Getting power to the people is a major hurdle for state’s renewable-electricity law
Last year, Assemblyman Lloyd Levine co-authored legislation that requires California’s privately owned utilities to generate 20 percent of their electricity using renewable sources by 2010. It was a timely measure: Not only did the legislation recognize the rapid, ongoing depletion of finite energy resources such as natural gas, it also provided economic incentives for renewable-energy sources such as wind and solar power, which don’t produce harmful greenhouse gases.
But with private utilities currently generating just 11 percent of their electricity using renewables and the 2010 deadline a scant three years away, some energy experts question if the new requirements will be met. Levine, who’s become an energy expert in his own right after serving the past four years as chairman of the Assembly’s Utilities and Commerce Committee, is not among the naysayers.
“We’ve given the companies all of the tools they need to comply,” said Levine, who represents Southern California’s District 40, centered around the city of Van Nuys. “I fully expect that they’re going to comply with the law. I have no reason to expect otherwise.”
California currently generates 78 percent of its electricity within the state and imports the remaining 22 percent, according to the California Energy Commission, the agency that provides the Legislature with data and policy recommendations regarding the state’s use of energy. More than a third of that total, 38 percent, is made using natural gas. One-fifth, 20 percent, comes from coal-fired plants outside the state that are counted in the total because they are within California’s control area. Large hydroelectric plants and nuclear reactors generate 17 percent and 14 percent, respectively. Last, and least, come renewables, at 11 percent.
Renewable energy comes from five main sources: geothermal, biomass, small hydroelectric, wind power and solar power. Geothermal accounts for almost half of all renewable energy, about 5 percent of the state’s overall output. Biomass and small hydroelectric each contributed approximately 2 percent, followed closely by wind power at 1.5 percent. Last year’s most talked about renewable-energy source, solar power, provided a measly 0.3 percent.
The five sources collectively constitute the state’s “renewables portfolio.” Levine and his legislative cohorts have been working on a “renewables portfolio standard” that requires private utilities to produce a certain amount of electricity using renewable sources or face penalties.
Senate Bill 107, the bill Levine helped craft with senators Don Perata and Joe Simitian last session, mandates a near-doubling of the portfolio, from 11 percent to 20 percent, by 2010. This session, Levine has introduced legislation, Assembly Bill 94, that requires one-third, 33 percent, of the state’s electricity to be generated using renewable sources by 2020. Although both the 2010 and 2020 deadlines were recommended and endorsed by the CEC, the commission remains skeptical that the standard will be met.
At issue, according to CEC commissioner John Geesman, is the amount of renewable energy the utilities have contracted to develop and the amount they’ll actually be able to deliver to customers.
“As our 2006 report lays out, we think there’s probably adequate energy under contract to achieve the goal,” Geesman says. “But the statute speaks in terms of actual, delivered energy. We’ve been concerned that there won’t be enough delivery under those contracts. Some contracts will be delayed, some projects won’t receive permits, some projects will be canceled entirely.”
Developing a renewable-energy source does not guarantee the electricity will make it to the market, in part because renewables represent a paradigm shift in electrical generation. Contrast the 500 megawatts to 1,000 megawatts generated by, say, a large hydroelectric power plant, to the 1.5 megawatts to 3 megawatts generated by today’s state-of-the-art windmills. The hefty output of old-school baseline power plants justified the cost of expensive transmission lines. On the other hand, renewable sources such as wind farms, located in out-of-the-way areas and generally funded by groups of smaller investors, simply don’t have the financial wherewithal to hook up to the grid.
“The current transmission grid leaves California a little bit vulnerable,” Levine said. “It doesn’t allow us to move the power around as we need it.” According to the CEC’s 2006 Integrated Energy Policy Report Update, alluded to by Geesman above, “the lack of transmission infrastructure to access remote renewable resources is the most critical barrier to meeting California’s 20 percent target by 2010.”
The lack of transmission capacity is particularly crucial for the Sacramento Municipal Utility District, said Michael DeAngelis, SMUD’s program manager for advanced renewables and distributed generation technology. SMUD imports virtually all of its renewable energy from outside its control area, but cannot access the state’s more remote renewable sources, such as wind farms and solar arrays that often are situated far away from population centers, without new transmission infrastructure.
The Tehachapi Wind Farm in Southern California offers a case in point. The 5,000 windmills, sprouting like cactus needles from the Mojave’s barren scrub, currently add approximately 1,500 megawatts to the state’s electrical grid, but could provide more than 5,000 megawatts if transmission lines to carry the power existed. Unfortunately, they don’t, but not for lack of trying, DeAngelis said.
“Southern California Edison has been trying to figure a way within the regulatory structure nationally and within the state to solve that, but it’s been a multiyear problem just getting the authority to build the transmission,” he said, noting that the Federal Energy Regulatory Commission denied Edison’s application last year.
Don’t count on Governor Arnold Schwarzenegger’s infrastructure bonds to come to the rescue, Geesman said. They contain zero funding for transmission infrastructure. The Legislature continues to leave it up to the utilities to develop new transmission, despite the ongoing paradigm shift.
PG&E, Southern California Edison and San Diego Gas & Electric, the state’s three major private utilities, generate 70 percent of the electricity made within the state. Public utilities such as SMUD and the Los Angeles Department of Water and Power produce the remaining 30 percent. The renewables portfolio standard applies legally only to private utilities, but some public utilities, including SMUD, are attempting to meet and even exceed the state’s requirements.
Currently, the two major utilities that provide electricity to the Sacramento region, SMUD and PG&E, are running neck-and-neck in the renewables-portfolio sweepstakes. Both utilities claim to generate approximately 13 percent of their electricity using renewable sources. Both will be hard-pressed to generate 20 percent by the 2010 deadline, but only one, PG&E, legally is required to do so.
Private utilities that don’t make the mark should be prepared to pay up, Geesman insisted. “We’ve been skeptical that they’re on a track to meet the target, and the best way to assure that they are is to make it clear that if they fail, for reasons that are within their control, they will be penalized very heavily.”
Levine remains confident that won’t be necessary.
“You want to set the bar at something that’s achievable but something people have to work for, otherwise it doesn’t do any good,” he said. “I think that they will make that goal, and that people are working in good faith to do that. They’ve got three years.”