By Mary Nichols

There is a major paradigm shift occurring in the way the Los Angeles Department of Water and Power (LADWP) runs its power system. After many years of relying on coal-fired power for at least half of its 7,200-MW generation capacity, the LADWP is pursuing an aggressivea renewable portfolio standard (RPS) to increase its supply of renewable energy from about 3% in 2005 to 20% of retail power sales by 2010.

This aggressive target, which was adopted by the LADWP Board of Water and Power Commissioners in 2005, dramatically accelerated the previous deadline of 20% by 2017. But the effort to expand the supply of renewable energy being served to Los Angeles residents and businesses goes far beyond the 2010 deadline. Beyond 2010, our interest in renewable energy will only continue to grow. I am proud to report that since the current Board was appointed in September 2005, we have more than doubled the percentage of renewable energy supplied to customers, and we are currently at 8%. Fulfilling the RPS mandate is the cornerstone of the City of Los Angeles’s commitment to becoming the cleanest, greenest big city in America. As the nation’s largest municipal utility, the LADWP has stepped up to lead this initiative, not only on behalf of the City of Los Angeles but as a model for public power agencies across the United States.

Los Angeles consumes approximately 10% of all electricity within California, and the LADWP owns or controls 28% of the state’s total capacity. The LADWP’s dominant use of energy resources and infrastructure heightens our responsibility to foster clean, renewable energy for Los Angeles and to set the example for other public power agencies.

The Rewards of Renewables
Today more than ever, we are recognizing the need to transition from fossil fuels to clean, sustainable, and renewable energy. Expanding the supply of such renewable energy sources as wind, solar, or geothermal power has tremendous benefits.

From an environmental standpoint, renewable energy sources produce few or no greenhouse gases or other polluting emissions. We can meet growing energy demand while improving the air we breathe and helping to slow and avert the worst impacts of global warming, which are costly and threatening to the quality of life in our community and on the planet.

By diversifying our sources of power-generation supplies nationwide, we can enhance energy reliability and stabilize costs. Many people have already forgotten that California’s 2001–2002 energy crisis was precipitated by a sudden spike in the price of natural gas. Renewable energy makes business sense as a hedge against volatile natural-gas prices and reduces the nation’s dependence on foreign sources of fuel. Furthermore, renewable resources are self-sustaining as long as the sun shines and the winds blow (just to give two examples).

When the Board of Water and Power Commissioners set the policy to accelerate the LADWP’s renewable energy standard, we anticipated the possibility that California legislators might take a bold step in capping the emissions of carbon dioxide and other greenhouse gases, as they did with the passage of AB32. Major investment in renewable energy will be required to meet the state’s regulatory goals, and the LADWP made a prudent business decision to get started on meeting its obligations.

The Balance of Power
There is no doubting that it is in the environmental and economic interest of the City of Los Angeles to shift the balance of power toward renewable energy. The question is: How do we get there while continuing to provide reliable energy at competitive rates? The temporal nature of some renewable energy sources (for example, how do you rely on harnessing wind energy when you need it?) is that this energy cannot be dispatched on demand. Furthermore, it will take a significant infusion of funds to develop new renewable energy resources along with the necessary transmission infrastructure to bring a reliable and sustainable supply to Los Angeles.

New transmission is essential to the RPS—creating the highways to carry clean, emission-free energy to Los Angeles. The LADWP owns or controls thousands of miles of transmission lines, but they are designed to access large, single-source generating plants in California, Utah, Arizona, Nevada, and the Pacific Northwest. Compared to the existing generating stations, renewable energy generation acts more like distributed generation. Renewable facilities are smaller and more scattered, requiring the need to identify new transmission paths that will access areas with high potential for renewable energy.

The LADWP is tackling these challenges on multiple fronts. Initially, the agency is seeking purchase agreements with companies that either have existing renewable power to sell or are able to develop new generating facilities and provide an ownership option for Los Angeles to meet the RPS by 2010.

Beyond 2010, however, we will need to develop renewable projects that can replace fossil fuels in providing “baseload” generation. One promising renewable resource is geothermal energy. Unlike wind or solar power, geothermal is available on demand twenty-four-and-seven, and therefore offers a high degree of reliability. We are fortunate that there is a rich supply of geothermal power in California and other parts of the West, still largely untapped and including an estimated 2,000 MW in the Salton Sea area of southern California, where the LADWP has purchased 5,800 acres of land.

The LADWP and the Southern California Public Power Authority (SCPPA), an agency that works on behalf of the LADWP and 10 other public power agencies, have issued three requests for proposals (RFPs) since 2004 that have generated more than 50 proposals for projects or purchase agreements. In January 2007, the LADWP issued a new RFP, with proposals due in April, for approximately 2,200 gigawatt-hours per year of energy. If this amount is realized, it will constitute about 9% of our 20% RPS goal.

The LADWP is giving preference to proposals that offer immediate facility ownership or to long-term purchase agreements that have an ownership option. While we are relying on purchase agreements to meet the goal of 20% by 2010, ownership is a key part of the LADWP’s renewable-energy strategy going forward. Through ownership, the agency gains control of renewable generation for the indefinite future, enabling us to control costs for our customers, control operating performance, and keep more jobs in-house. Ownership also helps ensure that we can sustain the RPS level of 20% over the long term.

Additionally, the LADWP is targeting proposals for renewable energy that would be constructed on LADWP-owned land located in the Mojave Desert or the Salton Sea area. The high desert area is considered an excellent location for solar trough or concentrated solar, while the Salton Sea area is rich with untapped geothermal resources.

Projects in the Pipeline
Currently, the LADWP has a long list of potential renewable energy projects or purchase agreements in the pipeline that will take us well beyond the 20% goal. These are as diverse as a 140-MW concentrated solar plant in the high desert area, a 200-MW geothermal power in the Salton Sea area, and four waste-to-energy plants (in partnership with the city’s Bureau of Sanitation) that will generate 100 MW by converting solid waste to energy in Los Angeles. Wind, concentrated solar, solar trough, and geothermal power constitute the majority of the proposals, but small hydroelectric (30 MW or less), biomass, and solid waste-to-energy are also in the mix. Other eligible renewable resources include biodiesel, digester and landfill gas, fuel cells that use renewable fuel, ocean wave or other ocean technologies, and solar photovoltaic.

Some of the specific projects or agreements that are completed or in development include the 120-MW Pine Tree Wind project, which we are currently building in the Tehachapi area north of Mojave, and long-term power purchase agreements for wind and small hydroelectric power.

One example is that of a 20-year contract with UPC Wind, which will provide Los Angeles with 185 MW of wind power from a 200-MW wind plant to be built in Millard County, UT. The LADWP and other agencies in the SCPPA will have the option to purchase the facility after 10 years.

We also have begun planning several new transmission systems or are expanding the capacity of existing ones. The biggest of these transmission projects is known as Green Path North. This 85-mile, plus- or minus-500-kV transmission line will connect a new electrical substation in Hesperia to the Devers substation near Palm Springs.

In many ways, the LADWP’s green power efforts have required a nearly 180-degree shift in institutional thinking. But what will not change is the LADWP’s long history of providing reliable power and water service at competitive rates to the 4 million people of Los Angeles or the pride we take in providing outstanding service and value to the people of this city. To quote Kermit the Frog, “It’s not easy being green,” but at LADWP we are proving that it can be both healthy and rewarding for our customers.

Mary Nichols is a member of the LADWP Board of Water and Power Commissioners.

DE - May/June 2007