Sher Bill Would Block TrueSolar Repeat

Though Southern California Edison?s hotly debated pact with TrueSolar Solutions has already made it through the California Public Utilities Commission barn door, a new bill at the state legislature could prevent such a deal from happening again in the future. It also seeks to make renewables account for 20 percent of all the state?s electricity. SB 1478 by Senator Byron Sher (D-Palo Alto) would require utilities to solicit competitive bids for renewable resources prior to signing power-purchase agreements?and those deals must result from the CPUC-approved solicitation. In addition, any project intended to tap into public funding for ?emerging? green technology would be eligible for no more than 10 percent of the total technology funding pot. Late last year, state regulators approved Edison?s contract with TrueSolar, in which the utility agreed to pay 44 cents/kWh for power from a proposed 5 MW photovoltaic assembly (see , Dec. 5, 2003). The fact that Edison is seeking public funding for the project under the California Energy Commission?s emerging or new renewables subsidy programs, which typically fund much smaller applications, has made the proposal a magnet for controversy?along with the steep contract price, the initial secrecy of the deal, and the fact that CPUC president Mike Peevey is a former TrueSolar (and Edison) executive. ?I don?t think anyone imagined something like TrueSolar happening,? said John White, executive director of the Center for Energy Efficiency and Renewable Technologies, adding that Sher?s bill would frustrate future attempts to secure similar deals. Edison?s TrueSolar pact, which still must pass an application for rehearing at the CPUC before it can progress to the energy commission, would not be affected. The Utility Reform Network attorney Matt Freedman sees no justification for granting Edison?s public funding wish. Current law renders the TrueSolar project ?fundamentally ineligible? for cash from the CEC?s emerging resources account, he said. Moreover, ?it would be wrong for the commission? to allow funding under the agency?s new resources account?leaving the project completely ineligible for public financing. Senator Sher?s bill, then, ?would layer more prohibition on top of existing prohibition,? Freedman concluded. The bill also would update state law related to the existing renewables portfolio standard (RPS). Public funding for green projects was based on the goal that 17 percent of utility power in the state come from renewable sources by 2006. With the current drive to have green energy under the RPS account for 20 percent of utilities? portfolios no later than 2010, SB 1478 would seek to make renewable power total 20 percent of all electricity produced in California by the same year. CEERT?s White dismissed the proposed date change. ?I don?t think it really matters, given the CPUC?s glacial pace with implementation? of renewables procurement rules, he said. ?We?re hoping for a solicitation within our lifetime but for excuses, delays, and the strong hand of SoCal Edison everywhere.? White said that regulators had planned for a green solicitation in the second quarter of 2004. Despite growing concern over a shortage of natural gas and thus more urgency to call on renewable sources of power, CPUC members ?are not making decisions,? he said. Ground rules, such as the establishment of a ?market price referent? to benchmark against the cost of green power and standard contract terms, are yet unformed. Calls to CPUC president Peevey?s office on the matter were not returned before press time. Peevey recently told a legislative committee that the first renewables solicitation under the state?s RPS initiative would be put forward by San Diego Gas & Electric this June (see Energy Circuit , Feb. 13, 2004). TURN?s Freedman admitted to being concerned about the CPUC?s progress on the matter but said that regulators have been faced with a run of formidable cases. And solicitations under the RPS initiative will carry forward for years to come, so prospective rules should be considered with care. Still, he expects green solicitations to occur this year. ?Really, the only impediment right now is the commission,? he said. Under the bill, utilities would be barred from signing renewable power deals until they had conducted at least two competitive solicitations ?and power purchase agreements have been entered into with selected projects and approved by the PUC.? Solicitations under the RPS would have to be held no later than June 1, 2005.

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Sher Bill Would Block TrueSolar Repeat

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