Joining a would-be trend that includes lawmakers in deep blue Massachusetts, Senate majority leader Kevin de León, D-Los Angeles, has unveiled a new proposal that could become California Democrats’ answer to the limits of cap-and-trade. 

“The California Senate leader has introduced legislation that would require the Golden State to get 100 percent of its electricity from climate-friendly energy sources by 2045,” the Desert Sun reported. “That’s a big step up from the state’s current renewable energy mandate, 50 percent by 2030 — a target that’s only been on the books for a year and a half, and that California is still a long way from meeting.”

“De León’s bill would require California to hit 50 percent renewable energy by 2025, five years sooner than under current law, and phase out fossil fuels entirely by 2045. It’s not yet clear whether the Senate leader will move forward the proposal, which he introduced before the state’s bill-filing deadline on Friday, almost certainly to serve as a placeholder for more detailed legislation that could be fleshed out later. Still, clean energy advocates celebrated the proposal.”

Big goals

Massachusetts lawmakers recently made a bid to make their state the first in the country to draw all its power from renewables. “Lawmakers recently introduced a bill that would require an economy-wide transition to obtaining power via clean sources like wind and solar, and 53 state legislators from both the House and the Senate have shown support for the measure,” Inhabitat observed. “The bill, SD. 1932, also known as the 100 Percent Renewable Energy Act, would set targets of electricity generation via 100 percent renewables by 2035; other sectors like transportation and heating would have until 2050 to make the switch.” 

A few other states have begun to gravitate toward the principle of mostly or totally renewable power. New York “wants 50 percent renewable energy by 2030,” according to the Los Angeles Times, “which is seeking 100 percent renewable energy by 2045.” De León first floated the idea of going full renewable to the Times in January. “Two years ago, California Senate leader Kevin de León pushed through a law requiring the state to generate half of its electricity from renewable sources by 2030,” the paper recalled.

Notes of caution

But while the enthusiasm has largely been couched in terms of using politics to advance moral imperatives, not all green energy advocates have embraced the idea with open arms. “[T]here’s a lot of evidence that 100 percent renewable energy is not the optimal way to decarbonize the grid,” Greentech Media noted. “Let’s say climate change requires massive government investment in clean technologies. In that case, the question shifts to one of efficacy: Since climate change justifies extraordinary measures, what is the most effective extraordinary measure to fight it? That’s where 100 percent renewables plans fall short, for both structural and practical reasons.”

Some analysts have warned that the approach pushed by de León becomes less and less effective the more ambitious it becomes. “The main economic problem facing renewable electric power is that of diminishing returns,” wrote the Niskansen Center’s Edwin Dolan. “It is possible to install great numbers of solar panels and wind turbines, and even to achieve economies of scale, measured in terms of the cost per kilowatt-hour of capacity, as the installations get larger. However, the problem remains of getting the power to users where and when it is needed. The output of solar and wind installations is variable, and the timing of output does not always coincide with the timing of demand. As the number of renewable installations attached to the grid goes up, the percentage of the potential power output that can actually be used goes down and the cost per kWh rises.”

The result could lead businesses to push technology toward arbitrary goals. “Energy companies have traditionally shied away from installing battery systems at their plants because they’ve tended to be expensive,” Ars Technica noted. “But as prices for energy storage come down and states like California require more and more intermittent renewable energy on utilities’ grids, battery installations have been on an upswing.”

But there’s a twist to this story. Recent coverage suggests that PG&E might not put up a fight when its 40-year federal licenses for Diablo Canyon’s two Westinghouse-made nuclear reactors expire in 2024 and 2025. While PG&E’s website depicts a 20-year extension of the licenses as a no-brainer way to keep supplying clean, non-greenhouse-gas power to more than 3 million people, the company’s dithering on the regulatory front has caught environmentalists’ attention.

This is from a recent Los Angeles Times account:

Although PG&E has asserted that the plant’s continued operation would save its customers as much as $16 billion during the additional 20 years, the cost of bringing Diablo Canyon into compliance with environmental and seismic mandates may in fact not be worth the effort.

 

Energy regulators and advocates have few clues to whether PG&E’s goal is to seek Diablo Canyon’s renewal or find an easy excuse for shutting it down early. “They’re so cagey about the future that I can’t help thinking there’s a strategy here,” says Matthew Freedman, a staff attorney for the consumer watchdog group Turn.

