Sara kamins meeting rps


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Sara kamins meeting rps

  1. 2. Presentation Overview <ul><li>Renewables Portfolio Standard (RPS) program overview </li></ul><ul><li>Progress toward RPS targets </li></ul><ul><li>Project development barriers </li></ul><ul><li>Solutions for achieving RPS in a cost-effective and timely manner </li></ul>
  2. 3. Overview of 20% RPS Program <ul><li>All RPS-obligated retail sellers* must have procured an incremental 1% of retail sales (from baseline year) in renewable energy per year until 2010 </li></ul><ul><li>20% obligation starts in 2010 and continues indefinitely </li></ul><ul><li>California has a further goal of 33% by 2020 </li></ul><ul><li>RPS satisfied by MWhs generated on system-side of meter and delivered to CA, when applicable </li></ul><ul><li>Bundled contracts only now, but potentially tradable RECs soon </li></ul>*RPS-obligated entities include: Investor owned utilities, energy service providers, small and multi-jurisdictional utilities, and community choice aggregators. Municipal utilities (not regulated by the CPUC) have a voluntary RPS obligation. All California retail energy sellers must procure 20% renewable energy by 2010
  3. 4. RPS Program Goals <ul><li>Statutory goals of the RPS include: </li></ul><ul><ul><li>Diversifying California’s electricity supply for reliability, public health and environmental benefits </li></ul></ul><ul><ul><li>Promoting stable electricity prices by hedging against volatile natural gas prices </li></ul></ul><ul><ul><li>Stimulating sustainable economic development </li></ul></ul><ul><ul><li>Developing competitive procurement process to obtain least-cost, viable MWhs in a short time frame (“cost, risk, time”) </li></ul></ul>RPS policy reflects statutory goals
  4. 5. Status of RPS Procurement <ul><li>CPUC has approved ~ 166 contracts for over ~ 13,000 MW of new and existing eligible renewable energy capacity </li></ul><ul><ul><li>~5,000 MW of long and short term contracts currently under review </li></ul></ul><ul><li>~1080 MW of projects under long-term contracts have come online since 2003, 50% out-of-state </li></ul><ul><li>~1000 MW of projects under short-term contracts have come online since 2003; 99% out-of-state </li></ul><ul><li>Participation in RPS solicitations is increasing: </li></ul><ul><ul><li>Greater participation from larger and more experienced developers </li></ul></ul><ul><ul><li>Dramatic increase in number of solar PV bids </li></ul></ul><ul><ul><li>2009 RPS solicitation resulted in 100,000 GWh of bids </li></ul></ul><ul><ul><li>Shortlisted 2009 bids would meet half of IOUs’ 33% target </li></ul></ul>Recent RPS solicitations have been robust
  5. 6. RPS Procurement Process CPUC approves RPS procurement plans IOUs hold annual solicitation IOU rank bids pursuant to “least-cost, best-fit” methodology <ul><li>Independent evaluator oversees solicitation, bid evaluation, and </li></ul><ul><li>negotiations </li></ul><ul><li>Utilities can also sign bilateral contracts </li></ul>IOUs negotiate bids, execute contracts Once the IOU executes contract, must submit to the CPUC for approval
  6. 7. Utilities on Track for RPS Targets Almost at 33% on a contract basis – but some face risk
  7. 8. Project Development Barriers <ul><li>Of 140 approved contracts, 23 have been terminated and 10 are delayed (have missed commercial online date) </li></ul><ul><li>CPUC identifies and tracks the development barriers for each approved RPS project </li></ul><ul><li>Significant project development barriers: </li></ul>RPS solicitations attract larger projects, which face project development risk and take time to develop <ul><li>Transmission </li></ul><ul><li>Permitting (CEC and County) </li></ul><ul><li>Site control (e.g., BLM application process) </li></ul><ul><li>Project financing </li></ul><ul><li>Developer experience </li></ul><ul><ul><li>Technology maturity </li></ul></ul><ul><ul><li>Fuel supply </li></ul></ul><ul><ul><li>Equipment procurement </li></ul></ul><ul><ul><li>Military radar </li></ul></ul>
