The Austin City Council has reached an agreement to have Austin Energy provide a slim majority of its power from renewable resources by the end of the decade.

The Austin City Council on Dec. 14 approved a contract for the utility to purchase a new 150-megawatt (MW) solar plant from Intersect Power, increasing its capacity to nearly 800 MWs. Austin Energy said it currently produces enough renewable power to meet 40 percent of customers' power needs. Adding the new contract will increase its solar capacity to 792 MW. Add in the 1,400 MW of wind power, and Austin Energy expects to provide 51 percent of its electricity from renewables by 2020.

The deal will cost an estimated $10-12 million per year for 15 years, and Austin Energy projects the agreement will “have a beneficial impact on customer bills based on current market prices and future price expectations.”

“This purchase power agreement not only gets us closer to achieving the City's renewable energy goals, but it's also a good deal for our customers,” said Jackie Sargent, Austin Energy General Manager, in a statement. “I am pleased that we can pursue this affordable project and continue to demonstrate economic and environmental leadership on behalf of our community.”

The city council in August approved the Austin Energy Resource, Generation and Climate Protection Plan to 2027, which aims to increase renewable energy use over the next 10 years. As part of the updated goal, installed solar capacity would increase to at least 950 MWs by 2025.