 

Freedman believes the utility’s intention is to delay the renewal proceeding long enough to hamper any opposition. In 2007, the state Public Utilities Commission directed the utility to decide whether to seek renewal at least 10 years in advance of the license expirations, so energy planners would have time to figure out how to replace Diablo Canyon’s output if the plant went dark. Waiting much longer would be “reckless and gambling with the public interest,” the PUC said.

Utility: ‘We’ve got a lot on our plates’

A San Francisco Chronicle report, however, is less conspiratorial in its analysis, depicting PG&E leaders as more interested in other issues — starting with damage control with the utility’s reputation over its pending federal criminal trial:

Once eager to extend Diablo’s licenses, company executives now say they aren’t sure. Since the deadly 2010 explosion of a PG&E natural gas pipeline beneath San Bruno, their focus has been on reforming the company and repairing its image, not relicensing Diablo.

 

And any extension will involve a fight. The plant sits within a maze of earthquake faults, all of them discovered after construction began in 1968. Seismic safety fears have dogged the nuclear industry in California for more than 50 years, forcing PG&E to abandon plans for one of its first reactors.

 

“We’ve got a lot on our plates, and we just don’t need to take on another big public issue right now,” said Tony Earley, PG&E Corp.’s CEO.

 

If Diablo closes, no nuclear plant will take its place. California law forbids building more until federal officials come up with a permanent way to deal with the waste. Thirty-nine years after the law passed, that still hasn’t happened.

This aggravates nuclear power advocates, who thought the deep concerns many have about global warming would lead to a renaissance for nuclear power in California and elsewhere. Instead, Japan’s 2011 disaster at its Fukushima nuclear plant has blunted momentum.

Anti-nuclear activists have spent years comparing conditions at Diablo Canyon with those in Fukushima, suggesting its location on or near several seismic fault lines could lead to a Fukushima-style tragedy along the Central California coast. But the claims of close parallels have generally been discounted by conventional California media.

Roughly 1,000 miles away in Wyoming, the developers of what would be the nation’s largest on-shore wind farm quickly caught word of the proposal.

 

California has long represented the holy grail for the Power Company of Wyoming, the Anschutz Corp. subsidiary that has proposed building the 3,000 megawatt Chokecherry Sierra Madre wind farm in Carbon County.

 

California [already had] a mandate that requires 33 percent of its power come from renewable sources by 2020. And with almost 39 million residents in need of electricity, that represents a potentially hefty sum of green electrons.

 

The problem for wind developers in Wyoming, is Brown and other California policymakers have insisted the Golden State meet its 33 percent mark with power generated from inside the state. California is projected to reach its 2020 benchmark on time.

 

But Brown’s inaugural address left many wondering if the four-term governor was coming around to the idea of out-of-state renewables.

 

“They’ve always said if they raised their renewable portfolio, Wyoming would have a place in that new demand,” said Loyd Drain, the executive director of the Wyoming Infrastructure Authority.

 

Drain has spent the last five years lobbying California policymakers on the virtues of Wyoming wind.

 

“They’re going to look to us, I do believe,” he said.

Wind patterns in two states are opposite

Wyoming’s interest in supplying California is backed up by a pioneering study that looks at wind patterns, an important factor, given the great concern about renewable energy being erratic and unreliable as a 24/7/365 source of power.

A new University of Wyoming study further demonstrates that combining the strengths of Wyoming wind with California wind and solar will reduce the intermittency of renewable energy and smooth the power supply — leading to benefits for utilities and energy consumers alike.

 

It turns out that Wyoming’s and California’s wind patterns are rather opposite, and that means that they’re complimentary. When one is active, the other isn’t. Based on a yearly average, California wind is strongest at night, while Wyoming wind is strongest during the day and peaks in the afternoon — coincident with the time when the sun is beginning to set while the electric load is still increasing into the evening hours.

 

“Although the benefits of geographic diversity to renewable energy have been suggested for some time, only recently have there been attempts to quantify these benefits,” says the study’s author, Jonathan Naughton, a UW professor of mechanical engineering and director of the Wind Energy Research Center. “The renewable energy quality metrics proposed in this study are a start at being able to characterize different combinations of renewable energy sources. The result of applying these metrics to energy produced from Wyoming wind and California renewables provides a quite compelling case for geographic diversity.”

