CALIF GOES FOR 33% NEW ENERGY BY 2020

California OKs tougher renewables target
Sarah McBride (w/Carol Bishopric), September 23, 2010 (Reuters)

"California regulators voted…to boost the state's renewable energy target to 33 percent by 2020, which could provide a big boost to the alternative-energy industry in the nation's most populous state…But the goal, approved in a vote by California's Air Resources Board, faces significant challenges.

"Industry veterans say this goal is more achievable than a prior target of 20 percent by 2010, but will require faster approvals for plants and continued government help for developer financing…"

The stronger the New Energy requirement, the more the state's economy benefits. (click to enlarge)

"Hitting the increased objective - the highest in the nation - will require more investment in infrastructure and transmission, and a shorter lead time for projects…The approval process in California now takes years…Given the state of credit markets, financing for plants remains a major issue. Currently developers can tap into government help, but…developers complain about the slow pace of review for Department of Energy loan guarantees. And…[the popular] Treasury Department grant for up to 30 percent of the cost of renewable-energy projects…expires at the end of the year.

"Yet another question is whether the 33-percent regulation will even stay on the books. An initiative on November's ballot aims to overturn the law that authorizes regulators to create the 33 percent target…[And the] state's governor has the right to suspend provisions of the law, including the new target, for up to a year. Republican candidate Meg Whitman has said she would do this…"

The stronger the New Energy requirement, the more the state's economy benefits. (click to enlarge)

"Even if the regulation stands, utilities' track records on meeting their targets has been less than excellent. Pacific Gas & Electric and Southern California Edison each will end this year at 18 percent renewable energy…San Diego Gas and Electric, which was hit hard by transmission issues, will end the year at 14 percent…[To push them along,] California regulators have approved almost 2,000 megawatts of solar power…

"Problems with reaching the earlier 20-percent target included utilities signing contracts with alternative-power developers whose projects never acquired the necessary financing…Other projects turned out to be technologically impractical…or required new transmission lines that were not built. Now, the transmission issues are being resolved…"