UPDATE: Interior Secretary Approves First Solar Project In California

Aug. 10, 2011 - Ryan Tracy - online.wsj.com

WASHINGTON (Dow Jones)--The U.S. Interior Secretary Wednesday approved a solar farm that would be the highest capacity photovoltaic plant ever constructed on public-owned land.

The approval cleared a permitting hurdle for First Solar's (FSLR) 550-megawatt Desert Sunlight project, which needed to pass an environmental review from the Interior Department because it is being built on federal land.

Company spokesman Alan Bernheimer said the approval was a "major milestone" and paves the way for construction to begin this month in the California desert, east of Palm Springs.

First Solar will supply thin-film photovoltaic solar panels, build, and operate the project, but is looking to sell it to a new owner and has not yet announced a buyer. It sold an Arizona solar farm last week to NRG Energy (NRG) under a similar arrangement after the Energy Department finalized a loan guarantee for that project.

A $1.88 billion federal loan guarantee for Desert Sunlight is still pending. The Energy Department offered the guarantee in June, contingent on certain conditions.

The power plant will occupy 4,100 acres and generate enough energy to power 165,000 homes. It will send electricity to Southern California Edison, a subsidiary of Edison International (EIX). The plant "will help power our nation and economy," Interior Secretary Ken Salazar said in a statement.

Wednesday's approval is part of a wider Obama administration effort to speed up permitting for power plants that use renewable energy.

By approving more large-scale solar projects, "we continue to make significant strides in spurring innovation, job-creation, and investment in the private sector while strengthening America's energy security," Salazar added.