California Assembly Passes Bill to Increase Renewable Energy

June 2, 2006

Under AB 1969, the Public Utility Commission (PUC) will determine the price of sold energy based on the market rate for renewable power.

Sacramento, California [RenewableEnergyAccess.com] On a bipartisan 56-8 vote, the California State Assembly approved legislation Thursday to increase the production of renewable energy in California.

AB 1969, authored by Speaker pro tem Leland Yee (D-San Francisco/Daly City), will allow water and wastewater agencies to sell environmentally-friendly energy -- such as small hydro, solar, and biogas -- produced by their treatment and delivery facilities to electrical companies, resulting in up to 250 new megawatts (MW) of energy into the state's grid.

"This bill will significantly help the state meet our renewable energy goals and improve the environment through a reduction in greenhouse gases," said Yee. "Currently, hydroelectric energy is being wasted at small- and medium-sized water agencies simply because the law doesn't allow them the opportunity to capture that resource. AB 1969 will remove obstacles to such production and encourage the full potential of renewable energy generation by the state's water and wastewater agencies."

Specifically, AB 1969 will require electrical corporations to create standard contracts for the purchase of qualifying renewable energy from public water and wastewater agencies. The legislation will provide new renewable energy generation resources that otherwise would not be developed; help electrical companies meet their Renewable Portfolio Standard (RPS) goals and resource adequacy requirements (20% by 2010); improve the environment through a reduction in greenhouse gases; and offset rising energy demand and increasing water treatment and delivery costs.

"California has a promising opportunity to increase energy production while also helping our environment," said Yee. "As the demand for water and energy grows, it is imperative that water agencies be able to offset their increased needs through the sale of energy being generated at their plants, which will also result in significant savings for residents."

The rising cost of energy directly impacts consumers, both for their own energy consumption and for their water and wastewater service, which is greatly impacted by the price of energy. The state's water infrastructure currently accounts for nearly 20% of the overall electrical consumption. Under AB 1969, the Public Utility Commission (PUC) will determine the price of sold energy based on the market rate for renewable power.

AB 1969 will now be considered in the State Senate.

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