HomeMy WebLinkAbout11 Renewable Energy Resources Agenda Item #
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Public � District
To: Board of Directors '{
From: Stephen Hollabaugh
Date: November 14, 2003
Subject: Discussion of Renewable Energy Resources
Why this matter is before the Board — At the Board meeting of July 16,2003, Rolf
Godon presented the Board during public input a petition and letter concerning
"Renewable Energy Research and Production". The Board instructed staff to investigate
renewable resoureee and present it to the Board.
History — Staff has been investigating new resources as they present themselves. In
the past I referenced the possible Truckee Donner PUD Renewable Portfolio Standard.
I will discuss the draft of this Standard for the District. Also UAMPS has a Wind project
that is in a location that can be delivered to the District. I will discuss the District's
possible interest in this project along with an update on our WAPA allocation to start in
January 2005.
New Information—
Truckee Donner PUD Renewable Portfolio Standard
The State Senate Bill 1078 (SB1078
State Senate Bill 1078 (SB1078) was signed into law on September 12, 2002 and was
effective January 1, 2003. The legislation modifies the California Public Utilities Code to
include a specific renewable resource requirement for investor owned utilities (IOUs).
The legislation also includes provisions that apply to publicly owned utilities. These
provisions would include:
• Requirement that the governing body implement and enforce a renewable
portfolio standard to encourage renewable resources
• Requirement that publicly owned utilities report annually to their customers the
following
o The amount of money spent on renewables from public benefit funds
o The resource mix used to serve the customers (Truckee Donner Public
Utility District already publishes a quarterly notice)
r
• Each public utility governing board must define the terms of its RPS. The terms
would include:
o What qualifies as a renewable resource (i.e. whether or not to count large
hydroelectric projects (in excess of 30MW)
o The percentage of the total energy resources that are to be renewable
o The time frame in which to meet the "goal" of the defined standard
1 have put together a draft Truckee Donner Public Utility District Renewable
Portfolio Standard for the Board's review and possible acceptance.
UAMPS Wind Project:
UAMPS has a wind project located near Mona Substation in Utah near the Wyoming
border. UAMPS is asking its members about interest in this project. The project
consists of 83 windmills of 1.8MW each. The manufacturer of the wind units is GE and is
one of the most efficient wind projects avalilable. PPM is building and marketing the
project. An interest in the project would be a 20 year contract at about $48.11 per MW H.
The District would have to add some transmission charges to delever this to Gonder
Substation on the Sierra Pacific transmission system. UAMPS has transmission and
could deliver this power to us.
Research concerning Renewable Energy within the District-
Research shows that it takes a lot of land and wind for a economic wind generation site
and that none exist in the District's boundary.
The District has been selected for a small biomass project funded by the CPUC. I have
enclosed a number of documents from the consultant doing the studies on this project
which the title of:
Renewable Energy Research Program To Make Renewables Part of California's
Affordable and Diverse Public Power System
• Pre-Demonstration Summary Report
• Biomass DG Operating and Economic Characteristics
• Fabrication and Testing of 15KW Unit
Characterization and Development Report
Recommendation —
Consider bringing the Truckee Donner PUD Renewable Portfolio Standard
back as an action item for the Board's approval.
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7-17-03
TO: TDPUD Board of Directors
SUBJECT: A PROPOSAL FOR GIVING A 41 PRIORITY TO RENEWABLE ENERGY
RESEARCH AND PRODUCTION
I. Purpose
That the TDPUD board of directors; as representatives of the community; immediately
give renewable energy research and production the highest priority including an action plan as
proposed below.
II. Rationale
A. Energy"crises" created by outside energy producers.
1. Costing the district and subscribers huge amounts of money.
2. At mercy of outside producers.
B. State and Federal mandates for alternative energy production.
C. Efficacy of Local Control.
D. Subscriber interest(see attached petitions)
E. Advances in wind energy production technology and heightened interest and use
throughout the world. (See attached article)
III.Existing situation
A. Sierra Sun article(6-27) (see attached)
I. Mixed comments in terms of TDPUD support.
B. Biomass project underway.
IV. Proposal
We propose that the TDPUD Board immediately:
1. Make a unanimous commitment to locally generated energy utilizing the
renewable energy locally available.
2. Authorize a detailed local market assessment and research to determine more
fully the community's interest in renewables and to what degree the community is willing to
support TDPUD's involvement with renewables and to what extent they are willing to subsidize
renewable energy production and local control.
3. Immediately authorize the creation of a citizens committee to work with PUD
representatives to create and distribute an expanded and more detailed community assessment of
interest. This instrument could be attached to the monthly bill. Also, at the same time, move
ahead with creating a detailed proposal to have energy surveys professionally undertaken.
