CEC Recommends Cost-Based Feed-in Tariff

By Paul Gipe


At the California Energy Commission’s final workshop on feed-in tariffs December 1, 2008, the presiding commissioners accepted the staff’s recommendation that California implement a system of feed-in tariffs.

The staff will complete a final report in early 2009 and will submit it for approval by the full commission. The report will then be incorporated into the 2009 Integrated Energy Policy Report, the IEPR.

The recommendation calls on the Public Utility Commission (PUC) to immediately implement a system of feed-in tariffs for projects up to 20 MW in size. The program should require a “must take” provision and tariffs should be based on the cost of generation and not to the Market Price Referant, the PUC’s term of art for wholesale avoided cost.

The CEC also recommended that the CEC and the PUC “continue” to evaluate feed-in tariffs for projects greater than 20 MW.

The PUC is not bound to follow CEC recommendations and both institutions jealously guard their respective jurisdictions.

The CEC’s 2008 Integrated Energy Policy Report Update was approved on November 20, 2008. The update is an interim report between the full IEPR that is issued every two years.

The 2008 Update discusses the CEC’s feed-in tariff workshops and makes the same recommendations (page 29) that were contained in the December 1, 2008 workshop.

California’s institutional wheels are grinding on and it’s likely that some kind of feed-in tariff system differentiated by technology and project size will move through the policy machinery in 2009.