On Dec. 19, San Diego Gas and Electric filed suit against NaturEner, which operates wind farms in Montana. The suit alleged NaturEner did not meet its contractual requirements to preserve eagles, raptors, bats and other protected bird species for electricity sent to California.

A renewable energy company in Madrid, Spain owns San Francisco-based NaturEner. The lawsuit is the first to allege harm to the environment from the purchase of air pollution credits mandated by California’s cap-and-trade program.

From 2008 to 2012, SDG&E finalized a $285 million contract with NaturEner to buy Tradable Renewable Energy Credits from NaturEner’s Montana wind farm, instead of more costly pollution permits through California’s cap-and-trade system. Cap and trade is a system of capping air pollution by having to buy pollution permits in an auction rather than paying a pollution tax.

SDG&E sought to buy cheaper pollution credits to keep its electric rates low to customers. Buying pollution credits from NaturEner’s Rim Rock wind farm in Montana would contribute about 3.5 percentage points of the 33 percent renewable mandate by 2020 under Senate Bill 722, which Gov. Jerry Brown signed into law in 2011.

As reported in the Montana Great Fall Tribune, SDG&E Spokesperson Jennifer Ramp said, “Unfortunately, the project’s owner, NaturEner, did not meet contractual requirements, so SDG&E has decided not to make the investment in Rim Rock (wind farm) or to continue purchasing its renewable energy credits.”

Countersuit and eagle detecting radar

NatureEner immediately filed a countersuit on Dec. 20 in a Montana District Court. The suit alleged that SDG&E’s action is motivated by “buyer’s remorse” due to the falling price of renewable power.  NaturEner said it had implemented state-of-the-art wildlife protection measures in its Montana Rim Rock wind farm project.  The measures include radar detection systems for eagles; and the positioning of trained avian biologists that can pause wind turbine blades as part of NaturEner’s 24-hour Operations Center.  NaturEner claims no eagle has ever been harmed at its project.

NaturEner spokesperson Patrick Ferguson said, “Conditions in the contract require us to develop a documented bird and bat conservation strategy in consultation with the U.S. Fish and Wildlife Service. We’ve done that. We have met the contract conditions.”

NaturEner also filed an emergency injunction to prevent SDG&E from terminating contracts by January before the dueling lawsuits can be heard in court.

Environment versus renewables

Wildlife impact issues have frustrated SDG&E’s efforts to meet its cap-and-trade mandated 20 percent reduction in air pollution.  SDG&E also depends on its 117-mile Sunrise Powerlink transmission line linking it to renewable energy projects in Imperial County.

Environmentalists had opposed the Sunrise Powerlink project on the basis of harm to golden eagles, bighorn sheep and the checkerspot butterfly. The Sunrise Powerlink was forced to alter its original route by California Public Utility Commission Administrative Law Judge Jean Vieth due to wildlife impacts.

On Nov. 20, U.S. Superior Court Judge Gonzalo P. Curiel dismissed a lawsuit brought by three environmental groups against the U.S. Fish and Wildlife Service alleging adverse impacts of the Ocotillo Express Wind Farm Project in Imperial County on bighorn sheep.

More equal animals

The legal disputes between the renewable energy industry and environmentalists is bound to heat up in California since the order by the California Water Resources Control Board to shut down 19 coastal power plants mainly due to harmful impacts on millions of fish larvae.

In Morro Bay, Dynergy has mothballed its gas-fired power plant rather than retrofit its plant with an expensive air-cooling system.  The California Valley Solar Ranch located in inland San Luis Obispo County is replacing the Morro Bay Power Plant.

However, solar farms, especially those using concentrated solar tower technology, have also been implicated in bird deaths.  There were 20 bird deaths reported in Sept. 2013 attributed to Bright Source Energy’s 459-foot solar tower at its Ivanpah Solar Project in the Mojave Desert at Primm, Nev.

And AP reported on Nov. 23, “A study in September by federal biologists found that wind turbines had killed at least 67 bald and golden eagles since 2008. Wyoming had the most eagle deaths. That did not include deaths at Altamont Pass, an area in northern California where wind farms kill an estimated 60 eagles a year.”

Are fish larvae more important than birds?

California set a legal precedent when it admitted retroactive environmental lawsuits in the case of dust storm impacts on Owens Lake brought by the Great Basin Unified Air Pollution Control District against the Los Angeles Department of Water and Power for taking water from Owens Lake.

This raises a legal question of whether renewable energy projects that have already received environmental clearances could be re-opened and challenged because of the bird deaths, or for other reasons. That’s what the courts also will have to sort out.

July 2, 2013 

By Wayne Lusvardi  

Public, municipal and private power companies throughout California buy hydropower from the Western Power Administration. This means ratepayers across California are paying for a wind farm transmission line that benefits only those who live in Alberta, Canada with subsidized power and reduced air pollution. 

