Davis Signs Bill Boosting Clean Energy

Gov. Gray Davis on Thursday signed into law a renewable energy bill praised as ambitious by environmentalists but disdained as overly complicated by those who make electricity with the sun, wind and geothermal heat.

Advocates say the law will push California to the forefront of clean energy development. But nearly all the companies that make the renewable electricity oppose the bill as too cumbersome. They say it may actually impede construction of more wind and solar farms.

The governor also announced the signing of bills to preserve public beach access and set the rules for a future low-level radioactive waste dump now that the state has abandoned its effort at Ward Valley, near Needles.

SB 1078 by Sen. Byron Sher (D-Stanford) requires the state’s private utilities to increase the share of electricity they sell to customers that comes from renewable sources by 1% a year. The goal is to reach 20% by 2017.

Davis called the bill “the most ambitious” renewable energy standard in the nation. Consumer and environmental groups hailed the new law, saying that even though electricity production by sun, wind or underground steam costs more than burning natural gas, it helps reduce air pollution and buffers the state from gas price spikes.

Under SB 1078 and a companion bill, SB 1038, also by Sher and also signed by Davis, state regulators will set a benchmark price based on the long-term market cost of electricity. Renewable power sellers will then offer contracts of at least 10 years to the utilities. Any gap between the benchmark price and the price at which companies offer to sell can be bridged with a $135-million subsidy from a charge on customers’ monthly utility bills.

That charge--$2 a month for the average residential customer--was imposed in 1998 to help foster renewable energy and conservation and to assist poor people. A law passed last year extends the charge--which is less than half a cent per kilowatt-hour--until 2012.

Several aspects of the new law worry energy producers. That includes a requirement that in order to qualify for the subsidy they must pay workers prevailing wages, which are typically tied to union scales.

CalEnergy, which owns 10 geothermal power plants in Imperial County, plans a major expansion, said company Vice President Jonathan Weisgall. But CalEnergy would have to pay hundreds of construction workers wages comparable to those of Los Angeles and San Diego if it chose to sell its power to Southern California Edison and accept a subsidy.

“The prevailing-wage legislation may greatly increase the cost of building a renewable energy plant at a time when the state is already concerned about the already high cost of renewable energy,” Weisgall said.

Southern California Edison and Pacific Gas & Electric, which both support the bill, now get 12% to 15% of their electricity from renewable sources. San Diego Gas & Electric, a much smaller utility, gets roughly 1% of its power from renewable sources.

Davis also signed AB 2214 by Assemblyman Fred Keeley (D-Boulder Creek), which environmentalists described as “the final nail in the coffin” of Ward Valley. The administration of former Gov. Pete Wilson tried to license and construct a low-level radioactive waste dump at Ward Valley in the Mojave Desert.

The project was abandoned in 2000 because of concerns that radioactivity could migrate through underground drinking water supplies. California continues to ship low-level waste to Utah and South Carolina.

Keeley called the Ward Valley dump “a fatally flawed site with a fatally flawed strategy.” By establishing a clear set of standards for disposal of low-level nuclear waste, Keeley said his bill will encourage private companies to build a repository somewhere else.

The governor also signed SB 1962 by Sen. Richard Polanco (D-Los Angeles) to prevent the expiration of hundreds of offers by private landowners to provide public access to the coast.

Polanco’s bill requires the state Coastal Conservancy to accept the offers. In order to get permission to build along the coast, landowners often were required by the Coastal Commission to offer public access. The commission figured that cities, counties or nonprofit agencies would accept the offers and take responsibility for installing walkways and garbage cans and assume liability in case of injuries.

But local governments have been reluctant to step up, and hundreds of offers are nearing the end of their 21-year terms.

Davis also signed two bills related to the threat of oil spills: AB 2083 by Assemblywoman Hannah-Beth Jackson (D-Santa Barbara) allows the state to track the transport of oil by tankers between Los Angeles and San Francisco, and SB 849 by Sen. Tom Torlakson (D-Antioch) raises money for an oil spill prevention program by increasing the fee on a barrel of crude oil from 4 cents to 5 cents.