BP exiting wind deal with San Diego

Published 30 April 13 02:00 PM

By Morgan LeeAPRIL 22, 2013 

 Government-owned turbines in Mexico, close to Sempra's planned Energia Sierra Juarez wind installation

Plans for a major turbine array in Baja California that would provide power to San Diego are in transition as energy giant BP attempts to sell off its wind energy business, including a 50 percent stake in the project known as Energia Sierra Juarez.

Sempra Energy has used 50-50 investment partnerships with BP to leverage its utility-scale renewable energy portfolio on projects stretching from Hawaii to Pennsylvania. One such project completed in January -- the Flat Ridge 2 Wind Farm spanning 66,000 acres in Kansas -- was billed by the companies as the largest U.S. turbine array ever built in one sweep.

Sempra spokesman Art Larson said the company expects to start construction on the highlands of Baja California later this year and complete the first 52-turbine phase of the project by 2014. That schedule is "subject to meeting certain financial conditions and obtaining regulatory approvals," he said.

The first phase at Energia Sierra Juarez would provide enough electricity at peak capacity to power about 65,000 homes, though actual output depends on variable winds.

London-based BP, still dealing with aftermath of the 2010 Gulf oil spill, announced earlier this month it would sell its U.S. wind business to focus on oil and gas. On Monday, BP said it is marketing the wind business for sale as a single entity.

Asked whether Sempra might buy the assets, a spokesman said the company was considering all options. Sempra has indicated in the past that it would be willing to sell its own renewable energy assets at the right price, but is not currently entertaining offers.

Sempra has said it may eventually extend its Mexico wind project along a hundred-mile stretch of the Sierra Juárez in Baja California. The company operates an expanding natural gas pipeline business in Mexico.

U.S. regulatory approvals for Energia Sierra Juarez have been challenged in U.S. District Court by two San Diego-area environmental groups. Ensenada, Mexico-based Terra Peninsular has filed suit against the Mexico's environment ministry that issued permits for the project.

A U.S. presidential permit last year cleared the way for cross-border transmission lines to carry the wind farm's electricity to California homes and businesses.

In March 2012, state utility regulators approved a 20-year, $820 million power-purchase agreement between project developer Sempra U.S. Gas & Power and corporate affiliate San Diego Gas & Electric. SDG&E customers will pay for the electricity.

Other BP-Sempra joint ventures include:

  • Fowler Ridge 2 in Benton County, Indiana.
  • Auwahi Wind Farm on the Hawaiian island of Maui.
  • Mehoopany Wind in Wyoming County, Pennsylvania.

"BP has been a great partner on the wind projects and all the assets are performing well," Sempra's Larson said.



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