Date: September 15, 2009
Source: News Room
Advancing California's commitment to reducing greenhouse gas emissions and increasing the state's renewable energy, Governor Arnold Schwarzenegger today signed an Executive Order (EO) directing the California Air Resources Board (CARB) to adopt regulations increasing California's Renewable Portfolio Standard (RPS) to 33 percent by 2020 - first established by the Governor's directive last year. The Governor's EO upholds California's leadership in environmental policies and builds on AB 32 goals by ensuring California will have the flexibility needed to use renewable energy sources for 33 percent of our state's energy consumption by 2020. Today's action will provide clear, permanent direction for creation, delivery and servicing of California's renewable energy projects, which will help avoid another energy crisis while achieving our renewable energy goals.
"Three years ago, I signed AB 32 and committed California to roll back our greenhouse gas emissions a nation-leading 25 percent by 2020. We've made a lot of progress since then, but we still have a lot of work to do to reach our goals," said Governor Schwarzenegger. "So I am taking action today to make sure California remains a pioneer in clean energy and clean jobs and directing the California Air Resources Board to enact regulations to reach our 33 percent renewable energy standards by 2020. With this investment in renewable energy projects, California has a bright energy future ahead that will help us fight climate change while driving our state's green economy."
The Governor's order places the highest priority on renewable resources that will provide the greatest environmental benefits that can be developed quickly and support reliable, efficient and cost-effective electricity system operations including resources and facilities located throughout the Western Interconnection. Working with the Public Utilities Commission (PUC), the Independent System Operator (ISO) and the California Energy Commission (CEC), CARB must adopt these regulations by July 31, 2010.
Last November, Governor Schwarzenegger built on his commitment to accelerating the state's renewable energy standard and signed Executive Order S-14-08 to streamline California's renewable energy project approval process and increase the state's RPS to the most aggressive in the nation at 33 percent renewable power by 2020. The Governor also called on the legislature to pass legislation increasing the state's RPS to meet that target and, in May, sent legislative leaders a letter outlining what would need to be included in legislation - most importantly, that it increase the state's renewable energy portfolio standard while protecting ratepayers and creating a healthy market.
Unfortunately, the bills the legislature recently passed are unnecessarily complex, would substantially increase costs on Californians and California's businesses and, if passed, the state standard could be held up in legal battles because the bills violate the U.S. Constitution's commerce clause by restricting the sale of energy across state lines. For these reasons, the Governor is taking action administratively today to increase California's RPS to the highest in the nation - 33 percent by 2020.
In 2007, the Governor called for an acceleration of the RPS, and signed SB 107 by Senator Joe Simitian (D-Palo Alto) requiring investor owned utilities to have 20 percent of their electricity come from renewable sources by 2010. Previously, state law passed in 2002 required that this target be achieved by 2017.
In September 2006, the Governor signed the Global Warming Solutions Act of 2006, California's landmark bill that established a first-in-the-world comprehensive program of regulatory and market mechanisms to achieve real, quantifiable and cost-effective reductions of greenhouse gas emissions. The law will reduce carbon emissions in California to 1990 levels by the year 2020. AB 32 requires CARB to develop regulations and market mechanisms that will ultimately reduce California's greenhouse gas emissions by 25 percent by 2020. Mandatory caps will begin in 2012 for significant sources and ratchet down to meet the 2020 goals. The Governor has also called for the state to reduce carbon emissions to 80 percent below 1990 levels by the year 2050.
The Governor has led California in establishing laws and policies aimed at helping to promote renewable energy and fight global warming, including:
In September 2008, Gov. Schwarzenegger signed AB 1451 by Assemblyman Mark Leno (D-San Francisco), AB 2466 by Assemblyman John Laird (D-Santa Cruz) and AB 2267 by Assemblyman Felipe Fuentes (D-Sylmar) to build on California's commitment to increase renewable energy use. AB 1451 builds on the state's solar power usage by continuing a property tax exclusion for projects that utilize solar panel energy and expanding the exclusion to builder-installed solar energy systems in new homes. AB 2267 builds on the state's green economy by requiring the CPUC to grant incentives to eligible California-technology manufacturers. This bill also requires the Energy Commission to give priority to California-based companies when granting awards and will not only create jobs for hardworking Californians but will attract more clean-tech and green-tech companies to the state. AB 2466 will increase energy efficiency and help protect the environment by authorizing local governments to receive a utility bill credit for surplus renewable electricity generated at one site against the electricity consumption at other sites.
