By contracting with an outside vendor to get solar energy from space, Pacific Gas & Electric Corporation (PG&E) (NYSE: PCG) believes it can get renewable solar-based electricity to ratepayers without going into NASA's business.

PG&E revealed today that it has requested approval from the California Public Utilities Commission (PUC) to enter into a power purchase agreement with Solaren Corp. in Southern California. Solaren would deploy a solar array into space to beam an average of 850 gigawatt hours (“GWh”) for the first year of the term, and 1,700 GWh per year over the remaining term, according to a filing to the PUC.

Under the agreement, Solaren, a startup, would design, build and launch the solar array into space, operate the satellite and deliver the electricity to PG&E's grid.

"There is no risk to PG&E ratepayers for this," said Jonathan Marshall, a spokesman for the San Francisco-based utility.

PG&E filed the application for approval of the power purchase agreement with the PUC Friday April 10. "This was the first one from space," said Christopher Chow, a PUC spokesman.

Solaren is based in Manhattan Beach, Calif., and is seeking investors for a private stock placement to raise "billions" of dollars for its business plan, said Gary Spirnak, CEO of Solaren to Cleantech Group.

Solaren is in talks with investment trusts in Europe and the United States, with which it hopes to finalize investment agreements by the summer, said Spirnak.

Next would come engineering and design of the solar plant that would orbit in space, catch the sun's rays and send them down to a ground station on Earth, he continued.

Solaren says it has a few million dollars in startup funding, but no paying customers, and its web site consists of one page with an animated company logo. However, Spirnak and other Solaren employees have backgrounds from the aerospace business and have been in talks with companies such as Lockheed-Martin and Boeing to build the solar plant and the four rockets needed to send it into orbit.

Spirnak's bio says he was a spacecraft project engineer in the U.S. Air Force and worked at Boeing Satellite Systems. The core team at Solaren appears to have 20 to 45 years of experience in aerospace.

A clear advantage of solar in space is efficiency. From space, solar energy is converted into radio frequency waves, which are then beamed to Earth. The conversion rate of the RF waves to electricity is in the area of 90 percent, he said, citing U.S. government research efforts. The conversion rate for a typical earthbound nuclear or coal-fired plant, meanwhile, is in the area of 33 percent.

"Coal and nuclear plants are just a fancy way of boiling water," Spirnak said, also pointing to the water use inefficiency of current technologies.

Space solar arrays are also 8-10 times more efficient than terrestrial solar arrays, added PG&E's Marshall: "Obviously the sun isn't unavailable at night."

Solar arrays on earth are also affected by cloud cover as well as other impurities in the atmosphere that diminish the amount of sunlight that reaches the panels.

"What makes this unusual is that power from space solar should be available around the clock and year-round," Marshall said.

While Solaren would provide 200MW of electricity to PG&E, according to the filing with the PUC, Solaren anticipates generating a total 1,000MW from its satellite, said Spirnak.

If solar power from space seems to have a science fiction ring to it, it's because it does.

The concept was first proposed in 1941 by science fiction author Isaac Asimov in his book "Reason," about a space station that collects solar energy and beams it to Earth.

"The dots to which our energy beams are directed ... are cold and hard and human beings like myself live upon their surfaces - many billions of them ... Our beams feed these worlds energy drawn from ... the Sun," he wrote, theorizing microwaves for transmission.

The closest comparison to the deployment Solaren envisions is DirecTV, the satellite TV provider, Spirnak explained. DirecTV sends TV signals down to earth on solar-powered RF waves. However, when they reach the earth, the solar energy is wasted, he said, and all receivers pick up is the TV programming. Also, the DirectTV signals are beamed across the whole country to all its subscribers, while with the Solaren service for PG&E, the signal would be tightly focused, aimed at a receiving station in Fresno, Calif.

PG&E also points to recent research that shows the viability of solar from space.

Solar from space research was done by the U.S. Department of Energy and NASA in the 1970s, PG&E noted on its blog today, with renewed interest in it shown during the administration of President Bill Clinton.

The Pentagon's National Security Space office gave solar from space-based solar power (SBSP) high marks in a 2007 report: "There is enormous potential for energy security, economic development, improved environmental stewardship ... and overall national security for those nations who construct and possess a SBSP [space based solar power.]"

Having a large public utility such as PG&E interested in buying energy from Solaren's technology also helps interest investors, said Spirnak.

"Investors always want to know, 'How do you know people are going to buy the power from you?'"

Interview with PG&E  http://blip.tv/file/1997480