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California passes renewable energy bill


With the passage of Senate Bill 2X (SB 2X) on April 12, public and private utilities in California will be required to obtain 33 percent of their electricity from renewable resources by the year 2020. The law has been received positively by several Stanford experts, including Steve Eglash, a member of the Precourt Institute for Energy and the executive director of the Environment and Affiliates Program.

SB 2X builds on regulation passed in 2006, which requires utilities to have 20 percent of their power come from renewable resources by the end of 2010, a figure that currently stands at 18 percent but is expected to be 20 percent by the end of 2011.

Accompanying California Governor Jerry Brown at the signing of SB 2X were Secretary of Energy Steven Chu and State Senator Joe Simitian (D-Palo Alto), the author of the bill. In a press conference, Chu said the law would “unleash clean-energy innovation and clean-energy investments,” while creating economic benefits.

He also commented on the recent finalization of a $1.6 billion federal loan guarantee from the U.S. Department of Energy to BrightSource Energy to help with their massive solar-thermal project in the Mojave Desert. Chu announced another nearly $1.2 billion loan to help a different solar energy facility, California Valley Solar Ranch project, sponsored by SunPower Corp., which will be located mainly in San Luis Obispo County.

Chu also mentioned the joint consortium between Stanford and UC-Berkeley that will “develop and test new technologies aimed at improving solar [photovoltaic] performance and bringing down manufacturing cost.”

Commenting on the implications of SB 2X, Eglash acknowledged that though the program would cost more in the short term, it would lower costs and provide other benefits in the long run.

“As individuals and as a society, we make decisions all the time that aren’t based on the absolute lowest cost but are made by weighing the intangible benefits,” Eglash said.

He noted that many of the costs of non-renewable power are not included in the bill’s final figure, such as pollution costs or involvement in oil-rich areas overseas.

Brown publicly stated that the bill would make California a new leader for renewable resources and praised Simitian for authoring such an innovative bill. He cited the bill as an example of overcoming the partisan divide that exists in Sacramento over the California budget.

“We have something that is a real success story,” Brown said.

The bill will help fulfill the requirements of AB 32, signed in 2006 by then-Governor Arnold Schwarzenegger, which includes a commitment to reduce greenhouse gases to 1990 levels by 2020.

“I believe that a decade from now, when we have hit 33 percent by 2020, we will look back on this day and say, ‘Look at what California has done,’” Simitian said at the press conference.

Because the bill has the force of law behind it, Eglash said it would be effective in its goal of reducing greenhouse gas emissions.

“I think [SB 2X] will undoubtedly be effective, both at increasing California’s use of renewable energy and also at creating jobs,” he said.

Eglash said jobs would be created through the construction of new energy plants, research and maintenance spurred by SB 2X.

Opposition to the bill largely stems from its economic cost, with many senators objecting that there would not be significant economic gains. Safeway Stores, which is the second-largest employer in California, opposed the bill, citing economic concerns.

State Senator Roderick Wright (D-Inglewood) said the bill could cost California $1.5 billion and claimed that the bill would raise California’s energy prices, which are already 18 to 20 percent higher than the national average, according to the California Manufacturers and Technology Association.

Brown, however, is confident about the law’s future.

“It’s California leading the country, and it’s America potentially leading the world,” he said.

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