0: "CRUCKEE DONNER PUBLIC UTILITY DISTRICT
RE: DEVELOPIMENT OF RENEWABLE ENERGY RESOURCES
We the undersigned subscribers of TDPUD services ,hereby direct the agency, as a
public agency, to immediately proceed with research and development of renewable energy
resources, primarily for the production of electricity. These resources would be those utilizin
enei y from the sun, Ndnd and water for the production of electricity.
We would like to see a significant portion of local power(20%) be obtained from these
resources. Our power rates have increased significantly and will continue to do so as long as,ce
are de7endant on outside energy providers. The 3,4 million dollars recently spent to get out of an
enC11 y contract could have been utilized for significant progress in the development of the
afor.�ta'cd resources.
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i0: ` Rt'CKEE DONNER PUBLIC UTILITY DISTRICT
RE: l);iVELOPNIENT OF RENEWABLE ENERGY RESOURCES
We the undersigned subscribers of TDPUD services , hereby direct the agency, as a
public agency, to immediately proceed with research and development of renewable energy
resci:rces, primarily for the production of electricity. These resources would be those utilizin
enei c\ from the sun, wind and water for the production of electricity. g
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We would like to see a significant portion of local power (20%) be obtained from these
resources. Our power rates have increased significantly and will continue to do so as long as ,a e
a"e dcpcndant on outside energy providers. The$4 million dollars recently spent to get out of an
enurg- contract could have been utilized for significant progress in the development of the
2,Toe,tated resources.
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TO: rMuCKEE DONNER PUBLIC UTILITY DISTRICT
4E: 'DEVELOPMENT OP RENEWABLE ENERGY RESOURCES
We the undersigned subscribers of TDPUD services , hereby direct the agency, as a
public agency, to immediately proceed with research and development of renewable energy
resou-xs, primarily for the production of electricity. These resources would be those utilizina
enerp} from the sun, wind and water for the production of electricity.
We would like to see a significant portion of local power(20%) be obtained from these
resources. Our power rates have increased significantly and will continue to do so as long as we
re d:,pendant on outside energy providers. The'�4 million dollars recently spent to get out of an
merl_y contract could have been utilized for significant progress in the development of the
Zorestntted resources.
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TO: TRUCKEE DONNER PUBLIC UTILITY DISTRICT
RE: DEVELOPMENT OP RENEWABLE ENERGY RESOURCES
'JY'e the undersigned subscribers of TDPUD services , hereby direct the agency, as a
puhhl: agency, to inunediately proceed with research and development of renewable energy
rosocrces, primarily for the production of electricity. These resources would be those utilizinc
ener } from the sun, wind and water for the production of electricity.
V✓e would like to see a significant portion of local power (20%) be obtained from these
resources. Our power rates have increased significantly and will continue to do so as long as we
se de�;endant on outside energy providers. The 3�4 million dollars recently spent to get out of an
e�terf�� contract could have been utilized for significant progress in the development of the
afore�ia,ed resources.
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TO: TEtUCKEE DONNER PUBLIC UTILITY DISTRICT
P 1,: ''JEVELOPMENI'OF RENEWABLE ENERGY RESOURCES
We the undersigned subscribers of TDPUD services , hereby direct the agency, as a
Public agency, to immediately proceed with research and development of renewable energy
resources, primarily for the production of electricity. These resources would be those utilizing
enerf from the sun, wind and water for the production of electricity.
We would like to see a significant portion of local power(20%) be obtained from these
resources. Our poucr rates have increased significantly and will continue to do so as long as we
are dependant on outside energy providers. The 3,4 million dollars recently spent to get out of an
eiterpf contract could have been utilized for significant progress in the development of the
sloresrred resources.
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TO: z RUCKEE DONNER PUBLIC UTILITY DISTRICT
RE: [DEVELOPMENT OF RENEWABLE ENERGY RESOURCES
We the undersigned subscribers of TDPUD services , hereby direct the agency, as a
publ c agency, to immediately proceed with research and development of renewable energy
resources, primarily for the production of electricity. These resources would be those utilizing
energy from the sun, wind and water for the production of electricity.
We would like to see a significant portion of local power(20%) be obtained from these
resources. Our power rates have increased significantly and will continue to do so as long as we
are dependant on outside energy providers. The 34 milliondollaxs recently spent to get out of an
energy contract could have been utilized for significant progress in the development of the
aforestated resources.
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TO: "rRUCKEE DONNER PUBLIC UTILITY DISTRICT
RE: DEVELOP vIENT OF RENEWABLE ENERGY RESOURCES
We the undersigned subscribers of TDPUD services , hereby direct the agency, as a
publc agency, to immediately proceed with research and development of renewable energy
resources, primarily for the production of electricity. These resources would be those utilizing
enerz-' from the sun, wind and water for the production of electricity.
