Climate change law spurs rule to limit greenhouse gases from power plants

By: DAVE DOWNEY - Staff Writer | Tuesday, January 23, 2007 10:51 PM PST ∞

NORTH COUNTY ---- A state utility regulator is poised to establish an industrial carbon dioxide limit for new power plants as part of California's precedent-setting, controversial campaign to slash greenhouse gas emissions.

It would force operators of new plants to stay within a limit or pay other utilities that stay well below it in a so-called cap-and-trade system that would aim to reduce emissions.

The proposed limit is something most modern natural gas-fired plants should have not have trouble meeting, commission officials said. But they said the standard would prevent new coal-fired plants from being built in California unless utilities propose to use advanced technology to slash carbon emissions.

"We're not trying to push any particular technology here," said Nancy Ryan, a Public Utilities Commission adviser. "We're just trying to set the bar."

The agency is proposing to set the bar at 1,000 pounds of carbon dioxide for every megawatt generated per hour. According to the proposed rule, the typical modern natural gas-fired plant spews out about 900 pounds per megawatt-hour.

A megawatt is the standard measuring unit for electricity, and most of the time can keep the lights on in 750 to 1,000 homes.

If approved, the rule would take effect Feb. 1, as prescribed by a new state law, and apply to plants receiving state permits after June 30.

The rule would apply to plants that run at least 60 percent of the time, meaning smaller so-called peaker plants that lay dormant most of the year but ramp up on hot days would not be affected. The rule would apply only to plants with at least a 50-megawatt capacity.

By comparison, the capacity of San Diego Gas & Electric Co.'s natural gas-fueled Palomar Energy Center in Escondido is 550 megawatts.

Julie Fitch, the commission's director of strategic planning, said in a telephone conference call Tuesday that the rule is a response to passage of Senate Bill 1368 last year and will pave the way for the 2011 debut of the cap-and-trade program.

The region's largest energy company, San Diego-based Sempra Energy, which built the Escondido plant, says it can live with the rule.

"We were supportive of 1368 and we are fully supported of the resource performance standard that will be taken up by the commission on Thursday," said Sempra spokesman Art Larson.

Under the cap-and-trade program, a cap will be set for carbon emissions overall and each power plant will be given a target. If a plant is unable to meet its target, it will be able to purchase a credit from another electric company that reduces more emissions than required.

Many scientists say they believe emissions of carbon dioxide and other greenhouse gases are causing climate change, which could trigger droughts, coastal flooding and water shortages across California. Other scientists say it's unclear whether such gases are having a dramatic impact.

Michael Peevy, commission president, said the rule should have little impact on California electricity supplies or air conditioning costs for consumers.

"I would hope that there will be none," Peevy said.

However, he said, "I don't think any of us can answer that to any degree of certainty."

Peevy said that while the rule may prevent coal-fired plants from being built, it should not affect supply and price. Coal power generates 20 percent of the electricity used in California, he said, but almost all is brought in from other states.

He also said the state expects to obtain large chunks of energy in the future through such renewable sources as solar power, wind farms and geothermal plants that tap underground geysers. A state law requires 20 percent to come from such sources by 2010.

"We're going to make that or come very close to it," Peevy said.

San Diego Gas & Electric Co. has cited that goal as one reason it wants to build the $1.3 billion, 1,000-megawatt Sunrise Powerlink transmission line, which would run from the Imperial County desert through Anza-Borrego Desert State Park and Ramona to the coast. Imperial County is expected to eventually become a mecca for nonfossil fuel power.

SDG&E also says that San Diego County needs extra power to meet the requirements of a growing metropolis with an increasing dependence on electricity. Sunrise opponents say less destructive alternatives closer to home, such as replacing aging power plants in Carlsbad and Chula Vista with cleaner ones, would meet the utility's goals.

-- Contact staff writer Dave Downey at (760) 740-5442 or ddowney@nctimes.com.