In 2007, Governor Schwarzenegger furthered his historic leadership to reduce greenhouse gas emissions and lower California's reliance on foreign oil by signing Executive Order S-01-07 that established the world's first Low Carbon Fuel Standard for transportation fuels sold in California. The standard will reduce carbon content in all passenger vehicle fuels sold in California by at least 10 percent by 2020 and more thereafter.
In 2006, the Governor announced his Million Solar Roofs Plan to provide 3,000 megawatts of additional clean energy and reduce the output of greenhouse gases by three million tons, equivalent to taking one million cars off the road. Now known as the California Solar Initiative, the $3.3 billion incentive plan for homeowners and building owners who install solar electric systems will lead to one million solar roofs in California by 2017.
Announced as a component of the California Solar Initiative in 2007, the New Solar Homes Partnership (NHSP) aims to create a self-sustaining market for solar homes and gain builder commitment to install solar energy systems. A new home that qualifies for the NSHP is at least 15 percent more efficient than the current building standards.
California's push to fight global warming and increase renewable energy will also boost our economy. According to an economic study by the University of California at Berkeley and Next 10, California's policies will create as many as 403,000 jobs in the next 12 years and household incomes will increase by $48 billion.
The full text of the EO is below:
EXECUTIVE ORDER S-21-09
WHEREAS the State of California is a world leader in efforts to reduce global warming and greenhouse gas emissions, increase renewable energy production, promote energy efficiency and energy conservation, improve clean air and emissions controls, expand the use of low carbon and alternative fuels and promote and commercialize new environmental technologies and industries; and
WHEREAS producing electricity from renewable resources provides multiple and significant benefits to California's environment and economy, including improving local air quality and public health, reducing global warming, diversifying our energy supply, improving energy security, enhancing economic development and creating jobs; and
WHEREAS California has and can access some of the best renewable energy resource areas in the world, providing immense potential for clean, valuable electricity generation, and the development of these resources must be accelerated and maximized; and
WHEREAS the Legislature enacted the California Global Warming Solutions Act of 2006 (Chapter 488, Statutes of 2006, hereinafter "AB 32"), wherein the Legislature declared that global warming poses a serious threat to the environment of California and created a comprehensive, multi-year program to reduce greenhouse gas emissions that cause global warming; and
WHEREAS AB 32 designated the Air Resources Board ("ARB") as the state agency charged with monitoring and regulating sources of greenhouse gas emissions in California; and
WHEREAS among other requirements, AB 32 directs ARB to design emissions reduction measures, adopt regulations requiring the reporting and verification of greenhouse gas emissions, including accounting for greenhouse gas emissions from all electricity consumed in the state, and develop emissions reduction measures, including limits on emissions of greenhouse gases applied to electricity and natural gas providers serving customers in California; and
WHEREAS substantially increased development of renewable energy, energy efficiency, and demand response are all needed to meet the greenhouse reduction goal of 1990 levels by 2020 and 80 percent below 1990 levels by 2050, making the success and expansion of renewable sources of energy a key priority for California's economic and environmental future; and
WHEREAS increased use of renewable electricity is one of the most promising means to reduce greenhouse gas emissions in the transportation sector and meet California's 2050 greenhouse gas reduction goals; and
WHEREAS fostering greater and more timely renewable energy development requires a more cohesive and integrated statewide strategy by California's energy and environmental agencies, including greater coordination and streamlining of the siting, permitting and procurement processes for renewable energy generation, improving the manner in which California develops its transmission infrastructure, and encouraging technically and economically feasible distributed renewable energy technologies; and
WHEREAS in 2002, Senate Bill 1078 added to Chapter 2.3 of Part 1 of Division 1 of the Public Utilities Code, a new Article 16 (commencing with Section 399.11) establishing the California Renewable Portfolio Standard (RPS) Program, which requires the State Energy Resources Conservation and Development Commission ("CEC") and the Public Utilities Commission ("PUC") to work collaboratively to implement the RPS Program; and
WHEREAS Senate Bill 1078 established a renewable energy standard and required electrical corporations to increase their total procurement of eligible renewable energy resources by at least 1 percent per year so that 20 percent of their retail sales are procured from eligible renewable energy resources by 2017; and
WHEREAS in 2003, I called for an acceleration of the RPS, urging that 20 percent of California's electricity come from renewable sources by 2010 rather than 2017, seven years earlier than previously required, and this accelerated standard became law in September 2006, when I signed Senate Bill 107; and
