Electricity Deregulation Blog

City to mull rate increase

 The Marshall City Commission is expected to deny a proposed rate increase of $74.98 million annually by Southwestern Electric Power Company during its regular meeting at 6 p.m. tonight in the commission chambers.

SWEPCO filed a statement of intent with the Public Utilities Commission of Texas on Aug. 28 to increase its annual revenue, which will “significantly increase rates for all customer classes,” according to documents provided with Thursday’s agenda.

The request would result in an average increase of $16 per month, or about 21.5 percent, for a residential customer in East Texas using 1,000 kilowatt-hours per month if approved as submitted, according to information provided by the company at the time of filing. The new rates could go into effect in the spring.

As they consider denying SWEPCO’s request, the city commissioners will also be joining a coalition of cities, Cities Advocating Reasonable Deregulation, which has a steering panel that provides “direction and guidance to lawyers who are representing said cities.”

The city has a regulatory authority under the Public Utility Regulatory Act, giving it “exclusive original jurisdiction over SWEPCO’s rates, operations and services within the city.”

The City of Marshall is required to take action on the proposed increase by or before Oct. 2, or SWEPCO’s application as filed will be deemed approved by law.

Commissioners will also:

Consider second reading of an ordinance to amend Chapter 14, Garbage, Trash and Weeds, to increase solid waste disposal charges by 2.2 percent, as provided for in the city’s agreement with Allied Waste Services.

Discuss the need for and status of improvements requested for Airport Park, drainage issues and needs, and the use of compressed natural gas fuel for some city vehicles.

Consider approval of the second quarter investment report.

As of June 30, the city’s portfolio was valued at $19,218,738.39. The city also earned $44,321.60 in interest income during the second quarter at a return rate of 0.873 percent with a year-to-date return rate of 1.035 percent, according to a memo from Finance Director Lisa P. Agnor.

Consider two rezoning requests.

Consider awarding a bid to provide an electronic marquee sign for the Marshall Civic Center.

Consider awarding a $533,769.23 contract for the 2009 street improvements project to Reynolds & Kay, Ltd., of Tyler.

Hear reports requested by Commissioner Zephaniah Timmins, including a cost comparison report for the fees of consulting engineering services versus the cost of employing a full-time engineer and a report on sediment washing into streets from construction sites.

Hear reports on various boards and committees, the status of stimulus projects, and TAC’s energy efficiency audit.

By TERRI HAHN

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Schwarzenegger Says He’ll Veto Renewable Portfolio Mandate

SAN FRANCISCO — California Gov. Arnold Schwarzenegger (R) has pledged to veto the 33 percent renewable portfolio standard passed by the California Legislature late last week.

A pair of renewable energy bills squeaked through the Statehouse late Friday, just before lawmakers adjourned their annual session. But the votes were met with immediate criticism from the governor, who believes the measures would unfairly limit out-of-state deliveries from wind, solar and geothermal energy sources.

“The poorly drafted, overly complex bills passed by the legislature are protectionist schemes that will kill the solar industry in California and drive prices up like the failed energy deregulation of the late 1990s,” Schwarzenegger spokesman Matt David said in a statement. “The bills as drafted will be vetoed by the governor.”

Schwarzenegger instead will pursue an executive order to implement what would be the most aggressive mandate in the United States, at 33 percent of total generation by 2020. His version of the RPS would attempt to permit more electricity imports from neighboring states and would likely proceed alongside a rule drafted independently of the Legislature by the California Public Utilities Commission.

The veto threat sets up a clash with environmentalists and many Democrats over their attempt to limit imports to ensure that renewable energy projects are built in-state. They argue that doing so would encourage more distributed generation and lessen the need for expensive power-line construction.

The bills that passed, from Sen. Joe Simitian (D) and Assemblyman Paul Krekorian (D), would build on the current 20-percent-by-2010 mandate, which applies only to the state’s big three investor-owned utilities. For the first time, California’s public power entities — including the sprawling Los Angeles Department of Water and Power — would be subject to the RPS under the measures.

The governor’s office and others have pointed out recently that one private utility, San Diego Gas & Electric Co., is currently getting about 6 percent of its power from renewable sources and is unlikely to meet the 2010 goal. SDG&E says it needs to access imports and build more transmission lines to meet its targets.

Other issues to be worked out on the RPS include how to count renewable energy credits and whether to establish interim benchmarks before 2020. Amendments were added in recent weeks on capping prices and cost containment (to address fears that a 33 percent goal would cause the cost of power to skyrocket) to win the support of the LADWP, the Western States Petroleum Association and others.

But those concessions were not enough to win the governor’s support, and it appears unlikely the Democrats have enough votes to overcome the veto.

Dan Adler, president of the California Clean Energy Fund, said he expects to hear more about the governor’s approach “early this week.”

Water package tanks

In another major development, Democrats in the Legislature decided late Friday that they did not have the votes to pass a comprehensive package of water bills. Last-minute negotiations over the package failed, prompting Democratic leaders to pull the bills before adjournment.