We would like to see a significant portion of local power(20%) be obtained from these
resources. Our power rates have increased significantly and will continue to do so as long as we
are dependant on outside energy providers. The 3,4 million dollars recently spent to get out of an
eneg:y contract could have been utilized for significant progress in the development of the
aforestated resources.
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and unreliable energy source,AEP and other major companies are cades of false starts and mechanical failures,a host of technology ad-
scramhiing to cash in on what is now the world's fastest-growing vanes and economies ofscale have dramatically improved wind
source e electric power.Multinationals like Shell and General Elec- energy's bottom line. The cost of producing a kilowatt-Foar of
_:'ic are investing hundreds of millions of dollars in wind operations electricity from wind has fallen by more than 80 percent since the
rom Washington state to Massachusetts. Last year, energy firms first wind farms were installed in California in the late 1970s.Today
spent a record S 1.7 billion on wind projects in the United States,in- the cost stands at between 3 and 6 cents per kilowatt-hoer,depenc-
creasing wind power capacity.by some 60 percent, to more than ing on location—comparable to or better than, in some cases, the
1,200 megawatts—enough to provide electricity to 1 million homes. standard 2 to 5 cents for conventional fuels.And with addition,
(By comparison,solar photovoltaic cells currently supply about200 momentum from state mandates—at least a dozen states now r,-
anegawatts.) "The big players who didn't give a hoot about this a quire utilities to get some of their energy from renewables—wind
ew ycnrs ago are firefly getting in the game,"says Ronald Lehr, a power is in the midst of a full-blown boom.
rortne-Colorado public utilities commissioner and a wind energy The biggest projects on the drawing board include South Dakc-
�Wen. `\Vhich is precisely what's needed to make wind a viable ta's Rolling Thunder wind farm, a massive 3,000-megawatt instai-
icnerg7 source." lation that, once it begins operation in 2006, is slated to generate
Even with the recent growth,wind power fills only about one- as much electricity as three average nuclear plants. A collection cf
mHof I percent of the country's total electricity demand;the Em farms in Washington and Oregon will add another 830 :mega-
ropean Union,with a total population only about one-third larger watts by 2003. Off the coast of Nantucket, Massachusetts. the
ham the United States, has four times as much wind power capaci- country's first offshore wind farm is slated to begin construction
ty and plans to obtain 22 percent of its electricity supply from re- next year; it is expected to generate 420 megawatts, enough to
newables by 2010. let a growing number of industry experts say displace two standard coal-fired plants.
It is the United States—with its And thoseprojeccs are just FF
huge e.ectricity market and its In the six years since Ben Givens started managing beginning. "If you look at this
i vast, windswept plains and wind farms in Texas,wind power has become the state's
fastest-growing source of electricity, country's huge wind resources
blustery coastlines—that has the
and the size clime energy market,
greatest uciential to reap power he economics could blocs u;
xrd pier"it from: wind. And right past what they'i-edone i_i
,lerhal snowhere is the trend Europe,"says[ehr 'In fivvpeara
more afparent than in Texas— or so, we could easlo be the
Zinc cornanyof the nation's oil or so,rld we coer n i easdind nere t
companies and their longtime
hampicn,George W Bush. t
= RIVE FROM ABILENE
It ww..s .lien-Governor Bush `;
into West i'exati rat-
who, un 1999,signed off on a e Hake court, an<'.
landre'rl provision requiring
Dit doesn't take long be-
ufdiries to get 2,000 megawatts fore AEP's Trent Mesa wind fart,_
of then, electricity from renew- comes into view.Even from 10
abler ity 2009, setting off the miles away,it makes for an ex-
largest annual increase in wind- traordinary sight: a long line o:
farm construction in U.S. his- 100 huge white pinwheels.. ead
1 tory. Aspresident, Bush has tallerthandicStatieofLibertc
existed calls to include a Simi" and with a rotor diameter longer
Lit provision in his national en- than the wingspan of a Boeing.
orgy p(a;n. But as the economics 747 Like a Christo sculpture
<•f w!.^,d improve,even Burin's blowing in the breeze,they spin
i nciti allies point to Texas with an almost artistic subtleny.
as prop'that,with just a little even in the stiffest gases, the,:
push from the government, re- make but one gentle ievolu-
cewabics can compete. °C{/iud lien every two to three seconds.
