Edison International, owner of California’s largest electric utility, said it will be difficult to keep increasing its use of renewable energy as the latest goal set by Governor Arnold Schwarzenegger stretches limits on the ability to manage such power sources.“It’s a goal we should be behind,” Chief Executive Officer Ted Craver said today in an interview in New York. “The issue isn’t to try to kill it or try to knock it out of the box, but to try to figure out how to satisfy that in a way that doesn’t put the system at undue risk.”
Under a November proposal that legislators may make law this year, Schwarzenegger said utilities should derive 33 percent of their power from renewable sources by 2020. California regulators already are considering allowing use of tradable renewable energy credits to help utilities meet a 20 percent renewables mandate by the end of next year.
The 2020 target would place even heavier reliance on wind and sunlight, intermittent sources that may be expensive to manage without blackouts, Craver said. Edison’s Southern California Edison utility probably won’t meet a 2010 mandate of 20 percent because generators and power lines needed to meet the goal still need regulatory approval, he said.
The complexity of maintaining adequate voltage on the power grid “starts escalating dramatically” when renewables reach 5 percent to 15 percent of supply, Craver said. “Thirty-three percent is something nobody has experienced before. It doesn’t mean we can’t do it, but we need to make sure we can do it and in a cost-effective manner.”
2010 Mandate
Edison will also have to tap into additional clean power sources outside the state to meet expanded mandates and keep costs under control, Craver said.
Edison will also have to tap into additional clean power sources outside the state to meet expanded mandates and keep costs under control, Craver said.
“If you say we’ve got to have 33 percent and we’ve got to do it only in California, you’d make it a great huge seller’s market, and that’s going to really raise the cost,” Craver said. “If you widen the area, then you have competition at work.”
Regulators don’t expect utilities to meet the 20 percent requirement by 2010, according to a California Public Utility Commission report to a state Senate committee in February. California has the state’s most aggressive renewable-energy requirement. Southern California Edison gets 16 percent of its supply from renewable sources now, Craver said.
Current rules allow utilities to hit the 20 percent target as late as 2013 for reasons such as lack of transmission lines to wind or solar plants.
Edison, based in Rosemead, California, derives more than half of its profit from regulated utility operations.
Edison rose 10 cents to $29.24 in New York Stock Exchange composite trading
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