Analysis says GHG standard could increase electricity prices

By CMTA Staff

Capitol Update, May 19, 2006 Share this on FacebookTweet thisEmail this to a friend

The momentum propelling Senate President Pro Tempore Don Perata (D-Oakland) and his greenhouse gas (GHG) performance standard bill, SB 1368, has slowed a bit, thanks to a recent Senate fiscal analysis.

The bill, which would require the California Energy Commission (CEC) to set emission standards for electricity providers, was sent to the Senate Appropriations Committee "Suspense" file after a committee analysis cited the bill’s fiscal impact.   

According to the Senate Appropriations Committee analysis, "to the extent the [SB 1368] regulations limit the number of suppliers who may provide power to the California market, the bill could increase wholesale electricity costs."  The fact of the matter is, if the bill were to become law, it would unquestionably increase electricity costs.

As a suspense item, it will undergo further scrutiny and another vote.  It is likely that the bill will eventually pass the committee given the intense interest this year on the issue of global warming and the fact that the Senate Democratic leader is the author, but it is nevertheless a setback for the bill and its supporters.

CMTA is a member of a broad coalition engaged in responding to legislation affecting GHG emissions in California.  SEE California believes that efforts to reduce GHG emissions should be accomplished in a manner that will not jeopardize our state's economy, jobs and energy supply. The approach proposed in SB 1368 would limit the ability of utilities to make long-term purchases, discriminate against low-cost coal resources, increase costs to businesses and retail-end customers and threaten the reliability of the state’s electric grid, making it less reliable during peak hours.  

The committee will take up the suspense file in the next two weeks.
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