Letter from Sacramento: Why We Oppose the Regional Grid Bill

Sometimes wonky, inside-baseball issues can wind up creating worrisome risks for the environment, communities and workers.

 

Whether California should become part of a new, multi-state regional transmission organization (RTO) that oversees how electricity flows around the west is just such an issue. The idea is sometimes referred to in the press as a regional grid.

 

In simple terms, the idea is to create a collaboration of several states, including California, that would be able to easily sell energy back and forth across state lines and throughout the west.

The folks who really love this idea think that it will resolve an interesting problem: To make sure that California solar and wind companies have enough customers—a big enough market—to buy their renewable energy at the main times of the day solar and wind power are pumping out electrons.

 

So everyone who loves renewable energy should just get on board this peace train, right?

 

Wellllll, not exactly. As it turns out, without the right kinds of boundaries and rules, this great idea can go quickly amok.

 

For instance, as Sierra Club’s experts on how energy companies and markets in the west work note, it’s very possible that if not designed the right way, a regional grid could result in “resource shuffling.” That is, it might actually encourage certain coal-heavy power companies to extend the life of their plants in one part of the west and shift the renewable energy to California. Or it could fire up more natural gas plants here and in other states.

 

All that extended and increased use of fossil fuel plants to accommodate the ability of California’s “excess” renewable energy to flow east and the Interior West’s supply to flow to California can add up to more localized air pollution, especially for communities already struggling with dirty air, and more greenhouse gas pollution. That equals human health and planet health impacts.

 

There are also economic risks that cut to the core of whether California will build a more equitable economy.

 

California has been steadily adding renewable energy to its energy mix. This has meant lots of new jobs building big and small renewable energy generation. And not just any jobs, but good-paying jobs. Many of these jobs are held by union labor and come with good healthcare benefits and retirement plans. These are jobs that demonstrate that you can have a clean environment and a living wage.

 

What happens if California’s single-state transmission operator suddenly becomes a multi-state entity with states that have cheap labor, cheap land and anti-union laws? Thanks to legislation passed a couple of years ago, the biggest proponent of regionalization, the California Independent System Operator (CAISO) hired a consultant to tackle that question.

 

The answer was that regionalization could likely result in the loss of 110,000 jobs in the energy sector in California. That’s almost as many jobs as there are people in Berkeley.

 

There’s also an interesting political risk.

 

There’s a guy in the White House now who doesn’t like—well, apparently actually hates—renewable energy and just about anything California stands for. He appoints the majority of commissioners on the federal body that sets the rules about how RTOs operate their electricity transmission.

 

If California, which through the CAISO is essentially its own RTO, joins with other states in a new RTO, that new RTO will have a governing board made up of people from the other states. If the federal body comes up with a new rule that California disagrees with, but the other states in the RTO agree with, what happens? Does California just leave the RTO and is that even possible?

 

Is now really the time to dive into this kind of risk?

 

These questions and issues are among those that Sierra Club staff and activist volunteers have been asking and raising for the better part of the three years that the legislature has been considering regionalization.

 

Throughout that time, we have been unable to resolve our concerns. That’s partly because opening up our state to a regional market simply means accepting certain risks. We aren’t willing to put our full faith in the market to deliver an equitable energy economy that benefits--rather than harms--polluted communities and that provides long-term, good-paying jobs. We remain genuinely concerned about exposing California to the undue weirdness of the supreme tweeter’s appointees’ whims.

 

And that’s why we have most recently opposed Assembly Bill 813, a bill crafted in the open, but not crafted well enough to protect California from the worst potential effects of regionalization. You can read our explanation of our opposition via the letter we signed onto with consumers and labor.

 

Dozens of other groups have opposed this bill.

 

But the governor supports it and spent some time the night before it came up for its first committee vote last week calling legislators on the committee and urging them to support the bill. It passed that committee and on Tuesday will face the Senate Judiciary Committee.

 

The bill is based on an interesting idea. But it doesn’t provide the protections we need for the environment, public health and the economy.

 

We can do better than this. We must do better than this.

 

That’s why we oppose AB 813 and again, for the third time in three years, find ourselves fighting a wonky, inside-baseball issue.