But whether this intriguing study and Wyoming’s strong interest will translate into the state becoming a California energy supplier is very much up in the air. Solar power is expanding so quickly in California that utilities are making what appear to be barely disguised attempts to make it a less attractive option for homeowners and businesses considering installing solar panels, as the San Francisco Chronicle reported Thursday. If solar panels keep coming down in price, Wyoming officials’ assumption that their wind power supplies would be attractive to California on cost grounds appears shaky.

Assembly Bill 464: Transaction and use taxes: maximum combined rate. Authored by Assemblyman Kevin Mullin, D-San Mateo, this bill would:

• Raise the local sales and use tax limit from 2 percent to 3 percent

Senate Bill 3: Minimum Wage: adjustment. Authored by state Senator Mark Leno, D-San Francisco, this bill would:

• Increase the minimum wage to $13 per hour by July 1, 2017
• Require annual increases beginning July 1, 2019

Senate Bill 32: California Global Warming Solutions Act of 2006: emissions limit. Authored by state Senator Fran Pavley, D-Agoura Hills, this bill would:

• Extend the provisions of Assembly Bill 32 (2006) until 2050
• Increases the GHG (Green House Gas) reduction to 40 percent of 1990 levels by 2030 and 80 percent below 1990 levels by 2050

Senate Bill 350: Clean Energy and Pollution Reduction Act of 2015. Authored by state Senator Kevin de León, D-Los Angeles, this bill would implement Governor Brown’s green energy plan (50-50-50) by mandating:

• 50 percent of all energy must come from select renewable sources by 2030
• 50 percent reduction in oil usage by vehicles by 2030
• 50 percent more energy efficiency in buildings by 2030

We hear plenty of CARB critics from libertarian and conservative circles. Here’s what a sharp liberal critic of CARB sounds like:

Now, say a utility in a carbon market wants to reduce its carbon emissions. It could build renewable energy generation, or launch efficiency or demand-response programs, but gosh, that stuff is expensive and difficult. Isn’t there something easier and cheaper? Why yes! Here’s two other things it could do.

One, it could sell its ownership stake in a coal plant and buy a stake in a natural gas plant. Voilà! The net emissions of its power portfolio has declined.

Or two, it could shuffle power contracts away from coal plants to unspecified sources, which are treated as natural gas. (More sinister yet, it could help a coal plant obscure the source of its power, rendering it unspecified.) Again: voilà! For bookkeeping purposes, its emissions have fallen.

See what’s wrong here? In both cases, the utility reduced the emissions for which it is responsible, but real-world emissions did not decline at all. The same amount of dirty energy is still feeding into the western grid. The emissions just got “shuffled” off the California utility’s books.

For obvious reasons, resource shuffling is bad news for carbon markets. It makes carbon emissions into a meaningless shell game, exactly the sort of shenanigans cap-and-trade critics are always warning about.

CA regulators saw problem coming

Liberal lawmakers have long downplayed this potential problem. But Roberts says CARB was aware of it and wrote AB 32 to avoid it — at least in theory:

AB32 contains strong language on leakage, saying that regulations must “minimize leakage” and that emission reductions achieved under the program must be “real, permanent, quantifiable, verifiable, and enforceable by the state board.”

And the initial guidance document written by regulators (which details the mechanics of how AB32 is to be implemented) stated clearly that “resource shuffling is prohibited and is a violation of this article.” In fact, the initial guidance contained a provision that would have forced utility executives to testify under oath that their emission reductions were real and not merely shuffled. Powerful and unambiguous stuff!

UC Berkeley research fellow Danny Cullenward tells the story of what happened next:

“[Banning resource shuffling outright] proved controversial. In the months leading up to the beginning of the market’s first compliance period, several stakeholders objected to the resource shuffling rules and began agitating for reforms. The first public proposal came from California’s investor-owned utilities, which in September 2012 advocated a series of exemptions to the prohibition on resource shuffling. The following month, [the California Air Resources Board] directed its staff to develop modifications to the resource shuffling regulations, providing 13 fully developed ‘safe harbor’ exemptions to the definition of resource shuffling directly comparable to, if not more permissive than, the Joint Utilities Group proposal. A few weeks later, CARB staff released a new regulatory guidance document that incorporated these safe harbors, almost word for word.”

So the new AB32 regulations now say that resource shuffling is prohibited … except “when the substitution occurs pursuant to the conditions listed in section 95852(b)(2)(A).” Just a little tweak, right? Except 95852(b)(2)(A) contains loopholes wide enough to sneak a coal plant through. (To see for yourself, check out the current regulations, pp. 106-108.)

