California modifies RPS

California has modified the structure of its renewable portfolio standard (RPS) to establish content categories for electricity source procurement, and set limitations of procurement in each category for the three compliance periods.

The changes are part of the California Energy Commission’s plan to develop an improved methodology for integrating the ambitious RPS into California electric utilities’ formal 10-year procurement plans.

California’s RPS was originally established in 2002, and aimed to achieve 20 percent renewable electricity by 2017. In 2006, the goal was accelerated to 20 percent by 2010, and in 2011 a new RPS goal of 33 percent renewable energy by 2020 was signed into law by California Gov. Edmund Brown. It became effective Dec. 10.

The new changes, which underwent a public comment period that ended mid-September, create three RPS-eligible categories. The first is in-state or in-state equivalent products, or generation interconnected with a California balancing authority or dynamically scheduled into a California balancing authority. 

This is intended to constitute the majority of new RPS procurement through 2020 and beyond, according to the commission. In the final RPS compliance period from 2017- 2020 and thereafter, a minimum of 75 percent of retail sellers' RPS procurement contracts executed after June 1, 2010, must be classified in category one.

The second category is firmed and shaped products that provide incremental power, a transaction wherein the buyer simultaneously purchases energy associated with the renewable energy credits (RECs) from the RPS-eligible facility but does not sell it back to the generator.

The third and smallest generation category is unbundled renewable energy credits—RECs unbundled from the RPS-eligible generation facility and sold separately— and other RPS products that don’t qualify under the other two categories. It is intended to be the smallest category, only consisting of 10 percent of procurement by the third compliance period.

According to the California Public Utilities Commission, three of California’s largest electric utilities served 17 percent of their 2010 retail sales with renewable power. Southern California Edison led with 19.3 percent.

For more details about California’s RPS and recent changes, visit www.cpuc.ca.gov.