The California Energy Commission (CEC) last Thursday unanimously approved its 2009 Integrated Energy Policy Report (IEPR), recommending a fresh mix of strategies for lowering the state’s greenhouse gas (GHG) emissions along with maintaining reliable, efficient and affordable energy supplies. The focus continued to be on reliability and renewable resources in this latest annual update of the report that goes to the governor and legislature.
This year’s 272-page IEPR recognized that California is experiencing reduced demand for electricity, natural gas and transportation fuels as a result of the economic recession. It assumes that this will turn around, however, and energy demand will start to grow again as the economy improves.
Global climate change as addressed in California’s three-year-old law (AB 32) established the GHG emissions reduction goal of getting back to 1990 levels by 2020, and this continues to drive all energy policy in the state, the CEC noted in the IEPR. This has widespread implication for energy efficiency, renewable projects and the state’s use of fossil fuels, particularly natural gas.
Top priority recommendations as described by the CEC would range from improved building/appliance standards on energy use to the goal of building “zero-energy new buildings during the next two decades.” It also means much greater reliance on renewable energy sources and supporting the development of pieces of the smart grid.
“California’s energy policy future requires a clear, well defined foundation that understands the energy issues and provides a strategy for energy programs,” said CEC Commissioner Jeffrey Byron, the presiding member for the two-member committee overseeing the development of the 2009 revision of the IEPR. “This report is the compass that will help make certain that the governor’s energy vision can be implemented.”
The CEC’s latest statewide report contains 22 policy recommendations spread over a wide variety of areas, keeping in mind the significant climate change mitigation measures on the drawing board for 2012 and beyond. “The state’s electricity, natural gas and transportation sectors must continuously respond to changes in supply and demand, new policies and technologies and their associated challenges, and increasing environmental regulation,” the IEPR said.
The report update notes that at the end of 2008, more than one-third of the state’s electric generation came from carbon-free sources — nuclear (14.4%), large hydroelectric (11%) and renewables (10.6%). Nearly half came from natural gas-fired generation (45.7%). Coal — almost all coming from out of state — provided the rest of the mix (18.2%).
CEC staff estimated future growth in demand to average 1.2% annually during the 2010-2018 period, and peak demand growth annually is expected to be a little higher at 1.3% over the same period.
Among the various sources of electricity, from efficiency and renewables to natural gas and coal, the IEPR concludes that natural gas will “continue to be a significant energy source for the foreseeable future,” and thus California needs to maintain a reliable gas delivery and storage infrastructure. “An expanding natural gas infrastructure will allow for the efficient delivery to California of increasing domestic shale gas production and liquefied natural gas imports,” the report said.
A specific recommendation calls for California to work with surrounding states to beef up the regional gas infrastructure as a means of providing a hedge against weather-related pipeline freezes and breaks.
In approving the revised report, the CEC acknowledged that there were lingering concerns among various stakeholders in the area of utility-required studies on the state’s two major nuclear generation plants, the fairness of the current process of selecting who builds new generation and transmission infrastructure, and questions about the validity of the measurements now used to calculate the energy savings and economic benefits of various utility-driven energy efficiency programs.
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