With electricity in California in short supply during recent months, it is easy to overlook the boom in power plant construction that has already started. Since April 1999, the California Energy Commission has approved nine plants capable of increasing the state's generating capacity by 12%. And, the commission is reviewing 14 more proposals that would add another 12% to the state's generating abilities, bringing the capacity to about 67,000 megawatts. This building boom causes some analysts to predict the state will become a net exporter of electricity within two years. Still, policy makers of all stripes are urging speedier reviews of new power plants, and some – led by the new Bush Administration – have called for relaxing environmental protections. A bill providing up to $5 billion for the state to purchase and build power plants (SB 6X, Burton) was advancing through the Legislature in late February, as did other bills related to power plants. A new Energy Commission study of 32 potential locations for "peaker plants" could aid the process of the state itself building power plants, according to a commission official. Surprisingly, most of the recently approved and proposed power plants have met little local resistance. Four of the nine already approved projects are in remote areas of Kern County, where the oil and natural gas industries already have a strong presence. And several mainstream environmental organizations have welcomed new gas-fired power plants because they create electricity more efficiently than older models. Still, some proposals have hit local obstacles, notably proposals in San Jose's Coyote Valley, in the Los Angeles suburb of South Gate, and in Huntington Beach. A One-Year Process In 1974, the Legislature passed the Warren-Alquist Act, which created the State Energy Resources Conservation and Development Commission, commonly known as the California Energy Commission. The legislation (Public Resources Code § 25000 et seq.) gives the Commission sole authority to certify construction and operation of thermal electric power plants of at least 50 megawatts. Projects undergo an environmental review (the document is often called a Final Staff Assessment) that is similar to the process mandated by the California Environmental Quality Act. Before issuing a license, the Energy Commission must also assure that the plant will comply with state and regional regulations, including often-stringent air quality mandates. The commission is not bound by local zoning or decisions of local officials. But in practice, the agency often places great weight on local laws and likes to see support from local authorities, according to John C. Funk, an attorney with Weston, Benshoof, Rochefort, Rubalcava & MacCuish in Los Angeles. Kern County Planning Director Ted James said the Energy Commission has asked local planners to comment on projects and review environmental documents for new power plants in his county. "It's positive that the state is communicating and coordinating with us," James said. "Our arrangement — and it's worked very well — is that they [CEC staff members] contact us and work with my staff on the local issues." Once the Commission determines an application to construct a power plant is complete, the agency has one year to decide on the project. Legislation approved last year (SB 970, Ducheny) shorted that timeline to six months for power plants of fewer than 100 megawatts that present no significant environmental impacts. "Peaker plants" that would operate limited hours during high-demand periods through 2003 receive a four-month review under the legislation. An Executive Order issued in February by Gov. Davis extended the four-month review process to peaker plants for which an application is filed this year. And peaker plants that can be online by July 31 are eligible for 21-day emergency processing procedure. However, few project proponents have taken advantage of the shorter process, according to Rob Schlichting, an Energy Commission spokesman. El Paso Merchant Energy Company's 51-megawatt plant at San Francisco International Airport underwent the four-month process (actually closer to five months), and the 99-megawatt Hanford Energy Park Project in the Kings County town is in the six-month process. Mixed Receptions Kern County has proven popular with power plant developers because it already has extensive oil and natural gas production, according to James. Many of those extraction facilities have co-generation plants, so construction of a full-fledged power plant is a logical next step. Plus, the California Aqueduct runs through the county, so water is available for plant cooling, and Kern County is fairly close to major urban centers, James added. Thus far, the Kern County projects have spurred only light opposition. "We're seeing groups like the Sierra Club and the Audubon Society asking questions about how many do we want in one area?" said James. He added that the documents he has reviewed indicated Energy Commission has fully addressed questions regarding air quality and cumulative impacts. The proposed Metcalf Energy Center in south San Jose provides a different example, and it demonstrates how odd the politics of power plant development can be. The Sierra Club and the American Lung Association have endorsed the project, while big business, in form of Cisco Systems, opposes it. In 1999, Calpine Corporation, which has become a major supplier of energy in California in the last few years, and Bechtel Enterprises announced plans for a 600-megawatt, gas-fired power plant on 14 acres in San Jose's Coyote Valley. The site was chosen because it is less than a mile from a high-pressure natural gas line, and because the power plant could tie in with an existing 230 kilovolt transmission line less than 500 feet away. But Cisco, which won approval last year for a 6.6-million-square-foot campus near the proposed power plant site, came out strongly against the power plant. Cisco said the facility would harm local air quality and was an inappropriate industrial use in an area long envisioned as a site for technology business growth. San Jose Mayor Ron Gonzales sided with Cisco, and in November 2000, the City Council unanimously denied Calpine's general plan amendment and rezoning applications. Since then, pressure has mounted on the Energy Commission to override the city's decision. State Senate President Pro Tem John Burton has endorsed the project, as have five Democratic Assembly members from the South Bay, and the Santa Clara County Board of Supervisors. Calpine and backers insist no basis exists for opposing the power plant. They point to a Bay Area Air Quality Management District analysis that found the power