Tempe, Ariz.-based First Solar (NASDAQ:FSLR) is continuing its transition to being a power producer.
On Tuesday, First Solar announced the signing of a power purchase agreement with the City of Roseville, Calif., whereby First Solar agreed to provide power from its 32 MW Lost Hills solar electricity plant after it has been built in Kern County, Calif., next year. 32 MW is, according to First Solar, sufficient to power 11,000 homes. The supply agreement, which goes into effect in 2015, will run for 10 years. Roseville Electric has purchased 325,000 MWH of renewable energy for $24 million for 10 years.
Roseville Electric Utility Director Michelle Bertolino was quoted in the company press release as saying the supply agreement will "help us reach the state's requirement for 33% [renewable energy] by 2020." The press release says the electricity the municipality is buying from First Solar will cost it $6.5 million less than other offers received in 2012.
Roseville will take 100% of the Lost Hills power plant's output for the first four years of the agreement, subsequently splitting the supply from Lost Hills with a second buyer, Pacific Gas and Electric.