SDG&E Likely to Miss Green-Energy Mandate

Wednesday, March 12, 2008 | San Diego Gas & Electric will not likely meet a state-mandated goal to get 20 percent of its electricity from renewable energy sources by 2010, making it the only state utility to admit that it expects to fall short of the green-energy mandate.

The state Legislature has established one of the country’s most aggressive goals for increasing the use of renewable energy sources such as solar, wind and geothermal, which have a less intense impact on climate change than fossil fuel-fired sources such as coal and natural gas. While 28 states are requiring utilities to increase their reliance on renewable energy, California set the shortest schedule.

SDG&E has said in regulatory filings with the Securities and Exchange Commission that it will likely fall short of that goal. The company has shown the least progress of any California investor-owned utility in boosting its reliance on green energy, today getting 6 percent of its supply from renewable sources. The state’s other two utilities are using more: Southern California Edison gets 16 percent of its energy from green sources, Pacific Gas & Electric receives 12 percent. Spokeswomen for both companies said they expect to meet the 2010 deadline.

SDG&E has agreements with developers of renewable energy sources and has hundreds of megawatts under contract — enough to provide 13 percent of its total supply. But many of those projects are not built and are not providing green energy to San Diego. The company blames delays in its application process to secure state approval of the Sunrise Powerlink, a $1.3 billion, 150-mile transmission line it has proposed between San Diego and Imperial County.

The issue highlights a challenge that renewable energy projects face across the state: Connecting far-off renewable electricity supplies with the cities that need them. In a recent report to the Legislature, the California Public Utilities Commission identified the state’s constrained transmission system as one of the major barriers to renewable energy development.

San Diego County and its surrounds have the potential to provide thousands of megawatts of solar, wind and geothermal energy — along with the open space to accommodate many of the projects.

“Clearly we know for our region the Imperial Valley, Mexico and East County mountains house a lot of renewables,” said Scott Anders, director of the Energy Policy Initiatives Center at University of San Diego. “The question is how you get it here.”

Southern California Edison started construction Friday on a power line to connect its customers to as much as 4,500 megawatts of wind power in Tehachapi, 40 miles southeast of Bakersfield, an Edison spokeswoman said. SDG&E uses existing transmission lines to convey its green-energy portfolio of 228 megawatts, enough power for about 150,000 homes. Most of its green capacity comes from windmills, including a 50-megawatt wind project in Boulevard and a 60-megawatt facility in Mojave.

While SDG&E has said it needs the Sunrise Powerlink to bring more renewable supplies to San Diego, another Sempra subsidiary, Sempra Generation is pursuing a federal permit to bring wind energy from Mexico to San Diego, connecting to an existing power line known as the Southwest Power Link, which runs along Interstate 8 from San Diego to the Arizona border. But the company says that power line is running out of capacity and wouldn’t provide sufficient space to bring in other new renewable supplies.

“In order for us to reach that 20 percent figure, it’s more than what the capacity on the Southwest Power Link could carry,” said Jennifer Briscoe, an SDG&E spokeswoman. “We would need more. We couldn’t push through all 20 percent that we need.”

The Sunrise Powerlink’s opponents maintain that the Southwest Power Link provides enough capacity to transmit renewable electricity sources — if they were given priority over fossil-fueled sources.

Michael Shames, executive director of the Utility Consumers’ Action Network, a ratepayer advocate fighting the Sunrise project, said he believed SDG&E’s made a strategic decision to tie an unappealing project — the new power line — with a more desirable green-energy future. Delays in the power line then resulted in delays in the renewable energy. Shames called it “a game of environmental chicken.”

“SDG&E took an interesting gamble,” Shames said. “It put all of its eggs in the Sunrise basket. SDG&E had no Plan B. … SDG&E essentially set itself up so that unless it got everything it wanted, it wouldn’t meet the goals.”

SDG&E’s Briscoe said the vast open spaces in the Imperial Valley were simply where most developers had proposed renewable projects and so Sunrise was the only way to tap into it.

“We’re actively out there trying to procure renewables from all types of developers,” she said, “but the largest happen to be in the Imperial Valley.”

The company faces other challenges beyond the proposed power line.

One of SDG&E’s largest renewable projects has so far failed to materialize. Stirling Energy Systems, a Phoenix-based solar developer, has a contract with SDG&E to build 300 megawatts of solar energy in Imperial County. That’s enough to power almost 200,000 homes. If successful, the venture could triple in size, powering as many as 600,000 homes. But the project, which would use mirrored dishes to focus the sun’s energy on a small engine, has shown little progress since being announced in 2005.

For the technology to be economically viable and find financing, its dishes must be produced commercially on an assembly line — not by hand. The company, which needs to manufacture 12,000 dishes to meet SDG&E’s contract requirements, still isn’t able to do that.

“They could build the [Sunrise Powerlink], but the anchor tenant of that line — Stirling — will not be providing anywhere close to the mega-wattage they’ve promised,” Shames said. “It’s sort of laughable to think that but for Sunrise they’d be meeting their goals.”

If SDG&E doesn’t meet the goals, it could be subjected to a $25 million annual penalty, though the Public Utilities Commission has the discretion to not enforce the fine.

Whether or not SDG&E meets the goals, the path the state’s utilities have set out on is still laudable, Anders said.

“I don’t think anybody doubts that there will be a challenge transitioning to a more carbon-free energy future,” he said. “But if you don’t start somewhere, you’re never going to get there.”

Please contact Rob Davis directly with your thoughts, ideas, personal stories or tips. Or send a letter to the editor.

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