The high future cost of being green in California

It's not easy being green.

It’s not easy being green.

Californians already pay some of highest rates for electricity in the U.S., but that’s nothing compared to what the future holds as we push as hard as we can to get as green as we can.

Residential electricity rates in California increased 30 percent between 2006 and 2012 after adjusting for inflation, according to the U.S. Energy Department. But hold on, there’s more coming.

Energy and Environmental Economics, a San Francisco consulting firm, projects that the cost of electricity will increase 47 percent over the next 16 years, primarily because of California’s shift to more expensive renewable energy and heavy investments in transmission lines.

“Everywhere you turn, there are proposals and regulations to make prices go higher,” Daniel Kish, senior vice president of the Institute for Energy Research, told the Los Angeles Times. “The trend line is up, up, up. We are going into unchartered territory.”

California has the nation’s most aggressive mandate for renewable power. Major utilities must obtain 33 percent of their power from renewable sources by 2020, and that doesn’t include hydropower from Sierra Nevada dams.

Renewable power will require the use of more wind and solar energy. Since those sources depend on the weather, they require backup generation–a hidden cost that makes renewable power less attractive to rate payers.

California has all but phased out coal-generated electricity. The state lost the output of San Onofre’s two nuclear reactors and–at a time when the U.S. in drowning in natural gas–will shut-down 19 gas-fired power plants along the coast by 2020 because of new state-imposed ocean water rules.

“Our rates are increasing because of all of these changes that are occurring and will continue to occur as far out as we can see,” said Phil Leiber, chief financial officer of the Los Angeles Department of Water and Power. “Renewable power has merit, but unfortunately it is more costly and is one of the drivers of our rates.”

Our zeal to be green could trigger a counter-revolution. In the words of Alex Leupp of the Northern California Power Agency:

“If power gets too expensive, there will be a revolt. If the state pushes too fast on renewables before the technology is viable, it could set back the environmental goals we all believe in at the end of the day.”

But until that revolution happens, you had better keep your wood-cutting ax sharp and ready to go. Until, of course, all home fires are outlawed for polluting our pristine, but frigid, air.

This entry was posted in Economy, Eneregy, Environment, Government, Politics, Public Policy. Bookmark the permalink.

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