BILL ANALYSIS �
SJR 13
Page 1
Date of Hearing: September 9, 2011
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Steven Bradford, Chair
SJR 13 (Vargas) - As Amended: August 16, 2011
SENATE VOTE : 21-15
SUBJECT : Public utilities: cross-border transmission lines
SUMMARY : Calls upon the Secretary of the United States
Department of Energy to reject Sempra Energy's application to
construct the Energ�a Sierra Ju�rez cross-border transmission
line between Mexico and California.
EXISTING LAW
Requires upon the adjournment of the first extraordinary
session, investor-owned utilities (IOUs); publicly owned
utilities (POUs); community choice aggregators (CCAs); and
energy service providers (ESPs) to increase purchases of
renewable energy such that at least 33% of retail sales are
procured from renewable energy resources by December 31, 2020.
In the interim each entity would be required to procure an
average of 20% of renewable energy for the period of January 1,
2011 through December 31, 2013; 25% by December 31, 2016, and
33% by 2020. This is known as the Renewable Portfolio Standard
(RPS).
FISCAL EFFECT : Unknown
COMMENTS :
1)The author reports that "Sempra, the parent company of
(SDG&E), is proposing to outsource 1250 MW of green electrical
generating capacity to Mexico by connecting a one-mile
cross-border tieline from Mexico to the Southwest Powerlink
electrical transmission line close to the San Diego County and
Imperial County border. Sempra has applied for a Presidential
Permit from the U.S. Department of Energy. The line would
undercut the ratepayer investment that has already been made
on the Southwest Powerlink Transmission Line and the Sunrise
Powerlink. It would also deprive customers of the economic
benefits of building the renewable generation in southern
California. These lost benefits have been estimated at 15,000
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lost U.S. jobs and nearly $300 million in lost local, state
and federal tax revenue."
2)Presidential Permits - Any entity seeking to construct,
operate, and maintain electric transmission facilities across
the U.S. international border must apply to the DOE for a
cross-border Presidential permit. In order for a permit to be
issued, a finding that the proposed project is consistent with
the public interest and favorable recommendations from the
U.S. Departments of State and Defense are required. In
determining consistency with the public interest, DOE
considers the environmental impacts of the proposed project,
determines the project's impact on electric reliability
(including whether the proposed project would adversely affect
the operation of the U.S. electric power supply system under
normal and contingency conditions), and considers any other
factors that DOE may find relevant to the public interest.
DOE's issuance of a Presidential permit indicates that there
is no federal objection to the project, but does not mandate
that the project be undertaken.
3)Sempra has applied to the DOE's Office of Electricity Delivery
and Energy Reliability for a Presidential permit to construct
either a double-circuit 230 kV or a single-circuit 500-kV
transmission line. Sempra's proposed transmission line would
connect wind turbines to be located in the vicinity of La
Rumorosa, Baja California, Mexico, to the existing Southwest
Powerlink 500-kV transmission line (SWPL). A decision on the
permit is expected by December.
4)The wind projects are RPS eligible if they connect within the
Western Electricity Coordinating Council (WECC) and will not
cause or contribute to any violation of California
environmental quality standards or requirements. Baja, is
included in the Western Electric Coordinating Council, which
includes 14 western states, western Canada, and Baja. The
Sempra wind projects will connect to a balancing authority of
the California Independent System Operator (ISO).
5)The Sempra Baja wind projects would qualify to meet the RPS
requirements as 'Portfolio Content Categories (also known as
buckets). Bucket 1 which establishes a compliance target of at
least 50% of the generation meets this category through 2013,
65% through 2016, and 75% thereafter. Bucket 1 does not
mandate that all generation come from within the state's
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borders.
6)Renewable generation located outside of California's
boundaries are eligible as long as the interconnection point
is under the control of the ISO or another balancing authority
(such as LADWP) and if the facility is outside the United
States, it is developed and operated in a manner that is as
protective of the environment as a similar facility located in
the state. For example, Senator Simitian published a letter in
the Senate Journal on August 17, 201 explaining this specific
concern: "It is the intent of SB 2X as passed by the
California State Legislature in March 2011 that the wind
energy generated by the Chokecherry and Sierra Madre Wind
Energy Project located near Ralwins, Wyoming and transmission
via the TransWest Express Transmission Projects direct-current
transmission line without substituting power from another
source to one or more California balancing authorities in the
El Dorado Valley, Nevada can qualify as Portfolio Content
Category 1 Products for purposes of RPS compliance."
7)Resolution proponents argue that there is a fixed RPS
obligation for California's utilities and that the Sempra Baja
wind project will displace energy that instead could come from
renewable energy projects built here in the state. They note
that development of the Mojave and Colorado Desert regions of
Southern California, including Imperial County, has been a top
priority for the state and the Baja projects would reduce the
projects developed in that region.
8)According to a recent study entitled, "Should Green Jobs Be
Outsourced: A Case Study of Lost Jobs and Lost Opportunities,"
by University of Utah Economics Professor Dr. Peter Philips
this proposal, if approved, would outsource to Mexico 5 years
of work for 600 construction workers, 489 of whom otherwise
would have been residents of Imperial County, and 111 of whom
would have traveled from other parts of California, Arizona
and Southern Nevada to work in Imperial County.
9)Opponents of this regulation assert that SJR 13 will slow
California's transition to a clean energy future by
foreclosing access to a wind-rich region of Baja, California.
Other clean energy resource opportunities include solar and
geothermal projects.
10)SDG&E states that it has signed 26 contracts for delivered
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renewable power. Of these, four are out-of-state. SDG&E
projects that 72% of delivered energy in 2020 will come from
in-state renewable energy facilities. Approximately 50% of
this in-state power will come specifically from the Imperial
Valley. While more contracts are being signed, the current
ones in Imperial represent more than 2,000 construction jobs
and hundreds more for operating the plants when complete.
Currently, more than 2,000 men and women are working to build
the Sunrise Powerlink, which is been dedicated to deliver
green power from Imperial to San Diego.
11)Also according to SDG&E, the major outage in San Diego and
Arizona highlights the need for more power, not less. SDG&E
began purchasing geothermal power from Cerro Prieto in
Mexicali in the late-1970's. Power from Mexico also assisted
in San Diego's power needs during the massive firestorms in
mid-decade and kept the lights on in San Diego. Like Nevada,
and Arizona, Mexico is part of our energy region.
REGISTERED SUPPORT / OPPOSITION :
Support
California Labor Federation
California State Association of Electrical Workers
State Building and Construction Trades Council
The Utility Reform Network (TURN)
Western States Council of Sheet Metal Workers
Opposition
California Chamber of Commerce
California Manufacturers & Technology Association (CMTA)
Sempra Generation
Analysis Prepared by : Susan Kateley / U. & C. / (916)
319-2083