Senate Energy, Utilities & Communications Committee
 

Senator Christine Kehoe, Chair

02.06.07 RPS Hearing Testimony

Madam Chair, members of the committee, thank you for the opportunity to address you today. My name is Tom Habashi. I am the Utility Director for Roseville Electric, a department of the city of Roseville. I am speaking to you today on behalf of my community, as well as the other public power communities and districts that comprise the Northern California Power Agency.

NCPA is a nonprofit California joint powers agency established in 1968 to generate, transmit, and distribute electric power to and on behalf of its fifteen members: the Cities of Alameda, Biggs, Gridley, Healdsburg, Lodi, Lompoc, Palo Alto, Redding, Roseville, Santa Clara, and Ukiah; the San Francisco Bay Area Rapid Transit (BART), the Port of Oakland, the Truckee Donner Public Utility District, and the Turlock Irrigation District; and two associate members: Placer County Water Agency and the Plumas-Sierra Rural Electric Cooperative. Together, we serve nearly 700,000 electric consumers in Central and Northern California.

Renewable energy is nothing new for NCPA member utilities. When NCPA started in the 1960s, our first generation project was a non-polluting hydroelectric facility—a project approved by then-NCPA chairman Byron Sher. In the decades since then, we have steadily improved the efficiency and output of that resource. The same is true for our geothermal energy facilities. We initiated a new, horizontal drilling technique that greatly extended the life of the steam fields, ensuring that our communities would continue receiving energy from this renewable source for years. NCPA’s generation sources are 64% renewable— 96% renewable if large hydro is factored in.

All individual NCPA members have formally established Renewable Portfolio Standard (RPS) policies of at a minimum 20% renewables by 2017. That’s not to suggest that we are not attempting to meet the goal of 20% by 2010. Specifically, some member utilities have far more ambitious policies, such as Palo Alto, which has set a 2008 target date to achieve a 21% RPS—while still other NCPA members already exceed the 20% goal on this very day, including the Cities of Santa Clara, Redding, Alameda, Healdsburg and Ukiah, which are at 30% RPS or greater.

If NCPA were counted as a single utility— adding together each member utility’s load and RPS percentages— our current amount of electricity produced from eligible renewable energy sources would be more than 21%. If large hydro is factored in, that number jumps to more than 68%.

In numerous debates, the Legislature has recognized the inherent differences in size, geographic location, and weather patterns between the state’s locally owned electric utilities, and has given us, within the guidelines of existing law, the flexibility that we need to create renewable energy programs that cater to our unique load profiles and customer needs, while still achieving the intent of RPS legislation. Over the years, that flexibility for local control has certainly paid off.

Here in Roseville, we have established one of the most successful solar home programs in the country. Roseville's City Council recently adopted Roseville Electric's plan for the Blueprint for Energy Efficiency and Solar Technology (BEST) Homes. The BEST Homes program is a visionary program that calls upon home homebuilders to integrate photovoltaic systems and high energy efficiency appliances and features into 10 to 20 percent of new home construction. As part of this program, we are partnering with Lennar Homes, a national homebuilder, to build more than 600 new homes in the West Roseville Specific Plan Area with these high energy efficiency measures and integrated rooftop solar generation systems. This will be the largest solar community in America. We have also applied for and were granted $11 million of the Clean Renewable Energy Bonds, or CREBs for short, to install 11 PV systems, totaling one megawatt on the roof-tops of city facilities. Finally we are requiring as a standard feature in the West Roseville Specific Plan and future developments a number of energy efficiency measures that exceed title 24. We expect all 16,000 homes constructed in the West Roseville Area to be built with these features.

The flexibility that we have to implement programs that are locally tailored have allowed us to focus on one of the prime attributes of Roseville—rapid growth and new home construction. Roseville Electric developed the BEST homes program— which offers rebates to homebuilders for the energy efficiency and solar options— because our customers are interested in all types of energy efficiency measures— including rooftop photovoltaic systems— as a way to reduce utility costs and support a cleaner environment by reducing energy use and using renewable energy technologies.