plant would have a negligible impact on air quality. Calpine has even offered to build an air monitoring station at any location and agreed to shut down should the plant exceed standards, said Lisa Poelle, a spokeswoman for Calpine/Bechtel Joint Development. "This has become the premiere poster child for NIMBYism anywhere in the country because Cisco is so powerful," Poelle said. "Cisco got the mayor to back them on us, and the City Council followed his lead." Rich Ferguson, California energy chair for the Sierra Club, said opponents of any thermal generating plant always raise air pollution concerns. In the case of the Metcalf Energy Center in San Jose, he said, those concerns are overstated. "Our data, the Lung Association's data and the local air quality district's data do not show that [air pollution] as an issue. We found that traffic to and from the new Cisco campus would create far more air pollution impacts," Ferguson said. But Elizabeth Cord, president of the Santa Teresa Citizens Action Group, a neighborhood organization, argued that the public health risk assessment for the plant is inadequate. South San Jose already has the worst air quality in the Bay Area because of prevailing winds and the narrowness of Coyote Valley, she said. Her viewpoint received backing in mid-February when a group of meteorologists from the Naval Postgraduate School in Monterey questioned the atmospheric modeling used by Calpine and the air district. The City of Morgan Hill, a project opponent about seven miles south of the site, commissioned the meteorologists. "I think there could well be within San Jose and Santa Clara County appropriate sites for power plants," said Cord, whose organization supported the controversial Cisco campus. "I think the way things are going, we would be happy to have some power generation. But this isn't the right site." Four hundred miles to the south, Sunlaw Energy's proposal to build a 550-megawatt power plant in South Gate his run into major local opposition. The 13.5-acre site near the 710 Freeway is now a truck depot. It lies in a heavily urbanized community populated primarily by non-English speaking residents, said the Energy Commission's Schlichting. Thus, environmental justice concerns have come to the forefront. The City of South Gate has placed on the March 6 ballot an advisory measure on the power plant. Although the Energy Commission is continuing with its review process, Sunlaw officials have suggested they would abide by the results of the non-binding advisory vote because they do not want to build where they are not wanted. Speeding the Process President Bush's first official response to California's energy situation was to call for relaxing federal environmental regulations. And in mid-February, Bush ordered agencies such as the Environmental Protection Agency and the National Marine Fisheries Service to "expedite federal permit approvals for siting and operating power plants in California." Bush's action came at the request of Gov. Davis, who in early February issued six Executive Orders and introduced a legislative package. Among other things, the executive orders offered a bonus to developers who bring new plants on line by July, directed the California Air Resources Board to establish a State Emissions Offset Bank, and allowed generators to maximize output and pay mitigation fees if necessary. The legislative package includes rebates and tax incentives for generators of renewable energy; loans for businesses that build on-site generating facilities such as solar-powered cells or co-generation plants; and money for water districts to convert diesel generators to natural gas technology. "We'll demonstrate that California can cut red tape, build needed energy supply, and maintain our respect for the environment," Davis said during a February news conference. The governor also appointed Larry Hamlin, vice president of power production, operations and maintenance services for Southern California Edison, as the state's "energy construction czar." Hamlin took a two-month leave from Edison to "ride herd on every single project," Davis said. Davis and the Legislature's majority Democrats appear to have left behind Republican lawmakers. They have suggested building power plants on active and closed military bases, letting local government keep all property tax revenues from new power plants, and giving the governor emergency authority to approve new generating facilities. Republicans have also jumped on the electricity crisis as a way to champion a new round of dam building. Sen. Tom McClintock (R-Thousand Oaks) has even urged the proposed public power authority to acquire and reopen Rancho Seco nuclear power plant, which the Sacramento Municipal Utility District closed about 10 years ago. Republicans have also urged the Energy Commission to issue swift approvals to projects in Huntington Beach and Morro Bay. Many people, including some power generators, say that environmental regulations are really a straw man. They say that no one built any power plants in California for 10 years because of market conditions. State Energy Commission officials are quick to point out that they have approved every plant proposed during the last decade, several of which were never built. An unusual coalition of labor and environmental groups urged Davis and the Legislature not to reduce environmental protections. Nine power plants received Energy Commission approval under the existing system, so there is no reason to alter the system for the benefit of future developers, said Sharon Cornu, of the California Labor Federation. The City of Huntington Beach has also questioned ramifications of speedier permit processing. On orders from the governor, the Energy Commission has implemented a 60-day process for approval of refurbishment and reactivation of two old gas-fired generators owned by AES Corporation. But Huntington Beach Mayor Julien Houchen told the Los Angeles Times, "The people and environment of Huntington Beach are in jeopardy as this train races down the track." Environmentalists say they are not to blame for the 1990's dearth of power plant development. The Sierra Club's Ferguson said the latest technology makes new plants cleaner and more efficient. "Basically, the argument is that if you don't build the new stuff, the old stuff will keep running," he said. Contacts: Ted James, Kern County Planning Department, (661) 862-8600. Lisa Poelle, Calpine/Bechtel Joint Development, (408) 792-1285. Rich Ferguson, Sierra Club, (916) 447-7983. Sharon Cornu, California Labor Federation, (415) 986-4003. California Energy Commission website: www.energy.ca.gov Santa Teresa Citizen Action Group website: www.santateresacitizen.org
