Wednesday, March 27, 2013

California Renewables Portfolio Standard (RPS)

Established in 2002 under Senate Bill 1078, accelerated in 2006 under Senate Bill 107 and expanded in 2011 under Senate Bill 2, California's Renewables Portfolio Standard (RPS) is one of the most ambitious renewable energy standards in the country. The RPS program requires investor-owned utilities, electric service providers, and community choice aggregators to increase procurement from eligible renewable energy resources to 33% of total procurement by 2020.

The California Public Utilities Commission (CPUC) and the California Energy Commission jointly implement the RPS program. The CPUC's responsibilities include:
  1. Determining annual procurement targets and enforcing compliance.
  2. Reviewing and approving each IOU's renewable energy procurement plan.
  3. Reviewing IOU contracts for RPS-eligible energy.
  4. Establishing the standard terms and conditions used by IOUs in their contracts for eligible renewable energy.
The original RPS legislation assigned the Energy Commission with the following responsibilities:

  • Certify renewable facilities as eligible for the RPS.
  • Design and implement a tracking and verification system to ensure that renewable energy output is counted only once for the purpose of the RPS and for verifying retail product claims in California or other states.
Senate Bill X1-2 increased the Energy Commission's role with responsibilities specific to publicly owned utilities:
  • Directs the Energy Commission to adopt regulations specifying procedures for enforcement of the RPS for publicly owned utilities.
  • Requires the Energy Commission to certify and verify eligible renewable energy resources procured by publicly owned utilities and to monitor their compliance with the RPS. The Energy Commission will continue to certify and verify RPS procurements by retail sellers.
  • The Energy Commission refers the failure of a publicly owned utility to comply to the Air Resources Board, which may impose penalties.
Subsequent recommendations in California energy policy reports advocated a goal of 33 percent by 2020, and on November 17, 2008, Governor Arnold Schwarzenegger signed Executive Order S-14-08 requiring that "...[a]ll retail sellers of electricity shall serve 33 percent of their load with renewable energy by 2020." The following year, Executive Order S-21-09 directed the California Air Resources Board, under its Assembly Bill 32 authority, to enact regulations to achieve the goal of 33 percent renewables by 2020.

In the ongoing effort to codify the ambitious 33 percent by 2020 goal, Senate Bill X1-2 was signed by Governor Edmund G. Brown, Jr., in April 2011. This new RPS preempts the California Air Resources Boards' 33 percent Renewable Electricity Standard and applies to all electricity retailers in the state including publicly owned utilities (POUs), investor-owned utilities, electricity service providers, and community choice aggregators. All of these entities must adopt the new RPS goals of 20 percent of retails sales from renewables by the end of 2013, 25 percent by the end of 2016, and the 33 percent requirement being met by the end of 2020. (California Public Utilities Commission, California Energy Commission)

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