Two new pieces of California legislation that target global warming solutions will go into effect Jan. 1, and already the impacts are being felt locally.
The Truckee Donner Public Utility District has proposed signing a 50-year contract to receive coal-powered energy from a power plant in Utah, but if the board doesn’t make a decision before the end of the year, the plan will be a wash because of Senate Bill 1368, which limits the term of coal and non-renewable energy contracts to no more than five years.
Without a long-term power contract, utility board members and staff say Truckee rate-payers will be at the mercy of the market and will have to pay nearly twice as much for power than if they purchased fixed-rate energy from the plant in Utah.
So while some see this new legislation as a positive environmental move, others say it won’t come without some setbacks.
In late September, Gov. Arnold Schwarzenegger signed AB 32, calling for the state to reduce emissions of carbon dioxide and other greenhouse gases by 25 percent by 2020, and by 80 percent by mid-century.
AB 32 requires the California Environmental Protection Agency to work with state agencies to implement a greenhouse gas emissions cap through regulations that would target California’s electric power, industrial and commercial sectors.
In California, two-thirds of greenhouse gas emissions come from transportation and energy production, and those sectors are the ones to be targeted, said Dan Kalb, California Policy Coordinator for the Union of Concerned Scientists.
This new law, which was co-authored by Fabian Nunez (D-46th district) and Fran Pavley (D-41st district) is the first of its kind in the nation and sets a precedent, proponents say.
Carbon dioxide is a substance released when fossil fuels are burned and is the most abundant of greenhouse gases. The gas will now be regulated in California, but is not regulated in other states such as Utah, where the Truckee Donner Public Utility District is looking to purchase coal-fired power, said Donna Kemp Spangler, public information officer for the Utah Department of Environmental Quality.
The new California legislation came about as the result of numerous reports on the consequences of climate change, and potential impacts in the state that include degradation of air quality and loss of Sierra snow pack, according to a brief published by Assembly Democrats.
But the trickle-down effect of industry upgrades and changes should be minimal to consumers, Kalb said.
“You just don’t know what’s going to happen economically,” Kalb said. “But we are getting closer to where the cost of renewables is almost the same as using fossil fuels. It may be best in the long-run for consumers both heath-wise and for their pocket books.”
Economic benefit could also come in the form of nearly 15,000 new jobs if a green-energy sector develops out of the new legislation, said Richard Stapler, press secretary for Speaker Nunez.
The governor has voiced his assurance of the bill’s value, and at a presentation in San Francisco prior to the election he said the emissions caps would spur new clean-technology businesses and that other states, perhaps even the federal government, would follow suit.
“The ultimate goal is to get the federal government to pass a similar strong law,” Kalb said. “Northeast states already have a compact to reduce greenhouse gases just from the electricity sector. If the larger states enact AB 32, that’s going to have more impact, and when enough states do it, the federal government will have to act.”
After signing Assembly Bill 32, the Global Warming Solutions Act, Schwarzenegger signed Senate Bill 1368, the Greenhouse Gas Emissions Performance Standard.
Senate President Pro-Tempore Don Perata (D-9th district) authored the bill, and said in a fact sheet published by the Union of Concerned Scientists that by passing the legislation, California can send a clear signal to energy markets and power plant developers: California’s adoption of greenhouse gas performance standards in the electricity sector will encourage the development of low-carbon technologies that meet the state’s clean energy policy, Perata stated.
Those low-carbon technologies could include burning agricultural produce for car fuel, and using wind, solar and biomass for other energy needs, said Peter Holzmeister, general manager of the Truckee Donner Public Utility District.
“They are trying to get people to stop burning natural gas, coal, oil and gasoline,” Holzmeister said. “They want to make sure that there are technologies out there to clean the emissions, and at some point ” a long way off ” they would like us to stop burning these things all together.”
Meanwhile, dozens of new coal-fired power plants are being constructed in western states such as Utah, New Mexico and Montana, and utilities that own or will own those plants, including a number in California, are hoping to sell that power to California consumers, according to a study released by the Center for Energy Efficiency and Renewable Technologies, a Sacramento nonprofit and two other environmental research groups.
The Truckee Donner Public Utility District is one such utility interested in purchasing out-of-state power to use within the local community.
When SB 1368 goes into effect on the first of the year, utilities will be limited in their ability to sign new contracts with such plants. Long-term financial investments in power plants that do not meet the new emission standards will be bound to terms of five years or fewer to encourage development of low-carbon technologies.
“It’s going to be expensive,” Holzmeister said. “We need to be reasonable and patient about some of this because the cost matters. We want to use electricity and we don’t want to go bankrupt, so there is a certain practical aspect of this that has to be recognized.”
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