Regulatory Challenges to Alternative Energy

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Presentation given on March 30, 2010, at Cornell Law School in Ithaca, New York. Titled “Environmental and Regulatory Challenges to Developing Energy Alternatives – a Case Study,” the presentation focused on difficulties companies face when seeking regulatory approvals for proposed solar thermal energy projects in Southern California.

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Regulatory Challenges to Alternative Energy

  1. 1. GENEVA | HOUSTON | KANSAS CITY | LONDON | MIAMI | ORANGE COUNTY | SAN FRANCISCO | TAMPA | WASHINGTON, D.C. Environmental and Regulatory Challenges to Developing Energy Alternatives – A Case Study Seminar Program on Law, Science and Sustainability Cornell Law School, Ithaca NY – March 30, 2009
  2. 2. Disclaimer This presentation is based in substantial part on publicly-available, non-copyright protected internet resources, including but not limited to materials published by the California Energy Commission, the U.S. Bureau of Land Management, and Solar Millennium LLC. No representation is made herein regarding the accuracy or completeness of information provided in these materials, nor does any reference to or reliance on that information constitute an endorsement of the views expressed by the publishers.
  3. 3. The Goal – Increasing the Use of Renewable Energy Resources in the United States
  4. 4. California Renewable Portfolio Standard • California’s Renewable Portfolio Standard Program established in 2002, with the goal of increasing the percentage of renewable energy in the state's electricity mix to 20 percent by 2010. • Senate Bill 107 created the California Renewable Portfolio Standard (RPS), codifying the 20 percent goal and requiring electric utilities to increase procurement from eligible renewable energy resources by at least 1 percent of retail sales annually. • Executive Order S-14-08 (November 17, 2008) requires California utilities to reach a 33 percent renewables goal by 2020. • Renewable energy sources utilize many different technologies to produce electricity (solar (photovoltaic and thermal); large and small hydroelectricity plants; geothermal; biomass). • Solar thermal (using reflectors to concentrate sunlight to produce steam for use in conventional power generation turbines).
  5. 5. World Wide Solar Energy Intensity
  6. 6. Solar Energy Potential in the United States
  7. 7. Ridgecrest Solar Thermal Project • Applications for certification on file for 12 projects, located in San Bernardino, Kern, Imperial, Fresno and Riverside counties. • Total capacity under review: 4,802.8 MW. • Application of Solar Millennium LLC for Ridgecrest Solar Development Project (California Energy Commission DOCKET No. 09-AFC-9). • Located in the high northern Mojave Desert in northeastern Kern County, California, about five miles southwest of the City of Ridgecrest, California. • Utility-scale solar thermal electric power generating will have a nominal output of 250 megawatts (MW), consisting of a single power plant utilizing two solar fields. • Project right-of-way (ROW) will extend across approximately 3,920 acres of public lands owned by the federal government.
  8. 8. Ridgecrest Solar Thermal Project
  9. 9. Solar Thermal Technology • Solar parabolic trough technology to generate electricity. • Arrays of parabolic mirrors collect heat energy from the sun and refocus the radiation on a receiver tube located at the focal point of the parabola. • Heat transfer fluid (HTF) is heated to high temperatures (750 degrees Fahrenheit) as it circulates through the receiver tubes. • Heated HTF is piped through a series of heat exchangers where it releases its stored heat to generate high pressure steam. • Steam fed to a traditional steam turbine generator where electricity is produced.
  10. 10. Solar Thermal Technology
  11. 11. CEC Certification Authority • State law requires California Energy Commission (CEC) to certify “sites” for thermal solar power plants with a rated capacity of 50 megawatts or greater. – Commission has 5 members – 2 appointed as Committee to conduct the certification process. – All decisions made solely on the basis of the public record. • Sites are certified together with their related facilities (i.e. transmission lines, substations, water supply systems, natural gas pipelines, waste disposal facilities, access roads, etc.). • CEC is “lead agency” for California Environmental Quality Act (CEQA). • Also monitors compliance with all conditions of certification during life of the project, including closure and decommissioning.