WHEREAS in 2003, the PUC and the CEC adopted the 2003 Energy Action Plan I, which accelerated the RPS 20 percent renewable energy goal to 2010; and
WHEREAS in 2006 Senate Bill 107 and Senate Bill 1036 further defined the roles and responsibilities of the CEC and PUC and accelerated the implementation of the RPS; and
WHEREAS as stated in Executive Order S-14-08, an increase in renewable energy production has multiple and significant benefits to California's environment and economy, including improving local air quality and reducing greenhouse gas pollution among other benefits; and
WHEREAS as stated in Executive Order S-14-08, increased development of renewable electricity sources, energy efficiency and demand response are needed to meet the greenhouse gas reduction goal of 1990 levels and 80 percent of the 1990 levels by 2050, making the success and expansion of renewable energy sources a key priority for California's economic and environmental future; and
WHEREAS the goals and purposes of the RPS Program and the goals and purposes of AB 32 are mutual and compatible because an increase in the use of renewable electricity will reduce greenhouse gas emissions; and
WHEREAS the joint and coordinated efforts of the energy and environmental agencies are intended to assure that the goals and purposes of these various programs will be implemented by investor-owned and publically-owned utilities to the maximum extent operationally and economically feasible and thereby will achieve the greatest results; and
WHEREAS the expansion of the RPS Program and the implementation of a complementary regulation under AB 32 designed to further reduce greenhouse gas emissions through the expansion of electricity production from renewable energy sources will advance the goals and purposes of both programs; and
WHEREAS the AB 32 Scoping Plan adopted by the ARB in December 2008 recommends achieving a statewide renewable energy mix of 33 percent as a key element for reducing greenhouse gas emissions to 1990 levels by 2020; and
WHEREAS such a complementary regulation under AB 32 will encourage the development and use of renewable energy beyond those required by the RPS Program; and
WHEREAS Executive Order S-14-08 established a target that all retail sellers of electricity shall serve 33 percent of their load with renewable energy by 2020; and
WHEREAS publically-owned utilities provide a significant amount of electricity in California and must be included in statewide efforts to reduce greenhouse gases from their systems in a manner that recognizes their individual circumstances.
NOW, THEREFORE, I, ARNOLD SCHWARZENEGGER, Governor of the State of California, by virtue of the power vested in me by the Constitution and statutes of the State of California, do hereby order effective immediately as follows:
1. That the ARB, under its AB 32 authority, shall adopt a regulation consistent with the 33 percent renewable energy target established in Executive Order S-14-08 by July 31, 2010. In developing the regulation, the ARB may consider different approaches that would achieve the objectives of the Executive Order and may increase the target and accelerate and expand the time frame based on a thorough assessment of such factors as technical feasibility, system reliability, cost, greenhouse gas emissions, environmental protection or other relevant factors.
2. That the ARB shall work with the PUC and the CEC to ensure that a regulation adopted under authority of AB 32 to encourage the creation and use of renewable energy sources shall build upon the RPS Program and shall regulate all California load serving entities, including investor-owned utilities, publically-owned utilities, direct access providers and community choice aggregators.
3. That the PUC and the CEC are requested to provide advice and assistance to, and cooperate with, the ARB in its consideration and implementation of a regulation to reduce greenhouse gas emissions through the creation and use of renewable energy sources. The ARB may delegate to the PUC and the CEC any policy development or program implementation responsibilities that would reduce duplication and improve consistency with other energy programs such as demand response, energy efficiency and energy storage.
4. That the ARB shall consult with the Independent System Operator and other load balancing authorities on, among other aspects, impacts on reliability, renewable integration requirements and interactions with wholesale power markets in carrying out the provisions of this Executive Order.
5. The ARB shall establish the highest priority for those resources that provide the greatest environmental benefits with the least environmental costs and impacts on public health that can be developed most quickly and that support reliable, efficient, cost-effective electricity system operations including resources and facilities located throughout the Western Interconnection.
This Order is not intended to create, and does not create, any rights or benefits, substantive or procedural, enforceable at law or in equity, against the State of California, its agencies, departments, entities, officers, employees, or any other person.
I FURTHER DIRECT that as soon as hereafter possible, this Order be filed in the Office of the Secretary of State and that widespread publicity and notice be given to this Order.
IN WITNESS WHEREOF I have hereunto set my hand and caused the Great Seal of the State of California to be affixed this 15th day of September 2009.
Governor of California
Secretary of State