1-ower is an increasingly viable That's still plenty to generate 1.�
source el power generation," megawatts each, more than, a;-
i says James Houck, head of the most any other wind turbinenoss
i power and gasification division operating in tee United States-
: , � �
at ChevronTexaco,which plans `i' 1' la' {�r
j p °Wegeta lot ofsightseerswho
to builc its first wind farm this ¢; d drive up and -vanta tour.'Ben
i }ear. Givens says as he steers his three-
The reason for Big Energy's I
I quarter-ton truck up a dirt roar.
t,unarouind is simple: After de- that winds to the top of the me-
at) F101r!ER JOFES 1Uiv/rtIJGUST 1002
PREVAILING WINOS
"The big players who didn't give a hoot about this a few years
ago are finally getting in the game," says wind expert Ronald Lehr.
"Which is precisely what's needed to make wind a viable energy source."
sa. "people just`ooh'and`ahh'the closer they get to them,espe- His phone rang,off the hook last year when natural gas pricesI f
ciahy the little kids.If we ever went belly up, heaven forbid, we spiked."People in the energy business want predictability,and you II
could always make a tourist attraction out of this place-° can get that now with wind."
It's easy to see why visitors are intrigued.Givens,an affable West 1G ENERGY'S SURGE OF tNTERP.ST in wind power has i
Texas native who is the plant's operations manager, rattles off a
suing of impressive facts:The towers'foundations take up a mere been a longtime coming.Aldroug}rsome large companies
ese
150 square feet of ground, but their rotors sweep an area nearly enern rcris is,fed e development
g all bunt drirts edrup during ting the o e
twice the size of the mainsail on a large clipper ship.Perched atop gY
each tower is a rectangular box the size of a school bus that contains Reagan and Bush years,and the United States'technology lead was
56 tons of power equipment.Sensors send streams of data to a cen- lost to firms:,from Europe.
tral server that helps fine-tune the turbines'operations and directs a The U.S. ive until the 1990s,at
-
operations industry didn't begin to rev
red a wind
cre
the
artment
ter
ss crea
total of about 590,000 megawatt-hours'worth of electricity;enough of Energy a program t fi tax
nce the development opment of new
to power about 35,000 homes,to a nearby substation, ,
As we arrive at the base of one tower,we have to crane our necks turbines;An enterprising team at a Texas utility called Central and
to see the top of the structure,where we can just make out the now South West Corp.was the first to take advantage of the avnds and
notorious tilted E.Enron was an early player in the revival of wind soon set up a dozen experimental turbines on a remote farm near
,was Cent al and South
energy;one of its most profitable subsidiaries, Enron Wind,sup- Fort Davis,Texas.Walker,the AEP executive
he turbines for Trent Mesa and developed about one-third West's research director at the time."We had all kinds of problems
plied all
of the 900 megawatts of wind power that came online in Texas last at first,"he recalls."When it got too windy,some of the parts would
year. When the company was sold after Enron's demise,AEP and break and fly off.Then there was the lightning storms—things sta -
bile its turbine-manufacturing g neratorsgptdedEd ju ti the trial by fire the idustry
the
nand
burned-out
others snapped up its wind farms,w nleded.The
operations went to General Electric.
Givens opens a porthole-shaped door on one of the towers and company that built those turbines, a startup called Loud Energy
walks inside.A steel ladder leads upward through the darkness;at its Systems;later became Enron Wind.
base, a computer console keeps track of the turbine's operations. To gauge whether the market was ready for wind, Walker area-
When he started work at one of Texas'first wind farms six years ago, nized a series of"deliberative polls," town hall-style meetings held
Givens recalls, state-of--the-art turbines put out 550 kilowatts each. in three Texas cities in 1997, at which customers could learn about
"These new machines can do three times that," he notes,"and for o tie pollsew ,renewables came ogy and rank irnrfirst or second;energy
only conservation
about half the cost per kilowatt-hour."
The new generation of wind turbines aren't just bigger than their was more popular. "None of us realized how much people would
predecessors;they're more reliable,easier to maintain,and better at support the idea,"recalls Walker."It really turned the heads of our
ular. management."Walker was soon given the go-ahead like
develop the
adapting to changing wind conditions.And they're more pop
Though some wind projects have been criticized for marring the company's first commercial wind farm Sett rig out like wildcatters
landscape and posing hazards to migrating birds, most environ- in search of an oil patch, he and his team fanned out across West
mentalis s strongly support the technology. Here in West Texas, Texas,scouting favorable locations in hopes of striking meteorclog-
Trent Mesa has brought more than a dozen permanent jobs and a ical pay dirt.They eventually settled on a pa of high mesas and be- l
tring aElucrative land leases for area ranchers. "The taxes alone are gan erecting the Trent Mesa turbines.
