How Valuable is your Renewable Energy in California?

The California Public Utilities Commission (CPUC) has taken the next step in answering that question through its issuance of a ruling on July 12 requesting comments on the implementation of the "3 bucket" procurement category structure mandated by Senate Bill (SB) 2 (1x).

We recently issued an advisory summarizing a new renewables rulemaking in which the CPUC will attempt to address numerous questions regarding changes to California's RPS program resulting from SB 2 (1x).  One of the most-anticipated questions is how the CPUC will define each of the three procurement categories --the answer to these questions will have major economic implications for generators and could mean the difference between having the opportunity to participate in the California renewables market by virtue of your generation qualifying for the most advantageous bucket (i.e., in-state and in-state equivalent products) or, alternatively, being "shut out" of the Calfornia renewables market by virtue of your generation qualifying the two much less advantageous buckets (i.e., "firmed and shaped" products or "REC-only" products). And with each of the "Big Three" utility RFO bidding deadlines having passed, generators (in particular those out-of-state) remain puzzled as to where their renewable generation might fall.

Interested parties are urged to continue to monitor this rulemaking closely, and if you are a generator which has recently entered a bid in one or more of the utility RFO's, you should strongly consider participating in this proceeding by filing comments in response to the Administrative Law Judge's recent ruling requesting comments about issues related to the buckets.  Opening comments are due no later than August 8.  Reply comments are due no later than August 19.