A bill has surfaced in the California Senate to prohibit new and renewed coal-fired electricity supply contracts for private and public utilities. SB 1368, sponsored by Sen. Don Perata (D-Oakland), is intended to reduce greenhouse gas emissions.

Large municipal utilities, such as the Los Angeles Department of Water and Power (LADWP), are watching the bill closely because it attempts to put restrictions on future power sources as the California Public Utilities Commission and California Energy Commission already started to do in a state integrated energy policy report and statewide energy plan.

Technically, the bill as written would prohibit utilities from signing power supply deals with sources with emissions above those of a combined-cycle gas-fired power plant's so-called "best available control technology" (BACT). "Basically, this would eliminate the ability to get new coal-fired power supplies or extend existing coal-fired generation contracts," said a LADWP official tracking the legislation.

Another, perhaps unintended, impact of the bill as written is that it appears to prevent any thermal peaking plants from being built because their emissions are all higher than the combined-cycle BACT plant levels, said the LADWP official, who noted that this part of the bill would probably be amended if it moves through the legislature. (A current draft of the bill says it applies to "baseload" plants, and defines those as plants that run for at least 60% of the hours in a year.)

In its opening language, SB 1368 makes it clear that, unlike existing law that exempts most entities other that private-sector utilities, this bill's intention is to be all-inclusive, covering "electrical corporations, community choice aggregators, electric service providers, and local publicly owned electric utilities." The CPUC would implement the new contract standards for all but the public sector utilities, which would be required to follow rules set by the state energy commission (CEC).

Among a laundry list of drivers for the legislation, SB 1368 specifically cites "global warming," the governor's executive order calling for a reduction of greenhouse gases (GHG) in the state, and the 2005 Integrated Energy Policy Report adopted by the CEC late last year.

The proposed legislation spells out some of the provisions of a procurement plan for utilities and so-called load-serving entities, and in that context it provides a new section in the CPUC code called the "Greenhouse Gases Emission Performance Standard for Baseload Electrical Generating Resources."

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