Duane_ABA+NRE_2010_Greening+the+Grid+in+CA - Greening the...

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Published in Volume 25, Number 2, Fall 2010. © 2010 by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association. T he climate change policy debate has decisively shifted from “if” to “when” and “how” we should limit greenhouse gas (GHG) emissions. Nowhere does this shift have more profound ramifications than in the electric utility industry, which nationally accounts for 41 percent of carbon dioxide (CO 2 ) emissions from fossil- fuel combustion. Since the 1970s, California has been a bell- wether state in greening the grid. Climate change has made these efforts more urgent with passage of the California Global Warming Solutions Act of 2006 (AB 32), which requires statewide GHG emissions to be reduced to the equivalent of 1990 levels by the year 2020. C±L. HE±L²³ & S±FE²Y C´DE §§ 38550–38565 (West Supp. 2009). California’s approach to GHG emissions in the electricity sector is built like a three- legged stool: (1) improving energy efficiency through both state regulatory standards and demand-side management programs funded through utility ratepayer charges; (2) imple- menting renewable portfolio or energy standards, requiring utilities to purchase or generate a specified amount of their total electricity needs through qualifying renewable genera- tion sources; and (3) strategic investments in transmission to move renewable power from high resource value generation sites to demand centers with minimal social and environmen- tal impacts. This article summarizes the authority of key state agencies implementing these policies, the key lessons from California’s experience to date, and the key strategies these agencies are now pursuing in greening the grid to meet AB 32’s ambitious GHG emission-reduction goals. The California Air Resources Board (CARB) is the lead agency for implementing AB 32, but it must consult with the California Public Utilities Commission (CPUC) and the Cali- fornia µnergy Commission (CµC) on any energy-related aspects of AB 32 implementation. The CPUC and CµC have indepen- dent authority to consider the environmental impacts of those facilities and entities over which they have regulatory authority. In particular, CPUC regulates retail rates in the electricity, natural gas, telecommunications, water, and transportation sectors for Investor-Owned Utilities (IOUs). Its influence on GHG emission is primarily through economic incentives for the IOUs. Publicly Owned Utilities (POUs), in contrast, are not regulated by the CPUC. The CµC, unlike the CPUC, has no authority over the economic levers of electric regulatory policy. Instead, the CµC directly regulates the siting of major, nonnuclear thermal generating facilities in the state. The CµC
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This note was uploaded on 09/15/2011 for the course ENVS 100 taught by Professor Zavaleta,e during the Fall '08 term at UCSC.

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Duane_ABA+NRE_2010_Greening+the+Grid+in+CA - Greening the...

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