The Guam Power Authority (GPA) in the US is set to sign renewable energy contracts with Hanwha Energy and KEPCO-LG CNS Consortium as part of a Phase II Renewable Acquisition bid.

The contracts will see the supply of clean energy supplied to GPA customers from the 60MW solar farms that will be built by the two companies.

GPA has estimated that the two energy contracts would provide substantial savings to its customers over the term of the contracts based on current and projected Levelized Energy Adjustment Clause (LEAC) rates.

"GPA considers renewable energy as an effective hedge against rising fuel oil prices."

The power authority added that the savings in the first five years would be more than $43m, and all the savings will go directly to ratepayers as part of the LEAC adjustment.

GPA general manager John M Benavente said: “GPA considers renewable energy as an effective hedge against rising fuel oil prices.”

Both Phase II renewable energy contracts are said to have obtained approval from the consolidated commission on utilities and public utilities commission.

Upon commissioning of these projects, GPA is expected to surpass its target of sourcing 25% of its energy through renewable technologies by 2035.

Benavente further added: “With both contacts online in about three years and the award of its next 40MW renewable bid, the authority will exceed the 2035 mandate by 2021.

“Utility-scale renewable projects like these will make the benefits of solar energy available to all ratepayers at rates that are affordable, stable and not subjected to world oil prices fluctuations.”

The contract signing ceremonies are scheduled to take place this week.