SB1122 Staff Report Update

On November 19, the Energy Division’s Staff Proposal on SB 1122 Implementation and B&V Study (PDF) was released. Interested parties have until December 20th, 2013 to submit comments. To learn more about the SB1122 proceeding and the most recent developments, check out the CPUC site.

  Some key proposals pertaining to wood bioenergy produced from byproducts of sustainable forest management are highlighted below:

1. Projects eligible to seek a FIT contract pursuant to SB1122 may not seek a contract pursuant to the baseload, peaking, or as available categories of the FIT.

2. SB 1122’s 250 MW procurement requirement should be allocated across the three large IOUs by share of statewide peak demand: PG&E – 110.78MW, SCE – 114.53MW, SDG&E – 24.68MW.

    

   

3. Only new facilities whose initial commercial operation date is on or after June 1, 2013 will be eligible for SB1122.

4. Any bioenergy project securing a contract pursuant to SB1122 must source 100% of its fuel from Renewable Portfolio Standards eligible sources and at least 80% of its fuel on an annual basis from bioenergy resources within the SB1122 category.

5. The bioenergy feedstock for a category 3 project must be sourced from one or more of the following:

1. Fire Threat Reduction - Bioenergy feedstock from fuel reduction activities identified in a fire plan approved by CAL FIRE or other appropriate state local, or federal agency.

2. Fire Safe Clearance Activities - Bioenergy feedstock from fuel reduction activities conducted to comply with PRC Sections 4290 and 4291. This would include bioenergy feedstocks from timber operations conducted in conformance with 14CCR 1038(c) 150’ fuel reduction exemption.

3. Infrastructure Clearance Projects - Bioenergy feedstock from fuel reduction activities undertaken by or on behalf of a utility or local state or federal agency for the purpose of protecting infrastructure, including but not limited to: power lines, poles, towers, substations, swtich yards, material storage areas, construction camps, roads, railways, etc. This includes timber operations conducted pursuant to 14 CCR 1104.1(b)-(g).

4. Other Sustainable Forest Management - Bioenergy feedstock certified and approved as being derived from “sustainable forest management” by CAL Fire or another appropriate state or federal agency. View CalFire Forest Sustainability and Feedstock Verification Recommendations (PDF).

6. The pricing structure for SB1122 should utilize a single remat pricing mechanism for each bioenergy category to set a statewide price for each category. Implementation of this pricing structure should include the following elements:

1. Individual Projects will submit PPRs directly to a single utility.

2. Each IOU will maintain its own ReMAT queue per bioenergy category consistent with the capacity targets proposed above: PG&E – 110.78MW, SCE – 114.53MW, SDG&E – 24.68MW.

3. Execution of a FIT contract by a bioenergy project will result in capacity of that project being attributed to the SB1122 capacity target for the utility with which the project signs its contract.

4. The IOUs will jointly administer a statewide “price pool”for each of the three SB1122 bioenergy categories to establish a single, statewide FIT payment rate for each of the categories to.

    

   

7. The reMAT starting price was set at 124.66/MWh for all three bioenergy categories.

Important Dates

  Pursuant to the ALJ ruling, opening comments from parties are due on December 20, 2013, and reply comments are due on January 16, 2014.

  Following the submission of comments and reply comments, the ALJ will issue a Proposed Decision that will be subject to additional party comment. Final implementation of SB 1122 will occur after the CPUC formally adopts a Decision. All information is available from the CPUC site.