Energy Action Plan Greenhouse Gas Policy Activities / Update - PowerPoint PPT Presentation

Energy Action PlanGreenhouse Gas Policy Activities / Update

Julie Fitch

Director of Strategic Planning

California Public Utilities Commission

December 11, 2007

• Joint CPUC/CEC Greenhouse Gas Policy Proceeding Update
• Electricity Point of Regulation
• Natural Gas Options
• Allocation Issues
• Modeling
• University proposal for California Institute of Climate Solutions
• Other related CPUC proceedings/activities

Key questions:

• Will California electric sector participate in cap and trade?
• If so, who will have compliance obligation?

Four options:

• Load-based (load-serving entities/retail providers)
• Source-based (CA generators only)
• First seller (entity first to deliver to CA grid)
• Source-based for in-state; load-based for imports (“hybrid”)

Key dates:

• August 21 En Banc Hearing (parties filed comments August 6 and replies August 15)
• November 9 ruling asking additional questions on options
• December 3 and 17 final comments and replies from parties
• Mid-late-January 2008 – mail proposed decision for 30-day comment
• Late February 2008 – “Interim Decision” before both Commissions for final vote

Key questions:

• Should end-user emissions from natural gas combustion be capped (participate in cap and trade) or treated through mandatory/regulatory policies and programmatic strategies?
• Can we get more from the natural gas sector if we utilize cap and trade?
• Is there a relationship to electricity sector policy?

Two options:

• Cap emissions at local distribution company level (similar to load-based for electric)
• Address through programmatic strategies for energy efficiency and pipeline leak detection

Key dates:

• Initial comments from parties filed prior to prehearing conference – July 26 2007
• August 2 prehearing conference
• November 16 staff issued data request to gas market participants gathering data on sales by customer size/type
• November 28 ruling asking for further comments on key questions
• Comments due December 12, replies January 8
• Covered in “interim decision” on agendas in late February

Key questions:

• Are there particular allocation options that flow from different points of regulation?
• What is the most reasonable methodology for electricity and natural gas sectors, especially for consumers?
• How should methodology adjust over time?

Two main options:

• Auction
• Administrative allocation/distribution based on:
• Historical emissions
• Historical emissions intensity (emissions per MWh or therm)
• Sales (MWh or therms)
• Other (population, growth rates, etc.)

Key dates:

• First workshop May 22, 2007
• Additional workshop November 5
• Comments received October 31, replies November 14, supplemental replies December 7
• Preliminary conclusions included in “interim decision” on agendas in late February

Key questions:

• Quantity of emissions reductions available in electricity and natural gas sectors, at what cost?
• Availability of emissions reductions beyond existing efficiency and renewables policies

Two main initial conclusions (preliminary):

• Can get energy sectors back to proportional share of 1990 emissions with:
• Energy efficiency at unprecedented levels (around 100% of economic potential)
• Renewables at ~33% level
• Additional efficiency and renewables in other Western states
• Will not be free
• Likely rate increases on order of 30% average statewide by 2020

Key dates:

• Kickoff workshop September 21, 2007
• Initial results workshop November 14
• Parties comments and replies due January 4 and 18, 2008
• Second stage of analysis complete by April 2008, including:
• Refined cost estimates
• Analysis of impacts by utility/retail provider (implications for allocation policy)
• Further details of emissions reductions achievable by various strategies
• Also coordinating with ARB’s macroeconomic modeling

• Refinement of modeling analysis
• crucial to determining share of energy sector responsibility for overall 2020 goal adopted by ARB
• Emissions reductions possible
• Rate impact
• individual entity analysis required for equity determination
• Elaboration on allowance allocation policy (?)
• Flexible compliance options
• Includes controversial issue of offsets
• Banking, borrowing, compliance period definitions
• Final recommendation to ARB by no later than August 2008
• All design to fit into ARB’s “scoping plan” schedule (framework for all sectors) by end of 2008

• Proposal from network of universities:
• University of California
• Private universities
• California State Universities
• Community colleges
• Centralized hub to coordinate, fund, and disseminate research on climate change mitigation
• Would award grants via open, competitive, peer-reviewed process

• $60 million per year over 10 years
• Collected from electric and gas ratepayers
• Would use this as seed funding, allowing CICS to leverage additional state, federal, and private funding

• Develop Sustainable Energy Roadmap
• Fund primary research for gaps identified in Roadmap (avoid duplication)
• Fund education projects, including workforce development to train professionals and technicians
• Communicate/disseminate results through conferences, newsletters, etc.
• Suggested priorities:
• Buildings and homes
• Energy supply, sources and technologies
• Policy and management
• Climate forecasts and analysis
• Quality of life

Proceedings

• Long-term procurement planning proceeding
• Energy efficiency strategic planning
• Treatment of renewable energy certificates in RPS
• Sempra proposal for approval of certain early actions
• Edison proposal for Clean Hydrogen Power Generation demonstration plant

Activities

• Western Climate Initiative subcommittees
• Electricity
• Allocation
• Offsets
• Reporting
• California Climate Action Team subgroups
• Chair the Energy subgroup, participate in others