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Creating Western regional energy market could help state meet climate goals

Gov. Jerry Brown delivers a speech at the Vatican last month. Dozens of officials from around the world met at the Vatican to commit to reducing climate change.
Gov. Jerry Brown delivers a speech at the Vatican last month. Dozens of officials from around the world met at the Vatican to commit to reducing climate change. The Associated Press

Gov. Jerry Brown visited the Vatican recently to meet with Pope Francis and world leaders to discuss climate change. The issue has dominated this year’s legislative agenda, and the governor has made bold statements about combating climate change while also setting ambitious goals to reduce greenhouse gas emissions.

With less than two months left in this year’s legislative session, environmental groups including the Natural Resources Defense Council, Union of Concerned Scientists and the Environmental Defense Fund, are eager to see legislation to implement the governor’s plans to expand the state’s renewable energy goals from one-third by 2020, to 50 percent by 2030.

One opportunity for the governor to meet his goal for renewable energy is to partner with other Western states to create a regional energy market – the coordination of electricity systems across the West. A regional energy market is the most efficient, effective way to meet the West’s demand for reliable, affordable and sustainable energy. It will also help states in the region comply with strict new federal Environmental Protection Agency regulations under the Clean Air Act.

A regional energy market is not a new idea. It is a proven concept. In fact, 10 coordinated transmission management systems, called independent system operators or regional transmission organizations, already cover large parts of the U.S. and Canada. In contrast, the Western grid, which includes the California Independent System Operator, has 38 different “balancing area authorities” that are responsible for controlling the system in their own specific territories.

The result is costly development of duplicative infrastructure, inefficient use of the transmission grid, a lack of visibility between and among balancing area authorities, and poor situational awareness of energy availability and pricing.

A regional market also allows for a more efficient and cost-effective integration of large amounts of renewable energy resources like solar, wind, hydro, geothermal and others during times of under- or overgeneration. For example, California’s solar resources sometimes produce too much electricity during the late morning and early afternoon and sometimes don’t produce enough on cloudy days. Because the on-and-off variability of renewable power in one area can be balanced by renewables operating at different moments in another, a regional Western energy market will enable all areas serviced by the grid to have access to renewables for the power they need, when they need it and at the most affordable price.

According to a study by the California ISO, a functional Western grid using the state’s renewable requirement could lower pollution levels by nearly 2.6 million metric tons annually. That’s the equivalent of removing more than 230,000 cars from the road each year.

A regional grid would also maintain California’s clean air and emissions standards to ensure all power coming into the state complies with greenhouse gas rules. Any imported coal-generated energy is subject to the state’s cap-and-trade program, which imposes a carbon-related compliance cost – putting coal at a significant economic disadvantage in a regional market against renewables. If states can work together to coordinate grids and facilitate inclusion in the market, then all participating energy systems in the West will get cleaner and less expensive.

Creating a regional energy market in the West is a fundamental component to addressing climate change and achieving the state’s renewable energy goal. The governor supports the concept, telling the state’s business leaders that as part of his climate-change agenda he plans on investing in a sophisticated electrical grid that isn’t confined to just California. We look forward to working with him and legislative leaders to develop a plan that can benefit all states in the western region.

Carl Zichella is the director for Western transmission for Natural Resources Defense Council. He has extensive expertise in Western U.S. renewable energy transmission siting and serves on a nationwide team working on renewable energy development issues.

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