California approves Solel-PG&E solar contract

LOS ANGELES (Reuters) - The California Energy Commission on Thursday approved a 25-year contract between Solel Inc and Pacific Gas & Electric for power generated from a 554-megawatt solar thermal power plant in the Mojave Desert to come on line by January 1, 2011.

The Mojave Solar Park will be the largest solar thermal power plant in the world when its completed, PG&E said when the project was announced in July.

Financial arrangements were not disclosed.

The power purchase pact approved on Thursday was also first announced five months ago.

Concentrated solar power (CSP) is seen by its advocates as a way to make relatively cheap utility-scale renewable power without creating carbon dioxide emissions, which are by far the leading source of climate changing greenhouse gases.

The Mojave Solar Park is to cover 6,000 acres (2,428 hectares). It will have 1.2 million mirrors and 317 miles of vacuum tubing.

Solel uses solar thermal parabolic trough technology. The mirrors concentrate the sun's light on receivers that contain fluid that turns to steam to spin turbines that make electricity.

Solar thermal power is able to make electricity at utility-scale which solar photovoltaic plants cannot.

Solel's agreement with PG&E is for an estimated 1,388 gigawatts of electricity a year.

Solel is among several developers of concentrated solar power including Ausra Inc based in Palo Alto, California, and BrightSource Energy, based in Israel, that have set sights on the desert areas of California and Nevada for their mirrored power plants.

Solel Inc is the U.S. unit of Israel-based Solel Solar Systems. PG&E Co is the main unit of PG&E Corp..

(Reporting by Bernie Woodall; Editing by Christian Wiessner)