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Lesson from Cali Clean Power Veto: Transmission Still a Choke Point for Energy Goals

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Hundreds of bills escaped California Gov. Arnold Schwarzenegger’s veto power last night ahead of a midnight deadline to act on a mountain of legislation — but not a pair of long-debated clean energy bills. As expected, the governor killed two items, which would have required utilities in California to get at least a third of their energy from renewable sources by 2020, but with limits for how much of that goal they could meet with power generated out of state (at an Arizona solar farm, for example).

In Schwarzenegger’s view, those limits made the proposed laws overly “protectionist” and lacking in pragmatism, since development of renewable energy projects and transmission infrastructure within California has been relatively slow going. The governor’s veto last night, and the controversy over his executive order last month to have the California Air Resources Board (rather than the legislature) determine how utilities can meet the renewable portfolio standard, highlight a major choke point in the effort to clean up the national power supply: the approval process for transmission lines.

Policymakers, utilities and renewable energy developers at this point largely agree that the U.S., with its aging transmission infrastructure, is overdue for a grid upgrade. As we noted in a recent GigaOM Pro article (our subscription-only research service), to accommodate new renewable energy projects coming online the U.S. needs many more transmission lines, and California’s utilities commission estimates that no fewer than seven new transmission lines are needed to reach the 33 percent by 2020 goal.

Yet despite this support for investment in transmission, power lines are in many cases being built at a slower pace than renewable energy generation projects are being developed. Getting financing and a green light from government authorities to build a solar plant in the desert is one thing — winning approval for the entire length of a transmission line, which often runs through multiple cities, counties and states, including areas near people’s homes and businesses, is another animal entirely.

Building out new transmission lines requires coordination of multiple authorities, as Bob Anderson, managing director of the Western Grid Group, told us recently: “Landmass agencies, environmental regulators, energy regulators -– it’s just kind of a brawl.” And it touches the nerves of eminent domain and NIMBY-ism: Transmission lines may offer benefits to the country as a whole, but for the municipalities and landowners that have power lines running through them (without necessarily delivering energy along the way), they’re not too appealing.

These hurdles will continue to arise for the electricity that California utilities will continue to bring in from out of state (since they’ll inherently deal with interstate transmission lines). Now that Schwarzenegger has left the door wide open for energy imports, utilities can continue to purchase power from whoever makes it available at the most competitive rates. That’s the plan, at least, until Schwarzenegger leaves office at the end of next year — critics have said his executive order may not hold after that.

Photo credit NREL