making a big difference for the schools and hospitals here," says By 1999,Texas legislators were taking note.As part of a bill clereg-
G'.enn Wortham, a city commissioner in nearby Sweetwater. "This vocacy groups Gke public Citizen s energy market, and the Et v onmenalfDelerom mc I
has been a win-win situation,"
While such praise makes for great P.R.,it's the bottom line that's Fund—crafted a provision requiring that power companies get at
driving big investments in wind.Richard Walker,AEP's director of least 2,000 watts,or approximately 3 percent of their power,from re-
est such mandate in till
renewable energy business development,says company executives newable souhrees by 9 was strongly. It was the re by most of the ntili >
are especially enthusiastic about wind power's ability to deliver elec- country."[T provision] lt
triciry at a stable price. "You can give them a firm number for 20 ties,"says Steve Wolens,a Democrat and the bill's co-author m the
c years,°he notes,"which is something you can't do with natural gas." state House.`But it was the right thing to do.And in die Tong run,
_ I ULYIAUGUSr 2002 MO in Ea 10 N[5 41
BEYONDTHE FRINGE ` .
It's not just Wind.Renewable subsidize the technology,and in 2005.Nearly 65o,000 geothermal . e
energy technologies such as solar remote places far from the electric systems have been installed
panels,geothermal pumps,and grid,especially in the developing around the nation,according to
hydrogen fuel cells—long world.But now,some U.S.utilities the industry-government
dismissed as costly,whole4arthy and government agencies are Geothermal Heat Pump
fantasies bythe Dick Cheneys beginning to offertheir own Consortium—saving the equiv-
of the world—have quietly incentives.In New York and alent of some E4 million barrels of
been going mainstream.Some, California,subsidies can pay for up oil annually. SOLAR PANELS COULD BEAT'HE LOST
particularly photovoltaic solar to half the cost of a photovoltaic And then there are fuel cells, or CONVENTIONAL ENERGY By THE END
OFTHEDECADE.
cells,have nearly reached the system large enough to power perhaps the Holy Grail of
tipping point at which they can ahouse—typically between alternative energy.Fuel cells, whose largest shareholders
match or beat the cost of $zo,000 and$30,000.Similar,if which operate much like batteries, are Ford and DaimlerChrysler,is
conventional sources;others, less generous,programs are also in produce power from pure already producing fue-cell buses
including fuel cells,are drawing place in Maryland,Arizona,Florida, hydrogen or from hydrogen-rich for use in Europe and California.
multimillion-dollar investments Washington,and other states. fuels such as natural gas, For now,most fuel cells are
from major companies hungry Geothermal technology,which methanol,and even gasoline. finding their way into generators
ti for an alternative to fossil fuels. uses the constant temperature Quiet,extremely energy-efficient, and small power plants that can
The cost of solar-powered of the earth to heat and cool and,in many cases,completely provide dean,stable e!ectnaty
energy,for instance,has dropped buildings,may already have pollution-free,they promise to independent of the grid.The
more than Be percent since 1982, reached its tipping point.In 1992, revolutionize the production of - Conde Nast building on New
from$27 to$4 perwatt,and New Jersey's Richard Stockton energy in everything from the - York's Times Square supplements
some experts say(twill reach$E— College built the world's largest family carto homes,shops, its power supply with two roof-
about the cost of coal-fueled "closed loop"geothermal and factories. top fuel cells;the starwood
- electricity—by the end of the installation to replace an obsolete Mass production of fuel-cell cars Hotels chain is installing tennis-
decade.And solar installations, heating and cooling system. isn't expected until the end of the court-size fuel-cell generators
while still a tiny fraction of world According to Stockton physicist decade.But Ballard Power Systems, at two of its Sheraton hotels
energy production,are growing Lynn Stiles,the system reduced aVancouver-based company in New Jersey;and Caterpillar Inc.
fast:While it took nearly three peak electric demand by nearly a recently announced plans to sell
decades—until t9gg—for the million watts and will have saved FUEL-CELL BUSES THAT RUN fuel-cell units side by side with
industry to produce its first billion the college roughly$i million by ON HYDROGEN ARE BEING its big diesel backup generators.
watts worldwide,solar is expected ROAD-TESTED IN CALIFORNIA. Welceselbacku generator
to hit the 2-billion-watt mark as - -.
j though,is that the hydrogen to
early as next year.Making ` run them.will ultimately be
photovoltaic solar panels has b;;��Lr fl.
become profitable enough to 'Lwv �14t, ' sl Produced net from natural gas
but from water,using electricity
attract big energy and technology t?%' �E'�NChaBsi CRnU -.t from solar cells,wind farms,and
companies:Once dominated bystart � Elf 4 ^ other renewable sources,Once ..
