Solar thermal is the way to go, says California’s Public Utilities Commission. Commissioners this week approved a contract between Southern California Edison and eSolar, a firm that plans to build solar thermal energy facilities that could generate up to 245 megawatts of electricity.

Under the 20-year contract, inked earlier this year, Southern California Edison will purchase energy from a planned eSolar plant in the state’s southern Central Valley. The 105-megawatt Gaskell Sun Tower Project is being backed by Google.org, Idealab and Oak Investment Partners.

Once completed, the Gaskell Sun Tower facility would have the capacity to expand to 245 megawatts, making it the second-largest solar thermal facility in the U.S. (The largest is Florida Power & Light’s 310-megawatt installation in the Mojave Desert.) The eSolar plant is scheduled to begin operations in April 2012.

E&E News PM notes that Google.org is backing firms like eSolar on the hope that they can eventually make solar and wind energy less costly than coal-fired power.

Southern California Edison needed state regulatory approval for the eSolar project because the energy currently is expected to come at an above-market price. The state’s OK will let the utility company use special funds to cover the difference in energy costs.

Tags: california, concentrating solar power, solar, solar thermal