CALIFORNIA WILL TAKE NEW ENERGY FROM ANYWHERE

Debating Protectionism on Renewable Energy
Kate Galbraith, September 16, 2009 (NY Times)

"One of the most notable elements of Gov. Arnold Schwarzenegger’s executive order on Tuesday increasing California’s renewable energy requirements was his blunt stand against protectionism. Clean energy imported from other states was welcome, the governor said, to keep down electricity prices."

[California Governor Arnold Schwarzenegger:] “I am totally against protectionist policies because it never works…You have to understand that we get our water from outside California. We get it from the Colorado River, for instance. Why can we get the water from the Colorado River but we can’t get renewable energy from outside the state? We get most of our cars from outside the state; why can’t we get renewable energy?”

It's a matter of trade-offs. (click to enlarge)

"Mr. Schwarzenegger’s stand — taken in response to bills in the California state legislature that would also have boosted requirements for solar, wind and other renewable resources but required a large amount of the generation to come from within California — seems bold for a politician. It also contrasts with the explicit encouragement given to in-state production in some other states’ renewable energy requirements, which are seen as a job-creating mechanism (although, of course, California has used other incentives to subsidize solar power growth in-state)."

Lose jobs, keep power prices down. (click to enlarge)

"Ohio, for example, requires half of its renewable energy mandate to be met with in-state production…Other states are more subtle…perhaps partly to avoid problems with the Constitution’s commerce clause in relation to interstate transactions…[States may] apply a multiplier to renewable energy certificates produced from in-state resources…Colorado and Missouri have a 1.25 multiplier for in-state resources in their renewable energy requirements.

"…[P]olicy makers see an important rationale for guarding local renewables [to protect growth and development]…[But the] threat of renewable energy imports can also help get competitive juices flowing. Northeastern policy makers are worried about proposed wind-power transmission lines from the Midwest…because they might lose out on jobs…[But it has stimulated the Northeastern wind and transmission industries]…"