California's Unrealistic Renewable Energy Goal - Prop. 7

I work in the energy field and in public policy. I am a proponent of environmentally responsible energy planning and of responsible energy planning in general. I live in a state where the privately owned electric utilities are supposed to provide 20% of their power through renewable resources by 2010, and they have been scramling to reach that goal for the last few years. We are also in the process of looking at increasing the goal of how much of the energy consumed in this state and supplied through the power grid should come from renewable sources. And, given our environmental situation, our state's aggressive goals to reduce greenhouse gas emissions, and the reality that in general the power plants in California are aging, it is presumed we will set a much more aggressive goal than just 20% going forward.

But, how do we increase the amount of renewable energy? Do we just shoot for 50% renewable power by 2020 as California's Proposition 7 requires, or do we look at the big picture and plan our energy resources to meet all of the state's needs without overburdening the average energy consumer with a bloated bill?

The reality is, if Proposition 7 were to be passed in November, residential consumers would see massive increases in their per kilowatt (kW) usage rates over time. It takes time to get new plants up and running and for consumers to them absorb the impact of the costs of thenew generation, but when the new plants do go online and utilities are forced to urchase power to meet a 50% goal, every California energy consumer who remains on the grid and isn't entirely self-sufficent with their energy supply (meaning you have solar, fuel cell or other other source of power but you run it entirely on your own and don't rely on any electric provider as a back up when your source goes down or when it doesn't generate enough to meet your needs) - will feel the sting in their pocketbooks immediately and for the duration.

The reason is not just because renewable energy sources, like solar photovoltaic (solar PV), wind power, fuel cells, biomass (garbage to energy) or biogas (also called digester gas) often cost more to construct, site and produce and do so in much smaller quantities than say a nuclear or large natural gas plant powered by turbines or a large hydro-electric facility, but because the energy demand in California grows every year and because some renewable resources are not the best fit for providing a reliable source of around the clock resources. It may be cheap to buy wind energy at night, but you may need power between 2 and 6 p.m. on the hottest days of the year when peak demand is at its highest. So, even if you invest in a large amount of wind energy, if you are an electric provider that is required to meet reliability standards and have energy ready both off-peak and on-peak, you have to buy some other resource to back up your wind power for those hot afternoons when the wind doesn't blow and your provider can't deliver.

This scenario presents just two fo the complicated issues with energy planning in California. Electric providers, like your local gas and electric company, are also under strict greenhouse gas reduction plans. If they have to purchase more out of state coal resources or gas-fired resources as back ups to meet peak demand because wind is what is available to them to meet their 50% renewable goal - they aren't really reducing what we all now call their overall carbon footprint. They buy up 200 megawatts (mW) of wind from some developers subject toe the new mandate and they have to also purchase 200mW of backup power that we callpeaking resources to ensure they have adequate resources to meet demand during summer peaks. So, they are buying twice the power for the same time period and they are likely to also have to purchase some carbon offsets to pay for those back up resources that probably require quick start up and are higher emission. As an energy consumer I am not able to take advantage of the reality that wind is actually a reasonably cost effective source of energy, because during the peak, when I get home from work and my family is all assembled, my utility has had to buy wind and natural gas or wind and coal - and they've had to pay an offset. So, even if I am a good consumer and have a very efficient house, if I have to comsume ANY power durig that peak I am going to be paying significantly more for it than I would have paid absent a new 50% mandate.

Of course, utility companies are good at planning energy resources. They would not choose to purchase only wind when they know they might need some large scale solar (which is pretty expensive, but a good peaking resource if you can get it moved along your transmission grid from where it's generated to where it's needed for consumption. Fuel cells are pretty good sources of peaking power. They too are much more expensive than traditional sources of energy, especially for a utlity that may have large hydro and nuclear assets that can provide 2000 mW of power for less than 6 cents a kilowatthour (kWh), which is the basic unit of energy consumption. So today a utility may have 2000 mW of hydro and nuke power, 500mW of gas-fired power, 800 mW of wind, solar and biomass/biogas and fuel cells and it averages out to about 8 cents per kWh. Such a utlity would already have met and exceeded the 20% renewable goal (hydro power, though it comes from water, is not considered a renewable energy course in California if it comes from a large hydro plant). The environmental profile is also pretty good for such a mix of power and nuclear plants are low emitters, as are hydros - and a modern gas-fired plant can be very efficient. The renewable resources in this case are also very lo emitters.

