BILL ANALYSIS Ó SCR 48 Page 1 Date of Hearing: June 15, 2015 ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE Anthony Rendon, Chair SCR 48 (McGuire) - As Introduced April 27, 2015 SENATE VOTE: 36-0 SUBJECT: Geothermal Awareness Month and Geothermal Awareness Day. SUMMARY: This resolution recognizes the month of May 2015, as Geothermal Awareness Month, and May 21, 2015, as Geothermal Awareness Day. Specifically, this resolution: a)Makes the following legislative findings: California contains the largest amount of geothermal generating capacity in the United States due to its location on the Pacific "Ring of Fire" and the tectonic plate junctions. There are 25 known geothermal resource areas located in California, 14 of which have temperatures of 300 degrees Fahrenheit or greater for commercial geothermal production of electricity. SCR 48 Page 2 California currently has 2,565.5 megawatts (MW) of installed electric generation capacity from geothermal resources with an additional 4,000 megawatts of potential for development. Geothermal energy is a reliable base load renewable energy source that has been commercially operating in California since 1960 at the Geysers, the world's most developed geothermal resource area, which has been providing Californians with clean, reliable, and affordable electricity for more than 50 years. Geothermal energy is essential and complimentary to California's environmental and economic policies, yet new fully permitted geothermal projects have failed to keep pace with the procurement of other renewable resources. The preservation of California's existing geothermal generation and the development of new geothermal generation could facilitate the achievement of the state's post-2020 energy and environmental goals. Recognizes the month of May 2015 as Geothermal Awareness Month to raise awareness of the significant contributions geothermal energy makes to California's Renewables Portfolio Standard Program and toward meeting the state's environmental goals to reduce greenhouse gas emissions. Recognizes May 21, 2015, as Geothermal Awareness Day in California, and urges all citizens to show their support on that day by learning more about geothermal energy in California and supporting public events planned by the SCR 48 Page 3 geothermal industry. The Legislature considers geothermal resources important to California's future, and recognizes the environmental and economic values of existing and future geothermal energy for the state and local communities. EXISTING LAW: 1)Establishes the California Renewables Portfolio Standard (RPS) program, which expresses the intent of the Legislature that the amount of electricity generated per year from eligible renewable energy resources be increased to an amount that equals at least 33% of the total electricity sold to retail customers in California per year by December 31, 2020. (Public Utilities Code Section 399.11) 2)Defines a renewable electrical generation facility to mean a facility that uses biomass, solar thermal, photovoltaic, wind, geothermal, fuel cells using renewable fuels, small hydroelectric generation of 30 megawatts or less, digester gas, municipal solid waste conversion, landfill gas, ocean wave, ocean thermal, or tidal current, and any additions or enhancements to the facility using that technology. (Public Resources Code Section 25741) 3)Directs the State Air Resources Board to monitor and regulate sources of emission of greenhouse gases that cause global warming in order to reduce emission of greenhouse gases. (Health and Safety Code Section 38510) FISCAL EFFECT: Unknown. This resolution is keyed non-fiscal by the Legislative Counsel. SCR 48 Page 4 COMMENTS: 1)Author's Statement: "California possesses more geothermal generating capacity than anywhere else in the world. Northern California's Geysers, the largest geothermal field in the world, produces roughly 60% of the energy demand for the North Coast. It not only produces reliable energy for the region, but it also partners with local municipalities in an innovative program that injects 20 million gallons of treated waste water daily into the geysers. This injection of wastewater spurs electricity generation without contributing to greenhouse gas emissions in the atmosphere, and also helps to protect local waterways and streams by diverting the sewer discharge that used to be added into surface waters. Investing in geothermal energy production is an economically and environmentally friendly way for California to fully realize AB 32's ambitious goals." 2)Background: In 2006, the Legislature enacted AB 32 (Nunez, Chapter 488, Statutes of 2006), which tasked the Air Resources Board to adopt rules and regulations that would reduce greenhouse gas emissions in the state to 1990 levels by 2020. Geothermal energy is a form of renewable energy that is generated by drilling into underground hot water reservoirs, such as geysers and hot springs, releasing the hot water as steam to the surface to produce electricity. Unlike solar and wind energy, which are considered intermittent renewables because they are dependent upon the weather to generate energy, geothermal power plants are considered base load facilities because they are able to operate 24 hours per day, 7 days per week, regardless of weather conditions. 3)California's Renewables Portfolio Standard: California's RPS was established in 2002 under SB 1078 (Sher, Chapter 516, SCR 48 Page 5 Statues of 2002), and was accelerated in 2006 under SB 107 (Simitian, Chapter 464, Statutes of 2006) to require that 20% of electricity retail sales be served by renewable energy resources by 2010. The RPS was again increased in 2011, through SBX1-2 (Simitian, Chapter 1, Statues of 2011), to require that 33% of electricity retail sales be served by renewable energy resources by 2020. In January 2015, Governor Brown proposed in his inaugural address three ambitious goals to be accomplished within the next 15 years. These goals are: Increase from 33% to 50% our electricity derived from renewable sources; Reduce today's petroleum use in cars and trucks by up to 50%; and Double the efficiency of existing buildings and make heating fuels cleaner. 1)California's Geothermal Industry: California currently has 2,782 MWs of installed physical capacity, which accounts for 4.4% of generation capacity and 25% of the renewable electricity supplied to retail customers. California has more SCR 48 Page 6 than 22 geothermal projects located across Imperial, Inyo, Lake, Mono, and Sonoma counties. In addition, the world's largest geothermal field, the Geysers, is located 70 miles north of San Francisco and contains 22 power plants that draw steam from more than 350 wells. An estimate by the United States Geological Survey suggests that California' geothermal resources could provide 800 to 4,600 MWs, with an additional 3,000 to 25,000 MWs of geothermal resources yet to be discovered but likely to exist. The resolution specifies that it is important to balance the needs of the state's transmission grid system. The state currently has a balanced transmission grid system and the resolution seeks to emphasize geothermal energy in the system. The resolution also highlights two proposed projects in Sonoma County which would create up to 19 full time jobs. Geothermal may provide a higher number of ongoing full time jobs compared to other renewable sources, once they become operational. 2)Prior Legislation: SCR 108 (Evans) 2014: Recognize the month of May 2014 as Geothermal Awareness Month, and May 5, 2014 as Geothermal Awareness Day. Chaptered by the Secretary of State - Resolution Chapter 65, Statutes of 2014. REGISTERED SUPPORT / OPPOSITION: Support SCR 48 Page 7 Calpine Center for Climate Protection Geothermal Energy Association Geothermal Resources Council Geysers Geothermal Association International Brotherhood of Electrical Workers Local 569 Lake County Chamber of Commerce Ormat Nevada Inc. Opposition None on file. SCR 48 Page 8 Analysis Prepared by:Edmond Cheung / U. & C. / (916) 319-2083