controlled
industry i now _ y -. widely available,thistechnology ,
controlled by multinational giants xL- would solve clean power's last
such as Shell,BP,and Mitsubishi. c�` major dilemma—how to stole
Momeinst of countries
so far7J C:IN energy when the sun doesn't
has come in countries like Japan (',Ir' " shine or the wind won't blow.—
a and Germany that aggressively x on R.tuoma
it was a booming success because the utilities finally realized they the commission directed countries to draw at least 12 percent of
could make money with wind." their energy from renewable sources within the next eight veari.The
law has sparked It wind-farm construction boom that is set[o p ace
ws BQmxwe PowBx COMPANIES to get some po ion thousands of supersize turbines throughout the con-inent and oI.,
of their energy—typically between 3 and 8 percent—from re- the coasts of the United-Kingdom, Denmark,and Gema:[z-
irewables are now on the books in a dozen states,including Europe's aggressive approach is a result,in large part,of the E.u-
A Pennsylvania,New Jersey,Wisconsin,and Arizona.The man- ropean Union's commitment to the United Nations' Kyoto P:oto- 4
dates are widely credited with pushing wind to the top of the indus- col,which calls for reducing production of greenhouse uses. "The F try's agenda.Yet they pale in comparison to a measure passed by the climate Change thing is driving it here,"says)ohn Doddrell,director
European Commission last year: Looking, in part,to Texas'legisla- of sustainable energy policy for Britain's Deuartment of Trade and
Lion es a model for creating market-based wind energyincentives, Indus s
try, which is distributing $380 million m capital grants 3
i
l 42 at O'r H ER JONES I IULYIIUG UST 200E
4
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PREI II.'N6 WINDS
I_
one recent report estimates that,together with other renewable sources, II
wind could supply a full zo percent of the nation's electricity needs r
while actually reducing the average price consumers pay.
j
f
for renewable energy projects. "There's a growing recognition from those sources by 2020.Like the Texas legislation,the bill easo I
of the seriousness of the problem and that we need to reduce creates a credit trading system to help power companies meet the
energy we do use from new requirement."Utilities that aren't in wind-richareas could buy
consumption of energy and obtain the
cleaner, renewable sources." credits from those where the wind is plentiful,"notes Lela,the for-
The Bush administration,which last year pulled out of the met Colorado utilities commissioner,"which helps solve some of [
international negotiations that produced the Kyoto agreement, the geographic constraints that power ge orator f ace" Thed il`'s 6
st
has refused to take a similarly { year,has no such provision.
active role to promote renew- Whether or not the measure
ables.Though Bush recently ulrimately becomes law,the idea
revived the wi;id energy tax cred-
,` has attracted some high-powered ,
it, his energy plan includes no backers."The federal govan-
national mandates for renewa- "`
:. -__ ..fig merit can set policy guide.ines
tiles and instead looks largely to and then let the free mark t de-
coal,oil, and nuclear power to Bide how they're achieved," says
feed the nation's future energy Robert Gates, senior vice p esi-
de:namd. dent of development for Ge ner-
Of course, wind alone could ' al Electric's new wind energy j
never fully supplant those - division."We did the same thing
sources.While the fuel is essen- with catalytic converters. We
Bally free, the vagaries of the decided to make the oir cleaner-
weather don't guarantee enough But we didn't real companies
wind to keep the lights on 24/7. how to do it—just that they had
Moreover,while wind resources to."A national renewables man-
in places like Texas,North Da- date,Gates adds,would prompt
kota, and Kansas—the nations offshore wind farms like this one near Copenhagen are companies like G.E. to pump .Ill
three windiest states—are abun- expected to help the European Union generate is percent
of its electricity from renewables by lino' more money into wind and oth-
dant,they tend to be far from the er renewable technologies,bring-
population centers that most
need Power,and transmission lines lose a great deal of elect ricity biggest v nd turbines evere cost even r,,"lie notes. "And we're doing that pre
over long distances.
Still,the nation's wind resources are vast.According to Depart- marily to meet the growing demand in Europe."
ment of Energy estimates, those same three windiest states could Futurists also envision a day when wind power can be used to
meet the nation's entire electricity demand.With improvements to electrolyze water to produce hydrogen,which can s=rv:as a fue'for
the transmission system, "there's absolutely no doubt that wind everything from cars to generators."We can now see a future where
could supply at least 10 percent of the country's electric power," farmers and ranchers can supply not only much of the country's
says Randall Swisher, executive director of the American Wind electricity,but much of the hydrogen to heel its fleet of automobiles
Energy Association,an industry rewash and trade group."And it as well,"predicts Lester Brown, president of the Earth Policy Instr
could do it without raising electricity rates."A recent report by the lute."For the first time,the United States has the technology to di-
Union of Concerned Scientists estimated that,together with other voice itself from Middle Eastern oil."
