FIT Coalition Update – SB32, WDG, FIT activities

I expect thatmany of you have heard that SB32 was signed in to law by Governor Schwarzenegger on October 11th. A special thanks goes out to everyone who put in their letters-of-support to get that bill signed!

While SB32 was an incrementalwin for renewable energy,it is only a small step in implementing a simple, fair, and effective FIT program in California. To give you a sense of the significant work still to be done, here is a list of key activities (current and upcoming) in which the FITCoalition is active:

• Wholesale Distributed Generation (WDG) awareness: WDG is the only market segmentthat can support significant growth in renewable energy deployments. CEC commissioned studies show that the immediate potential of WDG is hundreds of GWs in California, a Statewhich has a peak demand of only 60GW. At the same time, Retail DG (aka, net metering) does not scale because it misses the majority of the rooftop market, and most central station renewables projectsare decades away from coming online due to dependencies on transmission build-outs.
• CARB implementation of the 33%-RPS-by-2020 Executive Order: Governor Schwarzenegger recently issued an Executive Order that California will achieve 33% renewables by 2020. CARB is very knowledgeable about FITs and has heard the CEC’s formal recommendation for an immediate implementation of a comprehensiveWDG FIT. This means that if the CPUC fails to make progress on its FIT and RPS objectives, CARB will have the authority to implement programs that actually work!
• SB32 implementation: The CPUCis now charged with modifying the existing AB1969 FIT-like program according to the improvements specified in SB32. The most important change will be to incorporate environmental attributes and locational benefits into the FIT pricing.The FITCoalition is actively providing research & analysis to assure that the price is set at a level that will actually stimulate developers to deploy projects.
• FIT Auction proposal: The CPUC has proposed a quasi-FIT that would be priced using an unpredictable, auction-based process. The FITCoalition has filed official comments and continues to work on making sure such a program will at the very leastprovide a level playing field for all participants; whether the developers are large or small, new or entrenched. The FITCoalition will also be working to assure that at least the smaller segment of WDG, say 5MW-and-under, is implemented using a predictable, cost-based pricing mechanism; just like every successful FITprogram in the world.
• AB1106: As we announced previously, AB1106 was turned into a 2-year bill, which means that it is frozen in the legislative process until the new year. This actually puts the FITCoalition in a great position next year. With all the uncertainties around SB32, the FIT auction proposal, and the solar programs proposed by the major utilities, the CPUCappears to be serious about implementing some kind of FIT-like program. With AB1106, we are positioned to act in 2010 if the CPUC continues to fail to get renewables deployed. So, while the FIT Coalition is working with the CPUC,we are alsogearing for a legislative push in the 1st quarter of next year; along with a big push at CARB.

Overall,the FIT Coalition isexcited that there is so much activity happening around WDG FITs right now.In that respect it is good to be so busy! We are going to need a lot of help going forward, however, so please consider helping in any manner that you can, including financially. To give us the best chances for success, the FITCoalition will need financial contributions from industry players, foundations, and/or well intentioned individuals who can help us truly scale renewables in America!

Please let us know how you can engage in the FITCoalition efforts. In addition to financial support, we alwayswelcome helpful contributions of time and energy, including taking up our call-to-actions when policymakers need to hear from folks.

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Ted Ko
Associate Executive Director
FIT Coalition