  8. 9. CPUC Working on Solutions <ul><li>Tradable Renewable Energy Credits (TRECs) </li></ul><ul><ul><li>Increases procurement options and increases competition </li></ul></ul><ul><li>Renewable Energy Transmission Initiative (RETI) </li></ul><ul><ul><li>Identifies most cost-effective renewable resource zones and transmission to access them </li></ul></ul><ul><li>33% Implementation Analysis </li></ul><ul><ul><li>Analyses costs and tradeoffs between various 33% RPS scenarios </li></ul></ul><ul><li>More robust long-term procurement planning methodology </li></ul><ul><ul><li>Streamlining inputs and assumptions in utility procurement scenarios to understand their fossil needs in relation to all other demand and supply-side energy programs </li></ul></ul><ul><li>Programs aimed at smaller system-side DG projects </li></ul><ul><ul><li>To hedge against risk and timing of larger-scale RPS projects, programs for smaller RPS-eligible projects emerging </li></ul></ul>CPUC is working to create multi-agency solutions to known barriers
  9. 10. System-Side DG Programs SCE accepting bids in September 2010 N/A All technologies Up to 20 MW IPPs 250 SCE RSC Program At least 1 auction per year, implementation D.10-09-016 approved program, Staff to implement Solar PV Primarily ground-mount 1-5 MW 26 MW UOG 74 MW IPP 100 SDG&E Solar Program At least 1 auction per year, first in Q1 2011 Approved in D.10-04-052, Staff implementing Solar PV Primarily ground-mount 1-20 MW 250 MW UOG 250 MW IPP 500 PG&E Solar Program At least 1 auction per year, first in 4/2010 Fully Implemented (D.09-06-049) Solar PV Primarily rooftop 1-2 MW 250 MW UOG 250 MW IPP 500 SCE Solar PV Program (SPVP) Proposes 2 auctions per year Proposed Decision All technologies Up to 20 MW 3 large IOUs 1000 RAM Contracts accepted until cap reached CPUC working to implement for IOUs All technologies Up to 3 MW IOUs and municipal utilities 750 (incl. FIT) Senate Bill 32 Contracts accepted until cap reached Fully Implemented (D.07-07-027) All technologies Up to 1.5 MW All IOUs 500 Feed-In Tariff (AB 1969) Market Opportunity CPUC Status Eligible RPS Technologies and Project Size Participating Buyers and Sellers Program Size (MW)
  10. 11. Renewable Auction Mechanism <ul><li>Key program design elements of RAM include: </li></ul><ul><ul><li>Standard Contract </li></ul></ul><ul><ul><ul><li>Simple contract based on the IOUs’ existing feed-in tariff contract. </li></ul></ul></ul><ul><ul><ul><li>Terms and conditions are set before the auction and cannot be negotiated. </li></ul></ul></ul><ul><ul><li>Market-Based Pricing </li></ul></ul><ul><ul><ul><li>Sellers compete for a contract in a renewable auction mechanism. </li></ul></ul></ul><ul><ul><ul><li>Bids are selected by least-cost price first until the auction capacity cap is reached. </li></ul></ul></ul><ul><ul><ul><li>Price (and contract) is not negotiable and is paid as bid. </li></ul></ul></ul><ul><ul><li>Project Viability </li></ul></ul><ul><ul><ul><li>Minimum viability criteria to participate in the auction, e.g. 100% site control, developer experience constructing a project of similar technology and size. </li></ul></ul></ul><ul><ul><ul><li>Project development security, performance assurance (for >5 MW projects). </li></ul></ul></ul><ul><ul><ul><li>Project must be online within 18 months. </li></ul></ul></ul>CPUC may offer new simple, streamlined opportunity for system-side DG consistent with RPS goals
  11. 12. Questions? <ul><li>Sara Kamins </li></ul><ul><li>Senior Policy Analyst, RPS Team </li></ul><ul><li>California Public Utilities Commission </li></ul><ul><li>Phone: 415-703-1388 </li></ul><ul><li>Email: </li></ul>
  12. 13. RPS Solicitation Bids by Fuel Type Solar participation has increasing most dramatically
  13. 14. Breakdown of Solar Bids by Technology