  12. 12. Coordination with BLM • Federal Bureau of Land Management (BLM). – Administers public lands under Federal Land Policy and Management Act (FLPMA) Issuance of right-of-way grants for use of federal land under 43 CFR Sec. 2800. – Prepares land use plan (LUP) amendment to authorize proposed use (power generation and transmission). – Lead agency for National Environmental Policy Act (NEPA), National Historic Preservation Act, other Federal laws. • Major federal action triggering environmental review under NEPA. – Finding of No Significant Impact (FONSI). – Preparation of environmental impact statement (EIS). – Environmental review in conjunction with state law (CEQA). • BLM and CEC Memorandum of Understanding (MOU) concerning joint environmental review in a single NEPA)/CEQA process.
  13. 13. Coordination with Responsible Agencies • Local: – City of Ridgecrest and surrounding communities. • Regional: – Regional Water Quality Control Board (RWQCB). • State: – Department of Fish and Game. – State Water Resources Control Water Board (SWRCB). – Office of Historic Preservation. – Native American Heritage Commission. • Federal: – Environmental Protection Agency (EPA) – Department of the Interior (Fish and Wildlife Service, National Parks Service).
  14. 14. CEC Certification Process • Project proponent submits application for CEC certification. • CEC project staff reviews application to ensure that it meets minimum requirements and determination to accept application. • Staff discovery and analyses (data requests and responses; “issues identification” and public workshops). • Preliminary and Final Staff Assessment (FSA). • Committee evidentiary hearing and issuance of Presiding Member’s Proposed Decision (PMPD), including: – Findings relating to environmental impacts, public health and engineering considerations. – Determination of project’s compliance with Laws, Ordinances, Regulations and Standards (LORS), potential impacts to the environment, and related mitigation measures. – Recommendations regarding conditions of certification.
  15. 15. CEC Certification Process (Cont.) • PMPD hearing and Commission decision. • Judicial review (30 day CEQA statute of limitations).
  16. 16. Ridgecrest Certification Process TO DATE • ROW Application – 03/2007 • AFC Submitted – 09/2009 • Data Adequacy – 11/2009 • NOI Published – 11/2009 • Public Workshop – 12/2009 • Scoping Hearing – 01/2010 • Data Requests – 01/2010 GOING FORWARD • Data Submittal – 01/2010 • BLM ROD – 09/2010 • CEC Decision – 09/2010 • Notice to Proceed – 11/2010 • Begin Construction – 12/2010 • Begin Operations – 07/2013
  17. 17. Current Obstacles • Lack of direction regarding allocation of development in West Mojave LUP – BLM • Interim mitigation requirements uncertain – DFG, FWS, BLM • High level of detail required from applicant – CEC, BLM • Timing of compliance / combined schedule – CEC, BLM • Alternatives analysis overly prescriptive – CEC, BLM • Permitting status and process for network upgrades identified for renewables – CEC, CPUC, BLM
  18. 18. Issue 1 : Individual Impacts (Sacred Lands) • Mountainous area to the southwest of project site known as the El Paso Mountains Sacred Lands. • Listed in Native American Heritage Commission’s database of Sacred Lands. • Project could impact view shed identified by Native Americans as sacred. • Exclusive use of no more than 3,926 acres of public land could eliminate other BLM authorized land uses.
  19. 19. Issue 2 : Individual Impacts (Ground Water) • Project proposes using high quality groundwater from wells located within the Indian Wells Valley Groundwater Basin. • Proposed uses include: – Site construction. – Plant operations (power cycle makeup water, mirror wash water, domestic potable water, dust. suppression water, cooling of ancillary equipment). • Overdraft in basin will continue and be exacerbated by the additional water requirements of the project.
  20. 20. Issue 3 : Cumulative Impacts (Traffic) • Brown Road/S. China Lake Blvd./US 395 intersection (post mile 15) has overall collision rate 2.8 times higher than the State-wide average for similar type facility. • In both phases of the project (construction and operational), additional trips would be generated by assorted vehicle types. • New access point from US 395 is likely a necessity for the project.
  21. 21. Issue 4 : Process (Transmission) • July 28, 2009 California Independent System Operator (California ISO) Phase I Interconnection Study for project provided without the generation plant. • Required to determine the potential project’s impacts on existing transmission network. • CEQA analysis of potential downstream transmission upgrades could cause a delay in the licensing process.
  22. 22. DISCUSSION AND CONCLUSION
  23. 23. ENVIRONMENTAL AND REGULATORY CHALLENGES TO DEVELOPING ENERGY ALTERNATIVES – A CASE STUDY Kevin Haroff | Shook Hardy & Bacon LLP | www.shb.com Geneva | Houston | Kansas City | London | Miami | Orange County | San Francisco | Tampa | Washington D.C.

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