CEC Cuts Renewables Rebates, Approves Inland, Salton Sea Plants

By Published On: December 31, 2003

With little fanfare, the California Energy Commission voted to cut rebates for the highly popular emerging renewables program in order to help spread the funds to roughly 7,200 applicants. The commission voted December 17 to lower the rebate from $3.80/watt to $3.20/watt starting next January to help pay installation costs for small on-site renewables systems. The program drew controversy after the California Public Utilities Commission recently approved a Southern California Edison deal for a 5 MW photovoltaic (PV) project with TrueSolar. PV proponents and others charge that the large and expensive TrueSolar project will drain funds from the emerging renewables pot meant for small distributed-generation systems. According to Tim Tutt, technical director of the renewable energy program, PV providers report that there is uncertainty about how many applicants actually follow through on their initial interest in the program. Photovoltaics developers gauge whether their projects will find a market by signing up reservations. ?The number of reservations doesn?t reflect actual commitment? but instead is a product of aggressive marketing, said Tutt. In another decision, the CEC unanimously approved Calpine?s 670 MW Inland Empire project in Riverside County despite earlier staff objections. Staff said that Calpine had not produced solid details on its plans to secure scarce emissions trading credits for the plant. But outgoing commissioner Robert Pernell and commissioner Jim Boyd earlier this month determined that Calpine gave adequate signals that it could buy offset credits. Following protests by the California Air Resources Board (CARB), the South Coast Air Quality Management District (SCAQMD) last month withdrew plans to reinstate the region?s 14 power plants in the emissions trading market. The district?s about-face came after CARB advised the air district that without credits, power plants would likely take tougher action to control emissions in the smoggy region. Then last week, SCAQMD agreed to allow Los Angeles generators to reenter the emission trading program, which will increase the number of pollution credits. ?Calpine offered to have credits in place prior to construction so it will be exceeding [the air district?s] requirements,? asserted Calpine spokesperson Katherine Potter when asked about the status of the credits. The 185 MW Salton geothermal facility also sailed to approval. The new plant will be the largest steam plant in the country and will be tapped by Imperial Irrigation District customers. The CEC has estimated that the project would avoid $50 million in fuel costs for a similarly sized natural gas?fired facility. Emission credits would be required because the project is located in an area that exceeds allowable pollution levels. Also approved were data-adequacy recommendations for the 120 MW combined-cycle plant for Roseville Electric, to be located in the city of Roseville. The utility expects the plant to meet about 65 percent of its power needs and hopes that it will come on line in 2006. The vote on data adequacy starts the 12-month licensing process for the facility. A committee to oversee environmental review for the proposed Kings River Conservation District?s 97 MW peaking plant in Fresno County also got the green light at the meeting.

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