We have also launched, last year, a program called Green Roseville, which gives our customers the additional option of paying extra for their electricity to ensure that their energy comes from 100% renewable sources. Thus far, we have over 1000 customers signed up and we hope to double that by the end of this year.

Roseville is currently at 45% renewables— 11% if you subtract large hydro. We are actively working to expand this amount to our goal of 20% by aggressively seeking new contracts, and expanding our solar homes program I previously spoke of. This is not to say that there are no obstacles. Some of the problems that we are encountering is the inability of the existing transmission infrastructure to deliver renewable resources, the lack of creditworthiness of many renewable energy suppliers, and the need to firm wind contracts. Renewable Energy Credits can be part of the short term solution in helping us and other communities that have yet to reach the 20% threshold, but regardless, we will not rest on our laurels.

I want to take a moment to highlight some of NCPA’s other member utilities, and the efforts they have undertaken to lessen our dependence on fossil fuel sources of energy.

The City of Palo Alto, like Roseville and other communities in Northern California, also has a green power program which allows its customers to pay more to ensure that 100% of their electricity comes from renewable sources. Palo Alto’s program, Palo Alto Green, is one of the most successful green energy programs in the nation. The program, which purchases 100% of its renewable power from in-state generation, has achieved the nation's highest participation rate, according to the National Renewable Energy Laboratory. With 13.6% of utility customers enrolled, Palo Alto Green greatly outperforms the national average of 1.3% participation for green pricing programs. In addition to participation from residential customers, business support for the program is also strong, and includes some of that community’s largest job providers, such as Agilent Technologies, Hewlett Packard, Lockheed Martin, and Roche Bioscience.

Additionally, the City of Palo Alto has recently partnered with the City of Alameda— another NCPA member utility— to purchase 3.2 megawatts of energy, enough power for 3,000 homes, from a new landfill-gas project in Watsonville, just outside of Santa Cruz. 3.2 megawatts may not seem like a lot, but the impact is immediate. 50% of landfill-gas is made up of Methane, which is twenty-one times more potent than carbon dioxide as a greenhouse gas. Instead of flaring the gas off, which is the traditional method for eliminating the natural buildup of landfill gas, the facility captures the gas and uses it as fuel to generate power for homes and businesses in Alameda and Palo Alto. This will improve air quality by an amount equivalent to removing more than 27,000 cars from the highway – or preventing the use of 286,000 barrels of oil annually.

The City of Redding, with its extreme summer climate and large peak load, has invested heavily in Thermal Energy Storage technology as a way to shift the time when electricity is demanded for purposes such as air-conditioning. Such peak shifting technology has proven to be a very valuable tool for Redding’s utility business since it reduces the amount of needed peaking generation, which is often dirtier, less efficient, and costly.

In addition to using such innovative load shifting technology, the City of Redding has recently made large direct investments in renewable energy sources for their customers. In the past year alone, Redding entered into a 15 year Power Purchase Agreement for 10 megawatts of biomass energy, and a 20 year agreement for 70 megawatts of wind power, pushing their renewable content to 31% from eligible sources—62% if large hydro is factored in. As with other publicly owned utilities, the flexibility that the City of Redding is afforded has allowed it to craft an energy policy and procurement strategy that has added significant renewable energy resources, reduced greenhouse gas emissions, and increased the efficiency of existing resources.

NCPA’s strong environmental ethic began in the 1960s with major investments in hydroelectric resources and later, our geothermal resources. This principle of environmental stewardship continues today through public power systems’ aggressive investment in new renewable energy projects, innovative load shifting and efficiency efforts, and green power purchase programs for our customers. We undertake these efforts not simply because we’re told to by the State, but because our customers— who are also our owners— demand it.

I can speak for all NCPA members when I say that Northern California’s public power systems and their governing boards are committed to expanding their supplies of renewable energy, and being a part of the state solution to lessening California’s dependence on polluting sources of electricity. We see the great diversity that NCPA’s membership enjoys not as an impediment to this effort, but rather as an asset—an asset that requires each community to target their efforts to create innovative and effective programs that are best tailored to our communities.

Thank you Madam Chair. I’d be happy to answer any questions that you or the other committee members may have.