts director.

Key noted that the amended contract has a built-in pricing adjustment, allowing for SB Energy to achieve a higher PPA price the earlier it brings the project online.

Following a brief discussion and praise from the Board of Directors towards the procurement team, the amendments to the 15-year contract were unanimously approved.

Two-pronged delays for Primergy’s Purple Sage

After the good news came the bad news, with Key presenting details of necessary changes to another PPA associated with a different project, which happens to be the largest in SDCP’s portfolio mix.

“We need to amend the contract if we’re going to move forward and keep the project,” said Key, outlining the severity of the situation.

The project in question is Primergy’s Purple Sage Energy Center, located in Nevada, between Las Vegas and Nevada’s border with California.

As reported by Energy-Storage.news, the initial 20-year offtake agreement was announced last March and covers 400MW of solar generation and 400MW/1,600MWh of energy storage capacity. Although located in Nevada, the project will connect to the California Independent System Operator (CAISO) electricity grid.

Under the terms of the original agreement, Primergy guaranteed to have the project up and running before 30 June 2027.

However, the Quibrook-owned company has requested that the required date for the start of commercial operations be delayed by up to a year after experiencing two major roadblocks during development.

“The first [delay] is this project is in an area that is subject to network upgrades,” explained Key. These delays aren’t just affecting development of Primergy’s Purple Sage project, but have disrupted the timelines for numerous projects.

As reported by Energy-Storage.news, these specific network delays recently forced NextEra Energy Resources (NEER) to renegotiate an offtake agreement with another California CCA, San Jose Clean Energy, relating to a portion of the developer’s Yellow Pine Complex.

The second and more pressing cause of delay comes from the Trump Administration’s enforced pause of all Bureau of Land Management (BLM) activity.

Over 95% of the land for Purple Sage project is located on BLM-administered land and although Primergy is part-way through the permitting process, the developer has yet to obtain full approval.

“[The pause] has caused a ton of uncertainty for this project and others,” said Key.

With such uncertainty, the two parties have amended the contract to account for the BLM not approving the project for another 12 months. However, most worryingly, Key said that SDCP had to “think about what happens if the BLM doesn’t look at the [Purple Sage] project for another three years.”

“It’s a huge concern of ours and a huge concern of each respective developer,” added Key.

With this in mind, Key said that his team had renegotiated the terms of the contract so that if the project never came online, for any reason, SDCP would receive “hundreds of millions of dollars” in damages.

Unlike in cases of other PPA amendments when a delay is introduced, SDCP managed to negotiate the same price as the original agreement.

As with the changes to the Pelicans Jaw agreement, the amendments to the Purple Sage PPA were unanimously approved.

SDCP assesses impact of ‘Big, Beautiful Bill’ to portfolio

As with the rest of the renewables and wider energy industries as a whole, SDCP has spent a “lot of time” over the last few months working out the potential impacts to its portfolio after the introduction of new Federal legislation, including the so-called “One, Big, Beautiful Bill”.

Construction has already commenced on the Pelicans Jaw project, and as long as it meets the contractual online date, it will remain eligible for investment tax credits (ITCs) as provided by the Inflation Reduction Act (IRA).

“We feel really confident about the pricing and being able to hold that despite all that’s going on at a Federal level,” said Key during the recent meeting when discussing tax credits.

With the Bill still subject to changes and final sign off, Kenny Key said that his team were monitoring the legislation “very closely.”

SDCP’s recent meeting agenda packet can be found here (PDF).