Legislation to increase utility renewable requirement

By CMTA Staff

Capitol Update, Jan. 11, 2007 Share this on FacebookTweet thisEmail this to a friend

Pursuant to legislation and the state "Energy Action Plan", the California Renewable Portfolio Standard (RPS) requires utilities and other retail sellers to increase their level of renewable resources by one percent a year until a 20 percent renewable portfolio is achieved.  Last September, the governor signed into law legislation accelerating the RPS requirement from 2017 to 2010.  And now a key Democratic legislator has introduced a bill to significantly increase the 2010 RPS requirement still further.

AB 94 (Lloyd Levine, D-Los Angeles) requires utilities to achieve a 33 percent renewable electricity portfolio by 2010.

While it is unknown whether utilities and other energy providers would be able to meet the increased requirement, two of the state’s major investor owned utilities (IOUs) appear in good shape to do so.  Both Pacific Gas and Electric and Southern California Edison are well on their way to achieving the 20 percent 2010 requirement: Pacific Gas and Electric’s renewable portfolio is approximately 13 percent, while Southern California Edison’s is estimated at 18 percent.  San Diego Gas and Electric receives 5.5 percent of its power from renewable generation. 
CMTA supports the goal of ensuring that the State has a diverse portfolio of energy resources.  At the same time, all generation resources, including renewables, should be developed and brought online in a cost-effective manner.  This means a rigorous examination of the cost-effectiveness of resources and a continuation of the present statutory cap on the public goods charge (PGC) – which funds above-market RPS costs and other renewable programs.  Recent utility solicitations indicate that prices for some renewable resources, including wind and biomass, have come down.  At the same time, however, the increase in overall spending on ratepayer-funded "green" energy programs – including the recently enacted California Solar Initiative – has and will continue to result in electricity rate increases in California over the near- and mid-term.  This is a matter of great concern to California manufacturers, whose rates are already 80 percent higher than rates for their competitors in neighboring Western states.

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