Discussions had centered on adding a water bond to the proposal to finance future levees, dams, reservoirs and canals. But the cost of that provision and a lack of consensus on how to craft it ultimately tanked the negotiations.

The collapse was another eleventh-hour defeat for environmentalists in Sacramento. Sources from the Environmental Defense Fund and the Nature Conservancy expressed disappointment but urged lawmakers to try again, perhaps in a special legislative session called specifically to address water supply issues.

“We must not lose sight of the fact that we are still in a dire situation,” said Anthony Saracino, water program director for the Nature Conservancy in California. “The status quo has led us to an impending disaster that threatens the ability for all Californians to thrive.”

The conference report that was pulled would have created a seven-member Delta Stewardship Council, a politically appointed panel that could push through new canals, levees and possibly dams outside the normal legislative process. The package also attempted to codify “coequal” water supply and ecosystem restoration goals that seek a delicate balance among fishing, farming and environmental interests.

But the package was dismissed by Republican lawmakers and Schwarzenegger aides who insisted it was meaningless without a water bond to fund projects like the proposed peripheral canal, which would theoretically shuttle water around the delta from the Sacramento Valley to farms in the south. Some environmentalists resisted a bond because they feared it would mean new dam construction; many groups instead favor efficiency, conservation and groundwater recycling measures.

Steve Evans, conservation director for Friends of the River, said the state does not have the money to finance a proposed $12.4 billion water bond.

By Colin Sullivan

 

Copyright 2009 E&E Publishing. All Rights Reserved.

 

 

Technorati Tags: California electric power

Schwarzenegger may order a change in green energy rules.

An order expected this week would require a third of energy to come from renewable resources — possibly with no limit on importing such power from other states. He may seek to include nuclear power.

By Marc Lifsher

Reporting from Sacramento

After vowing to veto this year’s biggest environmental bill, Gov. Arnold Schwarzenegger is expected to issue an executive order by midweek that would require all electric utilities to generate a third of their power from renewable resources, such as wind and solar power, by 2020.

The order presumably would set no limit on how much of the green power could be imported from other states.

Environmentalists who have been told about the governor’s still-evolving plans said Schwarzenegger also was considering directing the California Air Resources Board to look at broadening the state’s definition of renewable energy sources to include large hydroelectric dams and nuclear energy plants.

Critics questioned whether Schwarzenegger’s order would be binding once he leaves office at the end of 2010. The validity of the order would be subject to a variety of potential legal challenges, they predicted.

“I don’t think it will have nearly the effect that the bill would have, and I’m not quite sure it is legal,” said Senate President Pro Tem Darrell Steinberg (D-Sacramento).

A spokesman for the governor confirmed that he would sign the executive order sometime this week but declined to provide details.

On Saturday, hours after the end of the 2009 legislative session, Matt David, the governor’s communications director, said the governor would veto a pair of bills passed by the Legislature that would order electric utilities to get at least 33% of their power from renewable sources by 2020 — and with limits on how much could be imported from outside the state.

State law currently calls for generating 20% by 2010, a deadline that the utilities are unlikely to hit before 2013.

“The poorly drafted, overly complex bills passed by the Legislature are protectionist schemes that will kill the solar industry in California and drive prices up like the failed energy deregulation of the late 1990s,” David said.

The bills, SB 14 by Sen. Joe Simitian (D-Palo Alto) and AB 64 by Assemblyman Paul Krekorian (D-Burbank), were introduced this year to respond to a call from Schwarzenegger for legislative action to increase production of renewable energy in California.

The legislation was supported by environmental groups, consumer advocates, labor unions and some major utilities, including Pacific Gas & Electric Co., Sempra Energy and the Los Angeles Department of Water and Power. Raising the renewable energy requirement, they argued, would send a strong message to industry that California is serious about combating global warming, improving air quality and reducing reliance on foreign fossil fuels.

Unions and consumer groups also backed a provision in the bills that would require at least two-thirds of renewable energy be generated in-state to ensure that high-paying green jobs are created for California workers.

Among the opponents were the California Manufacturers & Technology Assn., the Independent Energy Producers Assn., the California Farm Bureau Federation and other business and trade organizations.

They feared that limiting California utilities’ use of energy credits in buying renewable energy from out-of-state generators would restrict electricity supplies and drive up prices.

Schwarzenegger, in a letter to lawmakers in May, said he opposed any limitations on imports of green power.

The governor’s order, which could be buttressed by a future bill, has sufficient legal teeth to get the Air Resources Board to write tough renewable standards under the authority of AB 32, California’s landmark law to curb global warming, said Jan Smutny-Jones, executive director of the Independent Energy Producers Assn.

“My sense is that a future governor most likely will support moving forward with this,” he said.

marc.lifsher@latimes.com

Copyright © 2009, The Los Angeles Times

 

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