Now say that same utlity has to meet the 50% goal and all this new renewable power is getting built in California. It takes a long time to build a power plant here - no matter what type of plant you want to build. People don't want giant solar fields ruining their views any more than they want cooling towers blocking the sun. And you pretty much have to site a large solar field out in the desert. And unless there's already sufficient transmission infrastructure already there, you have to build transmission out to get the solar power. If people didn't want to see solar field - they will hardly welcome new power lines. A few years tick by while all of this is getting worked out and the utility has been working with its customers to reduce demand, to encourage customers to build some on-site renewable energy, to improve their overall energy efficiency. Demand overall has still increased - but not as much as it would have absent the aggressive work of the utility and its customers. Under Prop. 7 the utility has to buy what is offered, with no cap on what is reasonable to charge them for the must-have renewable resource. The developer who built the huge solar field out in the desert has to recoup his costs of construction and delays so he sells his power at top dollar and the utility has to buy it because without that power the utilty can't meet the new goal and will face huge penalties. The utility gets 900mW of solar and has to buy 400mW of back up for winter power when solar is not the most efficient resource, and has to construct some new transmission to get to the solar. No one else is building solar because they can't compete with large solar providers so the utility has to buy all this power form this source and make the extra investment in transmission that takes a while to site and build. The utility has to buy some carbon offsets for that extra peaking power and now the per kWh cost is about 12 cents. Consumers who have reduced their demand, invested is more energy efficient appliances, insulation, solar panels for their pools and water heaters are now paying more money to consumer less power. Oh, and California is riddled with projects that aren't sited based on where the power needs are or where there is adequate transmission, but based upon where land was cheap to develop and where the deveopment could get done. It's also an issue of every utility for itself in the footrace to get all the power purchased to meet the new goal. The utilities retire a lot of very efficient gas-fired plant long before they had planned to do so because they have to compeltely shift their power mix. Communities that had relied upon good jobs at the clean gas plant for the next thirty years find the jobs disappeared after eight. And since the proposition doesn't really allow for re-powering of older plants to make them more efficient or to change resources mixes at the existing sites, early retirement makes the most sense. So, some communites have fossil-fuel plants that are literally fossils now - littering the landscape without producing energy or jobs, and others now have these huge solar fields and snaking transmission lines.

California can probably get to 50% or better renewable power in the next 20 years or so with adequate planning, adequate research and sufficient time and energy spent on meaningful demand reduction and resource planning within the context of reducing overall carbon emissions. There may be whole neighborhoods with solar roofs, parking lots will become shaded from mall to mall by new solar panels, and builders will build more efficient homes and retrofit older homes. Fuel cell technologies may advance quickly enough to provide some smaller scale applications, and with good regional planning current waste products, from waste water to landfill gases to cow manure throughout the state and within existing grids can be developed in regional and statewide plans to get the resources where they are needed by spending wisely, not just quickly. There are literally thousands of miles in California right under existing power lines where we could build storage facilities or parking lots and put solar on the roofs. Such medium-scale operations may help locate the resource not only closer to transmission resoruces, but also closer to where consumption is taking place. Wind resources can also be sited to meet demand needs best. Indeed. some very attractive renewable resources may be built in Nevada or Arizona or other nearby states where it makes sense to move the power into California without actually have to build the resource here, and visa versa with our beighbors. And if all of this is done correctly, existing plants will be upgraded to reduce emissions and some will be retired outright. But this will happen in a logical way looking at overall environmental needs, ongoing and forecasted demand for energy, existing transmission capacity and geographic resources and at the benefits of increased development of renewable energy resources. This will also be done within the context of California's current and changing economy, including looking at existing agricultural uses and demands, the hot valley, the cool coast - the remote mountains. City and agricultural waste can become energy where waste can be developed in an environmentally and economically sound manner - and much of California's agrarian wealth may be preserved and in accordance with greenhouse gas reduction policies so we don't buy two sources of power where we can buy only one and still provide reliable energy.

Or, we can look at a single solution to the problem, as Proposition 7 poses, with some very big winners (namely large solar power producers) and a very aggressive timetable that will mean much higher costs and lots of stranded investment, creating many more economic and environmental losers over time. The reality is, we have to move forward and we have to develop and bring on line more renewable power sources throughout this country. Huge, populous states like California face unique considerations when approaching the problem and so everyone involved in energy planning, supply and development should be involved in the process of determining how to move forward, and it should be done in the context of both responsible, reliable energy planning and of meeting long term environmental goals of reducing the state's carbon footprint. Proposition 7 will fall very far short of meeting those environmental goals and it will be an extremely costly way of shifting power resources and requiring utlities to purchase power from specific sources, to the detriment of the consumers who will pay ever higher energy bills.