In other words: California regulators caved.

CARB’s self-reverence may not be deserved

One person’s view of what constitutes caving might well be another person’s reasonable compromise. But it’s still interesting to see a liberal, deeply informed out-of-state journalist — Roberts lives in Seattle — investigate the air board and conclude that the agency’s high opinion of itself isn’t warranted.

David Roberts will find lots of libertarian and conservative Californians probably agree with him on this, starting with Cal Watchdog contributor … Dave Roberts.

California’s entangled clean energy policy just added another program to an already convoluted, growing bureaucracy. The new program, signed into law August 2 by Gov. Brown, is supposed to assist property owners with financing for green-energy projects.

While a financing component may sound simple, ABX1 14 joins the alphabet soup menu of acronyms that make up the labyrinth of energy program subsidies and incentives in California.

But energy program financing already exists at the state level and in many of the state’s green-energy programs.

Looking onto the California clean-energy program maze is like peeling an onion and discovering layer after layer. Every level of government is involved, but no one can definitively explain where the subsidies are going or how much of the money has been spent. And the money just keeps coming.

ABX1 14 involves just four of the many programs: The California Alternative Energy and Advanced Transportation Financing Authority (CAEATFA), the Property Assessed Clean Energy (PACE) Reserve program, the Renewable Resource Trust Fund (RRTF) and the Clean Energy Upgrade Program (CEUP).

Fortunately, the Legislative Analyst’s Office is currently evaluating the state’s numerous energy efficiency efforts and is expected to publish a report soon.

Alternative Energy

Created in 1980 to finance projects utilizing alternative energy, the California Alternative Energy and Advanced Transportation Financing Authority (CAEATFA) supported cogeneration, wind and geothermal power projects.  In 1994 its charge was expanded to include the financing of “advanced transportation” technologies.

PACE programs provided up-front financing for renewable and energy efficiency-related upgrades to properties. Through PACE, property owners who wanted to install solar or other renewable energy-generating devices or make water or energy efficiency improvements to their properties borrowed funds from their local government program. But the loans were repaid by the property owner over 20 years via an annual assessment on the owner’s property tax bill. The assessment remains on the property even if it is sold or transferred.

Some things have become clear after talking with legislators and staff, the Legislative Analyst’s Office, clean-energy lobbyists and legislative committee staff members. No one really knows just how just large the behemoth is, or where the millions of dollars of subsidies have gone or is going. Ironically, most staffers agree that, because no one knows exactly how much money has been spent or is going to be spent, green-energy subsidies are not sustainable.

Current law required CAEATFA to establish the PACE Reserve program to assist property owners in financing the installation of renewable energy improvements. ABX1 14 will expand the purpose of CAEATFA. And because the federal government didn’t like that the PACE program required a lien on the property, the federal financing dried up.

But because Legislators didn’t want to lose out on the $50 million budgeted for the PACE program, ABX1 14 was created. The bill says, “Existing law, until January 1, 2015, appropriates up to $50,000,000 from the Renewable Resource Trust Fund to the authority for the purposes of the PACE Reserve program and authorizes the authority to expend up to $300,000 of that appropriation for initial administrative costs in implementing the PACE Reserve program.”

The final version of the bill authorized up to $550,000 for administrative costs.

Repurposing

The bill is more of a repurposing of the PACE money. The same goals are in place — to create clean energy jobs — but it’s no longer tied to a lien on property.

The CEUP, offered by the California Energy Commission (CEC), has similar goals to help put people in contact with banks for clean energy financing.

Are you confused yet?

Most agree that pursuing clean energy is a good goal. But this latest bill seems just to create another clean-energy program, while adding to the bureaucracy. It is amazing how many hands are in the clean-energy pot of money, and how many government departments are involved.

The real purpose of the bill is to make sure the $50 million is spent, according to one Capitol staff member who asked not to be named. And according to the staffer, there are far too many state employees currently working in green energy-related jobs in which the project financing has been milked and strung out. The staffer said that the $550,000 administrative costs in ABX1 14 will help to keep those jobs funded.

The CAEATFA Authority consists of five members: California’s Finance Director, the chairman of the California Energy Commission, the president of the Public Utilities Commission, the state Controller and the state Treasurer.

Calls made to the governor requesting information about his support for the bill were not returned.