renewable sources,wind could supply a full 20 percent of the na- Of course, Brown and other environmentalists have been mak-
tion's electricity needs while actually reducing the average price ing grand predictions about wind for decades,only to have their
consumers ideas undermined as falling energy prices and the resulting lack of
co pay.
nsumers energywoutdgetamodest boost under the energy bill investment rendered alternative technologies unprofitable. But
Renewabpassed by the Senate in April.The measure requires companies to with the economic winds finally blowing in their favor,renewables
get at feast 1 percent oftheir power from renewable sources by 2005, proponents now sound less like Don Qu xotes than like rational,
and it sets a goal of generating 10 percent of the naaon's electnary forward-Looking businesspeople.■
wrxia Ue UST 20" Mon HrR joN 1.; 43
b
Renewable Portfolio Standard (RPS) Page 1
UC E DONNER
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PublicDistrict
Truckee Donner PUD Renewable Portfolio Standard
PURPOSE:
TDPUD's policy regarding 2002 SB1078—Renewable Portfolio Standard(RPS).
BACKGROUND:
State Senate Bill 1078 (SBI078) was signed into law on September 12, 2002 and was effective January 1,
2003. The legislation modifies the California Public Utilities Code to include a specific renewable
resource requirement for investor owned utilities (IOUs). The legislation also includes provisions that
apply to publicly owned utilities. These provisions would include:
• Requirement that the governing body implement and enforce a renewable portfolio standard to
encourage renewable resources
• Requirement that publicly owned utilities report annually to their customers the following
o The amount of money spent on renewables from public benefit funds
o The resource mix used to serve the customers (Truckee Donner Public Utility District
already publishes a quarterly notice)
• Each public utility governing board must define the terms of its RPS. The terms would include:
o What qualifies as a renewable resource (i.e. whether or not to count large hydroelectric
projects (in excess of 30MW)
o The percentage of the total energy resources that are to be renewable
o The time frame in which to meet the"goal"of the defined standard
Discussion-points:
1. Although excluded for the purposes of the IOU's requirements under S131078, TDPUD's future
share in"large" hydroelectric projects is a valuable and critical component of the energy needs of
the community. TDPUD's allocation of the Western Area Power Administration (WAPA) starts
on January 1, 2005. This power is under a long term contract with the Department of Energy's
Western Area Power Administration (WAPA). Much of this power is generated at Shasta,
Folsom and New Melons Dams. None of these dams meet the CPUC's eligibility requirements
for IOU's. However, due to the nature of the management of these facilities by the Federal
Government for power, reclamation and environmental concerns, staff believes that a separation
of large and small hydroelectric projects at a 30 MW level is arbitrary and ignores the unique
nature of the resources provided by WAPA and the Department of Interior's Bureau of
s
Renewable Portfolio Standard RPS
Pa tie 2 '
tility District will include all hydroelectric regardless of
Reclamation. Truckee Donner Public U
size and location as meeting the District's renewable portfolio standard.
2. The District's location in the Sierra Pacific Power transmission control area differs from all of
s
the other publically-owned utilities in California. TDPUD is a transmission dependent utility r
4
(TDU) electrically internal to Sierra Pacific Power's control area. The interconnection points to
ummit Intertie (to CAISO), Alturas Line (to near COB),
Sierra Pacific Power's control area are S
Gunder Substation near Utah (this is the current location of our existing contract deliveries and
includes the Pacific Corp and LADWP control areas), and Midpoint Substation (to Idaho Power).
This transmission configuration must be taken into account when trying to identify future
renewable resources.
3. TDPUD is currently participating in a State grant-funded evaluation of the potential of CA's
public utilities using renewable energy resources in California. Our participation in this project is
to assist in evaluating the feasibility of using biomass electric generation in Truckee. There will
be a 15 KW biomass demonstration plant installed in Truckee in the Spring of 2004. There will
also be a feasibility study conducted to determine the potential value and economics of siting a 3-
4 MW biomass plant in Truckee.
POLICY:
The renewable portfolio standard of the Truckee Donner PUD will be as follows:
• Qualifying PPS resources are defined as non-fossil fueled electric generating
resources, including all hydroelectric resources:
o Geothermal including low-temperature(geothermal heat pumps)
o Hydroelectric
o Solar
o Wind
o Biomass and waste
o Fuel cells
• RPS Target:
o At such time that projected resources do not exceed projected demand, TDPUD will
strive to include qualifying resources to meet projected demand.
o Any purchase or construction of qualifying resources will be accomplished primarily
with accumulated public benefit funds. Due to the expected magnitude of incremental
resource requirements it is highly unlikely that TDPUD can secure qualifying resources
at reasonable rates (i.e. 100 kw of demand is a very small unit of delivery). There is a
potential within NCPA or UAMPS that TDPUD will be able to obtain a percentage
ownership in a qualifying facility but probably not at the time that the projected
resources are required.
