Congress and states are developing and implementing plans to mitigate the impact of climate change through measures that reduce greenhouse gases. Many of these efforts are focused on the electrical generation industry since approximately 40% of carbon dioxide emissions in the United States are created from burning fossil fuels to generate electricity. To reduce the greenhouse gases produced by the electrical industry sector, many greenhouse reduction plans have required increased generation of electricity through renewable, less-polluting, resources. In fact, the majority of states have now enacted a “renewable portfolio standard” (“RPS”), which mandates electric utilities to obtain a percentage of their power from renewable resources. Congress has attempted to follow suit by proposing several different versions of legislation for a national RPS. One of the most aggressive RPS requirements is in California, which requires 20% of the state’s energy to be generated from renewable resources by 2010 and 33% by 2020. Although California has expended significant resources towards meeting its RPS, it did not meet its 20% goal by 2010. Despite failing to meet its RPS targets, California utilities have justified continuing to build many new natural gas facilities by arguing that more natural gas capacity is necessary to backup renewables. California’s large natural gas capacity, however, was not necessary for meeting its 20% RPS target. Indeed, this building rush has resulted in California currently operating at an extraordinarily high reserve margin, which is forecasted to be 34.5% during the summer’s peak of 2010 (only 15% to 17% is necessary for backup). Not only is this large natural capacity expensive for California ratepayers, it inhibits renewable development. To meet its RPS in the future, California will need to change course and stop doing business as usual. California is not alone in its failure to meet its renewable requirements. Other states will also likely fail to meet their renewable standards and can learn from California’s experience. This article will examine and describe some reasons why California did not meet its renewable target in 2010. California’s failure is attributable to the confluence of several factors that resulted in the procurement of large amounts of new natural gas facilities despite not meeting renewable requirements and already high reserve margins. Three prominent reasons for California’s failure to meet its RPS are decentralized administration of its RPS program, the lack of strong enforcement provisions, and California’s extensive reliance on utility information instead of an independent analysis. Moving forward, California should enact enforceable clear requirements that are administered by one centralized agency, which conducts an independent assessment of renewable policies and goals
