Calpine Contract Helps Utility To Become First To Meet California Renewable Goal
A new contract between Calpine Corp. and Pacific Gas and Electric Co. will help allow the Northern California utility to meet the state's renewable portfolio standard. The deal, according to a report in Friday's (Feb. 15) San Francisco Chronicle, makes PG&E the first utility to reach that goal.
In an announcement, PG&E said it would seek approval from the California Public Utilities Commission for a 175-megawatt geothermal purchase agreement with Calpine. The deal consolidates six existing agreements, and adds 57 megawatts of renewable power to PG&E's supply, the utility reported. PG&E noted the agreement would deliver enough new energy from Calpine's Geysers field north of Calistoga (pictured at left; courtesy of Calpine) to supply 45,000 homes. PG&E said that with the agreement, 20 percent of the utility's contracts for future energy delivery would meet California's renewable energy standard. That attains the figure set by the state under a 2006 law that expanded on earlier legislation requiring utilities to meet renewable energy goals.
The state's largest utilities, including PG&E, have until 2010 to meet the state's demands. The Chronicle noted that the standard, which state policy makers are now working to boost to 33 percent, has been tough to meet:
Even PG&E's achievement comes with a caveat. The company now has enough power contracts to hit 20 percent, but some of those contracts won't kick in until after the state deadline passes, delivering power to PG&E customers in 2011. That isn't a legal problem. If a utility falls just short of 20 percent by the end of 2010, it can still comply with the law by overshooting the 20 percent goal the following year.
But that caveat underscores the difficulty utilities have had in meeting California's ambitious renewable-energy goals. Simply put, the state does not have enough geothermal generators, wind farms and solar power plants to produce as much clean energy as California's politicians and citizens want. More renewable-power projects have been proposed, but it's an open question how many will get built.
Nevertheless, numerous projects are on the drawing boards and the state's ambitious goals would seem to provide significant incentives for at least some of them to go forward, and quickly, as California attempts to meet its self-imposed demands to reduce greenhouse gas emissions under legislation such as 2006's AB 32.