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Renewable Portfolio Standard (RPS) Policy
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r.
Strategies for meeting RPS objectives:
o TDPUD has implemented solar PV and geothermal heat pump demonstration projects
utilizing public benefit funds. Housing stock is expected to increase 25% in the next 10
years. Demonstration and production solar and geothermal projects installed at a number
of new homes will provide RPS qualifying resources.
o TDPUD organizes an annual tour of energy-smart solar homes which results in the
installation in new small-scale renewable energy systems every year.
o Public benefit funds, when available, will be used to implement the demonstration
projects and may be used to supplement the production projects.
Reporting RPS performance
o TDPUD will continue to report to its customers the annual power content label.
o TDPUD will report the amount of public benefit funds expended for the development of
qualifying RPS resources in conjunction with the annual power content label reporting
s
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STANDARD FOR LOCAL PUBLICALY OWNED ELECTRIC
UTILITY
The Legislature recognized that there are large differences among municipal utility
service territories and that these differences may require different responses to the public
policy goals of SB 1078. As such, the Legislature has afforded publicly owned utilities a
great deal of discretion for deternrining how to devise and implement a Renewable
Portfolio Standard that meets the unique needs of each municipal utility service territory.
With this in mind,the mandate for municipal electric utilities from SB1078 is as follows:
Public Utilities Code(PUC) Section 387:
(a) Each governing body of a local publicly owned electric utility, as defined in Section
9604, shall be responsible for implementing and enforcing a renewables portfolio
standard that recognizes the intent of the Legislature to encourage renewable
resources, while taking into consideration the effect of the standard on rates,
reliability, and financial resources and the goal of environmental improvement.
(b)Each local publicly owned electric utility shall report, on an annual basis, to its
customers, the following:
(1) Expenditures of public goods funds collected pursuant to Section 385 for
renewable energy resource development. Reports shall contain a description of
programs, expenditures, and expected or actual results.
(2) The resource mix used to serve its customers by fuel type. Reports shall contain
the contribution of each type of renewable energy resource with separate
categories for those fuels considered eligible renewable energy resources as
defined by Section 399.12.
Municipal electric utilities are not required to adopt any particular percentage goal for
renewables, nor are they required to favor any particular technologies. Rather, they are
only required to adopt and enforce a renewable standard that makes sense for their
service territory, and their customers, and report annually the results achieved by those
expenditures and programs.
As long as municipal electric utilities document their reasons supporting the adoption of
their particular renewable portfolio standard, programs, and expenditures, and that
reasoning is supported by the needs of their service territory, then they should be
considered in compliance with the law.
The statute does not have a firm compliance date for municipal utilities. However, the
statute does require annual reporting to customers, therefore it may be prudent for
municipal utilities to establish a renewable portfolio standard within a reasonable period
of time from the January 1, 2003 effective date.
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QUALIFIED RENEWABLE RESOURCES
SB 1078 leaves it to each municipal electric utility to define "renewable resources" on its
own terms, including where such resources will be located. That said, SB1078 does
define "renewable resources" with respect to IOUs, and this definition can be used as a
guide by municipal electric utilities in development of an RPS Label.
Location: In-State v. Regional
Under SB1078 municipal utilities are not restricted to in-State renewable resources, and
there is no explicit language stating that a renewable resource located in the Western
region would provide less environmental benefits as a resource located in California since
the environment does not have strict boundaries. The Western electric grid interconnects
14 states, Southwest Canada, and Northern Mexico, therefore a renewable resource
located anywhere in the Western region would offset the same amount of fossil fuel
generation in the region. Municipal utilities are only obligated by the statute to "develop
an RPS that recognizes the intent of the Legislature to encourage renewable resources,"
and the location of the renewable resources not specified and left to the discretion of the
local authorities.
Lar re Hvdroelectric Resources
Many municipal utilities have a substantial amount of hydro energy as part of their
current energy mix. Hydro energy is clearly renewable, but there are mixed views
regarding "large' hydro as a renewable resource because of the water diversion effects on
habitats. While this may be a plausible argument against new large hydro, a municipal
utility could argue that existing large hydro should be considered part of its baseline
renewable energy contributing toward an overall portfolio target. The difference of
opinion regarding large hydro is illustrated by the comparison of state definitions of
renewable energy shown in Appendix B. Out of the 21 states that have established
definitions for renewable resources, 10 states have no restrictions on defining hydro as a
renewable resource, 4 have size limits (i.e. <30 MW, <60 MW, <100 MW, low-head
hydro), 4 states don't recognize hydro as renewable, and 3 refer to other environmental
restrictions on the use of hydro without regard to size.
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