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Calif. PUC orders SDG&E to buy more small solar contracts

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Essential Energy Insights - February 2021

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Six trends shaping the industries and sectors we cover in 2021

Six trends shaping the industries and sectors we cover in 2021


Calif. PUC orders SDG&E to buy more small solar contracts

TheCalifornia Public Utilities Commission unanimously ordered toaward small renewable energy contracts to more bidders that did not make theutility's competitive price requirement or hold another solicitation for suchprojects.

Aspart of the PUC's July 14 resolution,the commission approved the only project SDG&E submitted, namely ' 20-MWsolar Midway Solar Farm III. The utility will purchase an average annual 58.3GWh and associated renewable energy credits for 20 years. The Imperial Valleyproject is expected to start production Dec. 1, 2017.

MidwaySolar was the only project the San Diego utility picked from its sixth annualrenewable auction mechanism, or RAM, solicitation.

However,the PUC said SDG&E still has a shortfall in meeting the commission's RAMtargets. SDG&E was required to procure 164.7 MW over six RAM auctions, buthas procured only 62.7 MW from them, the commission said.

SDG&Econtended that it has enough renewables and does not want to spend a higherprice for more. The Sempra Energysubsidiary is already exceeding its renewable portfolio standard requirements,having met 35.2% of its retail energy sales with renewables in 2015. Thispercentage is subject to review and audit by the PUC and other regulatoryagencies, which typically is completed by September, Sempra utilitiesspokeswoman Amber Albrecht said by email.

Tostay on track toward a 50%-by-2030 RPS requirement established by law in 2015,utilities have to meet a 25% RPS by the end of 2016.

However,in addition to meeting RPS requirements, the PUC has previously SDG&E and otherutilities to solicit contracts from independent power producers to developsmall-scale photovoltaic facilities.

SDG&Esaid that only one of the 35 bids it received from its 2015 solicitation wascost-competitive, but the PUC ordered the utility to make up for its RAM targetshortfall with the bids it received to help promote the growth of smallerrenewable projects.

Alternatively,the utility may hold a seventh RAM solicitation to procure the requisitecapacity to meet SDG&E's remaining RAM requirements. If held, the seventhsolicitation must close by June 30, 2017, the PUC said. "SDG&E'srational for not meeting RAM targets ignores a commission order and, as such,is not justifiable," the PUC concluded.