PG&E said Monday that it will buy 177 megawatts of solar power from a plant to be built in San Luis Obispo County by Ausra, a Palo Alto company.

Solar thermal power provides "a reliable source of clean energy that is ideally suited to meet peak energy loads," Fong Wan, vice president of energy procurement of Pacific Gas & Electric, said in a statement.

PG&E would not disclose the price it will pay for the megawatts.

Glen Davis, Ausra's chief commercial officer, said his company and PG&E have a "shared vision of competitively priced, large-scale solar electric power."

Gov. Arnold Schwarzenegger praised the deal, citing it as evidence that California companies are "rising to the challenge of AB 32," the state's landmark climate-change legislation.

Ausra uses a collection of mirrors - it calls them Compact Linear Fresnel Reflectors (CLFR) - to direct sunlight to heat water to create steam. The steam powers a turbine that creates electricity.

The plant will be built in the eastern portion of San Luis Obispo County, off Highway 58 near the small towns of Simmler and California Valley, and not far from the Carrizo Plain National Monument. The location is near existing transmission lines.