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Duke Energy Corporation [3]and the Arizona Public Service Compay [4] (APS) have signed a power purchase agreement (PPA) for electricity generated at two recently acquired Duke Energy photovoltaic (PV) solar installations in Arizona.

APS has agreed [5] to buy all of the energy produced at both the 5 MW Ajo Solar Project and the 15 MW Bagdad Solar Project in two separate 25-year PPA contracts. In August Duke Energy subsidiary, Duke Energy Renewables, acquired the projects from Recurrent Energy growing a rapidly expanding renewable energy portfolio. Ajo Solar, which came online at the end of September, and Bagdad, which is expected to be commercially operational by the end of 2011, will join seven PV generation facilities Duke has in operation.

Though most of its renewable energy portfolio is made up of its 1,000 MW wind generation capacity the addition of these two Arizona solar farms will nearly double Duke's the solar capacity. When complete the Bagdad installation will represent the company's largest solar farm surpassing a 14-MW solar farm Duke Energy owns in San Antonio, Texas.

For APS this contract will move the company further towards both its own renewable energy plan as well as the state mandated renewable portfolio standard (RPS). Under Arizona's RPS utilities must source 15% of their energy from renewable resources by 2025. In order to achieve this, as part of its 2012 Renewable Energy Plan, APS committed to adding 150 MW of utility-owned solar capacity and another 150 MW in renewable energy PPA's or renewable credits (RECs).

Last week the company announced [6] that solar developer SOLON SE [7] had brought the APS-owned 17 MW Cotton Center Solar Plant located in Gila Bend, AZ.

Image Credit: bikephotomusic [8] via Flickr.