Alternative-Energy Firms Scramble for Grant Money

Mainstream utility companies aren’t the only ones scrambling to figure out their role in California’s deregulated utility market.

Legislation passed by the state last year to open California’s electric market to competition in 1998 has sent many smaller alternative-energy companies into a frenzy over a provision that offers $540 million in grants over four years. The money, to be collected from investor-owned utilities, is meant to boost the prospects of the alternative-energy companies amid increased competition. These firms have typically been hampered by the relatively high cost of the energy they sell.

The money, which has attracted out-of-state firms to California, has spurred high-profile lobbying and public relations campaigning by solar, wind, geothermal and other alternative-energy companies.

This week, for example, the second annual Clean Energy Day on the Capitol grounds featured a variety of small energy companies plugging their services in a carnival-like atmosphere complete with jazz combos and ice cream giveaways.

The focus of the lobbying efforts are concentrated on two bills by Sen. Byron Sher (D-Palo Alto). SB 90 would parcel out the $540 million, and SB 1305 would require utilities to disclose the source of their energy.

The California Energy Commission, which will handle the grant process, has recommended that the money be divided partially along these lines: $54 million to existing solar-energy companies, $243 million to other types of existing renewable energy companies and $162 million to start-up companies.

SB 90, still pending before the Senate Appropriations Committee, currently contains few specifics on divvying up the money, leaving lawmakers and industry plenty of room for negotiation.

SB 1305 is headed for a vote by the full Senate. Alternative-energy advocates hope its requirements will build demand among consumers who prefer renewable energy sources despite their often higher cost.

“If people see their house is being powered by nuclear energy or fossil fuels, some of the more ecologically minded customers might opt for renewable [energy] instead,� said Julie Blunden of Vermont-based Green Mountain Energy Resources, which intends to set up shop in California’s deregulated market.

Hot Bills

* Sick Leave Options

Bottom Line: The California Labor Federation is pushing legislation that would let employees use sick leave to care for a sick family member living in their household.

Chances: Despite opposition from business interests, the bill was passed by the Assembly by a 46-25 vote on Monday. The bill cleared the Assembly after it was amended to drop language that would have permitted an employee to use sick leave to care for any sick person in the house.

Next Step: Senate hearing

Details: AB 480 author Wally Knox (D-Los Angeles) can be reached at (916) 445-7440.

* Newspaper Sales Tax Repeal

Bottom Line: Newspapers want the state to repeal the sales tax that was imposed on them in 1991 in part to make up a $14.5-billion state budget deficit. The California Newspaper Publishers Assn. argues the tax is unfair because it applies only to the 105 largest daily papers.

Chances: Gov. Pete Wilson has promised to sign the newspaper tax repeal if the industry can shepherd the bill through the Legislature. On Wednesday, the Senate Revenue and Taxation Committee passed the bill with the condition that the author find a way to make up the $80 million annual loss.

Next Step: June hearing, Senate Appropriations Committee

Details: SB 1300 author Charles Calderon (D-Whittier) can be reached at (916) 327-8315.

*

Comments about Capitol Matters can be sent via e-mail to [email protected]