Obama administration directives increasing hydropower electricity rates over the past two years to fund green projects caused the U.S. House Committee on Natural Resources to hold a hearing in Washington, D.C., on June 26. It was called, “The Power Marketing Administrations: A Ratepayer Perspective.”

Rep. Tom McClintock, R-Elk Grove, chairman of the Subcommittee on Water and Power, and Rep. Doc Hastings, R-Washington, chairman of the Natural Resources Committee, called the hearing.

McClintock summed up the reason for the hearing:

 “Today the subcommittee hears from the ratepayers who are bearing spiraling costs for electricity caused by ill-advised government policy. For example, we will hear that Central Valley Project power customers are being fleeced by an unaccountable tax program that lavishes funds on environmental causes while inflating electricity prices to cost-prohibitive levels.” 

Montana to Alberta Tie Line

Of particular issue is a mandate imposed on the Western Power Administration to finance $161 million of the costs of the Montana to Alberta, Canada Tie Line, a 214-mile transmission line linking wind farms in Montana to provide power in Alberta, Canada.  The Western Power Administration is an independent agency that runs 56 hydropower plants generating 10,505 megawatts of power from 15 Central and Western states, including California and Montana.  The federal mandate comes from Order No. 1000 of the Obama-controlled Federal Energy Regulatory Commission, which forbids discrimination against wind energy projects.

Newspapers in Canada heralded the project as a “New Merchant Transmission Line with Montana a No-Cost Line for Albertans.”

California pays and Canada benefits

Boasted Dawn Delaney, a spokesperson for the Alberta Electric System Operator, “The cost of planning, designing, constructing, operating and interconnecting a merchant intertie are not paid by Alberta ratepayers.”

Beneficiaries of the new line also include the Spanish firm Grupo NaturEner’s 189-megawatt Rim Rock wind farm located near Kevin, Montana.

Another beneficiary is Morgan Stanley Capital Group that has a power purchase agreement that includes pollution credits needed by San Diego Gas and Electric. In 2010, SDG&E petitioned the California Public Utilities Commission to invest in the Montana to Alberta Tie Line to comply with stringent green power mandates of AB 32, California’s Global Warming Solutions Act of 2006.

Subsidized “Free Market” 

Capital Power, based in Edmonton, Canada couldn’t economically build its originally proposed Halkirk Wind Farm without California pollution credits. Bryan DeNeve, senior vice-president of Enbridge, the private builder and operator of the new transmission line says this is a “whole new approach to Alberta’s free market.” He added:

“If consumers were forced to buy power from renewable sources, that would be a whole different approach to Alberta’s free market and we’d start to look like Ontario (with its Feed-in-Tariff) with its higher prices paid for wind energy.”

What DeNeve fails to mention is that this so-called “free market” is being subsidized by hydropower ratepayers in California’s Central Valley and electricity customers of San Diego Gas & Electric, who pay higher electricity rates. And to meet anti-pollution mandates, California’s regulated electric utilities are being forced to pay to clean up air pollution in places like Canada.

Air is cleaner in Canada but paid for by San Diego

By providing public financing to private merchant wind power and transmission line companies, Canadian-based Capital Power will be able to shut down 2,400 megawatts of older coal-fired power plants by 2021. However, the new wind farms will not entirely replace the old coal power plants, but will also require the construction of new gas-fired power plants for backup when the wind doesn’t blow.

McClintock and Hastings were joined by representatives of the Southwestern (hydro) Power Association, the Public Power Council of Portland, Oregon, Tri-State Generation and Transmission Association and the Redding (Calif.) Electric Utility, in criticizing the the Obama administration’s undermining of the long-time policy of “beneficiary pays.”   McClintock said:

“Families and businesses have paid for this resource with interest under the longstanding ‘beneficiaries pay’ principle.  The premise of this doctrine is that those who benefit must pay for their commensurate cost. That doctrine is being radically transformed under this Administration that seems intent on imposing costly mandates, regulations, fees and litigation that are making the monthly arrival of the family utility bill a growing financial nightmare.”

In 2012, ratepayers of SDG&E called for cutting back $600 million in the Rim Rock Wind Farm in Montana.  San Diego electric customers would not directly benefit from the wind farm Tie Line to Alberta, nor would air pollution be reduced in California.  San Diego would not actually get power from the Montana wind farm, but instead would get high-priced certificates so that it could continue to operate polluting power plants in its customer service area.

California’s 33 percent renewable energy mandate has been combined with Obama-controlled Federal Energy Regulatory Commission’s Order No. 1000 in a way that the California Global Warming Solutions Act of 2006 and the Federal Energy Policy Act of 2005 never intended.