A satellite that reaps the sun’s energy in space and beams it down to Earth for use as electricity may leave the realm of sci-fi and edge closer to reality this week following an energy deal in California.

Pacific Gas & Electric Co. (PG&E) has long invested in renewable energy sources, including geothermal, wind and solar. Earlier this week, the utility company reached for the stars in announcing the first-ever deal of its kind: The California power utility, says spokesperson Jonathan Marshall, plans to purchase clean energy generated by a satellite beaming solar power from orbit.

The agreement between PG&E and Solaren Corp., an eight-year-old company based in Manhattan Beach, Calif., still hinges on state regulatory approval. If the deal gets the green light, Solaren must then privately raise billions of dollars to design, launch and operate a satellite as well as an energy-receiving ground station slated for the Fresno County area, says Cal Boerman, director of energy services for Solaren.

The challenges of building this satellite (due to be completed in 2016) and introducing so-called space-based solar power (SBSP) remain formidable. But driven by the urgency of climate change and the lowering costs of solar technology, a growing number of countries and companies believe an energy revolution could be in the offing.

Why bother harvesting solar energy directly from space? It is abundant, and “you can get [this] power 24/7,” says Marty Hoffert, an emeritus professor of physics at New York University. Sunlight is some five to 10 times stronger in space, and its shine would reach energy-gathering satellites placed into geostationary (fixed) orbits—the realm of many currently deployed communications spacecraft—more than 99 percent of the time.

SBSP could, according to energy experts, provide constant, pollution-free power—unlike intermittent wind and cloud cover–sensitive ground-based solar, and without the emissions of fossil fuels or radioactive waste from nuclear power. “[SBSP] is a disruptive technology [in that] it could change the whole energy equation,” says Frederick Best, director of the Center for Space Power (CSP) at Texas A&M University in College Station, Tex.

The premise (and promise) of SBSP has been considered scientifically feasible since the late 1960s. The basic concept of beaming microwave frequencies to Earth from orbit has already been proved: A fleet of solar-powered communication satellites routinely beam various electromagnetic frequencies to ground receivers, linking cell phone calls or relaying TV signals to rooftop dishes, for example. Converting solar energy beamed from space into electricity in a power grid, however, has not yet been demonstrated.

Space Energy, a Switzerland-based SBSP start-up, aims to change that by deploying a prototype orbiter in the next several years, possibly before Solaren’s pilot plant reaches orbit. “You can argue the physics [of SBSP] all day, but you’ll only know with a prototype,” says Peter Sage, a co-founder of Space Energy, started in 2008.

Last year, U.S. and Japanese researchers crossed an important SBSP threshold when they wirelessly transmitted microwave energy between two Hawaiian islands about 90 miles (145 kilometers) apart, representing the distance through Earth’s atmosphere that a transmission from orbit would have to penetrate, says Frank Little, associate director of the CSP.

By Adam Hadhazy