California Renewables Portfolio Standard Program: renewable feed-in tariff.
The proposed bill gives the commission the discretion to instead determine payments via competitive solicitation at least biannually. This change is significant as it may foster a more dynamic pricing environment for renewable energy, potentially encouraging more innovative energy solutions from smaller operators. Additionally, it empowers the commission to modify the standard practices for determining tariff payments, which could result in a shift in how clean energy projects are financially supported in California.
Senate Bill 1365, introduced by Senator Hertzberg, seeks to amend Section 399.20 of the Public Utilities Code and introduce Section 399.20.1. This bill allows the California Public Utilities Commission to establish a renewable feed-in tariff for small-scale electrical generation facilities. Currently, the Renewables Portfolio Standard Program mandates that retail sellers procure a minimum percentage of electricity from eligible renewable sources, escalating to 60% by 2030. Under the existing framework, electrical corporations are required to set tariffs that offer fixed payments for electricity over terms of 10 to 20 years based on market price and environmental costs.
While proponents argue that this bill enhances competitiveness and may lead to better pricing for renewable energy procurement, critics could express concern about the implications of reverting to competitive solicitations. There are apprehensions that such a model might disrupt the established revenue streams for smaller renewable energy projects, particularly those that may not have the resources to withstand the pressure of more competitive bidding. The ongoing tension between regulatory adaptations and the support of local renewable energy providers will likely be a focal point in future discussions.