San Francisco's PG&E (NYSE: PCG) said today it signed a power purchase agreement with Palo Alto, Calif.-based Ausra for a 177 megawatt solar thermal plant to be built in central California.

Ausra said the project, to be located in San Luis Obispo County, will use only one square mile of land and is expected to start generating power in 2010.

"Solar thermal technology provides our customers with a reliable source of clean renewable energy that is ideally suited to meet peak energy loads," said Fong Wan, VP of energy procurement at PG&E.

The plant will burn no fuel, use minimal water, and have no air or water emissions, according to Ausra.

"This 177 megawatt plant is the first manifestation of Ausra and PG&E's shared vision of competitively priced, large-scale solar electric power," said Glen Davis, exec. VP  and chief commercial officer of Ausra.

At the Clinton Global Initiative annual meeting in September, PG&E and Ausra announced separate commitments to build and purchase 1,000 MW of solar thermal power over the next five years (see Ausra, FPL, PG&E heat up solar thermal).

Juno Beach, Fla., utility FPL Group (NYSE: FPL) also made a pledge at that meeting, committing to 500 MW in the next five years, with 300 MW of that to be handled by Ausra.

Ausra's compact linear fresnel reflector solar technology uses heat from the sun to create steam from water, which in turn powers steam turbine generators.

Ausra said it filed its Application for Certification for the plant with the California Energy Commission, which must grant approval before construction begins.