As we detailed in prior commentary, almost two years ago, California Governor Jerry Brown signed Senate Bill (SB) 2 1X (2011), which increased California’s Renewables Portfolio Standard (RPS) to 33% by 2020. Among the features of SB 2 1X was the expansion of the RPS to cover publicly owned utilities or POUs.
Section 399.30 of the legislation authorized the California Energy Commission (CEC) to develop regulations specifying procedures for enforcement of the 33% RPS standard on POUs. The CEC held various public workshops to solicit initial comments on regulations last year, leading to the recent issuance of its proposed regulations along with a Notice of Proposed Action, which begins a formal rulemaking proceeding.
The proposed enforcement rules clarify, among other things, the CEC’s interpretation of what constitutes a renewable “electricity product” under SB 2 1X and sets forth the CEC’s interpretation of the three “portfolio content categories” established by the law. Under SB 2 1X, the majority of RPS procurement by both investor-owned utilities and POUs must come from resources that qualify to sell “Category 1” electricity products which include, for example, those sold from generation that has its first point of interconnection within the metered boundaries of a California balancing authority area, such as the balancing authority area for the California Independent System Operator.
The CEC’s draft regulations also require POUs to adopt a renewable resources procurement plan within 60 days of the effective date of the CEC’s regulations, and POU-specific programs detailing actions to be taken if the POU determines it will not meet its RPS procurement targets. The regulations further require POUs to file annual compliance reports, including information to document annual progress toward meeting RPS requirements.
Under the Notice of Proposed Action, the CEC has established a deadline of April 16, 2013, for the public to file written comments on the proposed regulations.