James Caldwell rises at 3:30 a.m. every Monday to fly from his Sonoma County home to Los Angeles, where he is working to turn the nation’s largest municipal utility into a green model for the future. “I should be growing grapes,” said Caldwell, a forty-plus year veteran of the energy industry. Instead he’s embraced the challenge of figuring out how to reach a 35 percent renewable energy goal by 2020 in Los Angeles, the nation’s second largest city. After serving as a consultant to the Los Angeles Department of Water & Power under its relatively new general manager David Nahai, he became the muni’s assistant general manager of environmental affairs earlier this year. Instead of tending grapes, he’s now very busy cultivating the massive renewable energy resources surrounding the Los Angeles area--desert sun, mountain winds, and geothermal fields along the state’s major earthquake fault, the San Andreas. The aim is to replace the department’s reliance on coal-fired electricity. “We have the technology, we have the resources, and we’ve got the political will,” said Caldwell. “We’ve got a balance sheet and we can borrow.” Even in the midst of the economic downturn, while other companies and public agencies have seen their credit ratings downgraded, LADWP just had its AA rating reaffirmed. Moreover, Caldwell points out that the muni has sufficient transmission capacity to reach its interim 20 percent renewable energy standard by 2010. Lack of transmission has been the bane of many other utilities’ efforts to meet the 20 percent goal, now just two years away. Ironically, Caldwell sees the public power agency’s chief hurdle for its green energy goal as a joint California Public Utilities Commission-California Energy Commission recommendation to the California Air Resources Board for a power industry carbon cap-and-trade program (Circuit, Oct. 17, 2008). If the Air Board--which is responsible for enforcing California’s greenhouse gas reduction law, AB 32--heeds the energy agencies’ advice, LADWP says it could drain it of $2.2 billion, money it needs to finance renewable energy projects. The proposal by the energy agencies would allot emissions credits to utilities based in part on their total customer energy use. Because Pacific Gas & Electric makes most of its power with non-carbon-emitting hydro and nuclear plants, it would have excess credits. However, because LADWP still makes a lot of its power with coal, it would need to buy many of those credits from PG&E to meet its requirements under the program, resulting in what the department calls a wealth transfer. “We’re going to fight it,” said Caldwell, adding the department needs the money for clean energy. “It’s not optional for us.” The other major department effort needed to meet the 35 percent goal is building a new transmission line, known as the Green Path, from the sunny and geothermal energy rich Imperial Valley into its service territory. The muni is considering several possible routes for the line before it begins an environmental analysis of the project next year. The muni also is planning to upgrade two existing lines to bring in more renewable power. In the interim, department officials expect electricity to begin flowing into Los Angeles next week from the first phase of the muni’s 120 MW Pine Tree Wind project in the Tehachapi Mountains. The power should boost the department above the 10 percent renewable energy level this year. Caldwell likes to point out that while private utilities in the state seem to have slowed in their progress on renewable energy, LADWP is coming on strong. “Three years ago we were 3 percent renewables, now we’re 10 percent,” he said. Enough projects already are under contract to hit the 13.5 percent level and enough are in the pipeline to meet the 20 percent 2010 goal. LADWP was quick to install and open phase one of the Pine Tree project, breaking ground on it just a little over nine months ago. The muni also is rolling out a solar energy plan in the weeks ahead that will focus on distributed generation within its service territory. Hand-in-hand with the department’s turn toward renewable energy is its increased emphasis on energy efficiency and re-powering existing natural gas-fired power plants to make them more efficient, Caldwell said. This year, he noted, the department doubled its energy efficiency spending and it plans to double it again next year. “It’s all part of an integrated whole,” he said.
