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March 29, 2011

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SACRAMENTO –Legislation authored by State Senator Joe Simitian (D-Palo Alto) that would put California in the national forefront in its commitment to renewable energy is headed to Governor Jerry Brown. Senate Bill 2X would require private and public utilities to obtain 33% of their electricity from renewable energy sources by 2020, raising the target from the current 20%, while providing the flexibility necessary to meet the higher standard.

The measure passed the Assembly today. It passed the Senate on a vote of 26-11 in February.

“This bill establishes California as the national leader in clean energy,” said Simitian, “improving the environment and stimulating the economy, while protecting ratepayers from excessive costs.”

Simitian made the case that the bill would:

• Improve air quality.
• Address climate change. 
• Protect customers from rate manipulation by diversifying our sources of energy.
• Allow for an American foreign policy based on American values and American interests, rather than energy needs.
• Attract investment and create jobs in renewable research and power generation.

“With Senate Bill 2X,” said Peter Miller, Senior Scientist at the Natural Resources Defense Council, “California is committed to build a diverse and resilient energy resource base that takes the threat of climate change seriously and brings the state closer to meeting its air pollution goals.”

As a stimulus to investment, Simitian said, “Senate Bill 2X sends a signal to renewable energy providers that California wants them here. They will respond, as they have in the past, with billions of dollars in investments that will provide jobs and tax revenues.”

“Passage of SB 2X is a vital step in providing renewable energy companies with the market certainty that drives business investment and job creation,” said Tom Werner, CEO of SunPower Corp., a global solar company headquartered in the Silicon Valley. “Our new California solar manufacturing plant is a direct result of the strong policy support that the 33% Renewable Portfolio Standard represents.”

The potential of California’s energy market is confirmed by Jan Smutny-Jones, executive director of the Independent Energy Producers Association.  “My members are creating jobs here in California today,” he said. “We have billions of dollars invested throughout California in biomass, in solar, in wind, in geothermal, and we’re looking to bring more of them here.”

Senate Bill 2X applies to all electricity retailers in the state – investor-owned utilities (IOUs), municipal utilities, and independent sellers. The current 20% standard applies only to investor-owned utilities and independent sellers. The California Public Utilities Commission (PUC) expects IOUs to provide 21% of their electricity from renewables in 2011. Municipal utilities have adopted renewable energy goals, which only some have met.

“Fossil fuels are finite and demand for energy is growing,” said Simitian. “Fossil fuel prices are going to keep heading up. Renewable prices are headed down.”

Senate Bill 2X does not require utilities to reach the goal at any cost. The PUC must approve renewable energy contracts, and utilities may be granted exemptions if the price of energy, or the difficulty of moving it into the state’s grid, make the cost excessive. For these reasons the bill is endorsed by the PUC’s Division of Ratepayer Advocates and consumer watchdog The Utility Reform Network (TURN).
Senate Bill 2X is supported by environmental groups and renewable energy producers, Southern California Edison and San Diego Gas & Electric, many of the state’s municipal utilities and unions representing construction and electrical workers.

Senate Bill 2X is a key component of the Clean Energy Jobs Initiative that the Democratic leadership in the Legislature has pledged to move to the desk of Governor Jerry Brown as part of the current special session on the budget and economic development.

Simitian has pushed to establish the 33% standard over the past four years. In 2009 the Renewable Energy Portfolio Standards bill, Senate Bill 14, was approved by both houses of the Legislature, but vetoed by Governor Schwarzenegger over concerns about precisely what energy contracts would qualify to meet the goal. In 2010, Senate Bill 722 addressed those concerns and garnered strong support for the 33% standard, but did not pass the Legislature by the end-of-session deadline.

California’s current renewable requirement, Senate Bill 107, authored by Simitian and enacted in 2006, established a 2010 deadline for 20% renewables. Utilities expect to exceed that goal this year, consistent with the provisions of SB 107.

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