All Politics is Local: Should State or Local Government Approve Renewable Energy Projects?

Who should have primary authority to approve solar photovoltaic (“PV”) and other renewable energy projects not within the California Energy’s Commission’s (“CEC”) exclusive jurisdiction?  Certain interests, such as the utility-scale solar industry and independent energy producers, are in favor of the CEC permitting or having the option to permit such projects.  Other interests, including local government agencies, the wind industry, and the Sierra Club, strongly believe that the decision to site and approve these projects should be made by counties and local government.

This issue has taken on a new level of prominence with the introduction of AB 2075, a bill that would expressly strip the CEC of jurisdiction over solar PV projects and would eliminate a  code section that gives an option to applicants proposing energy “facilities” otherwise exempt from CEC jurisdiction to submit to the CEC’s exclusive jurisdiction.  Currently, the CEC has clear jurisdiction over solar thermal projects, but it is unclear whether Public Resources Code Section 25502.3 in fact authorizes CEC to agree to take jurisdiction over non-thermal energy projects such as solar PV plants.  The CEC claims that Section 25502.3 in fact does allow renewable energy powerplant proponents, including solar PV applicants, to submit to CEC jurisdiction, thereby bypassing local control over such projects.

There is a common view that the environmental review process marshaled by the CEC is less onerous and more predictable than the environmental review conducted by local government.  Local agencies and certain environmental groups believe that the CEC is not adequately protective of local interests and the environment, and that project applicants should not be able to “cherry pick” the regulator.  Those in favor of CEC jurisdiction argue that local control over energy projects can result in unpredictable permitting issues and impediments to achieving California’s 33% renewable portfolio standard (“RPS”) requirement by 2020.  For example, it is claimed that Riverside County has stalled on all its solar applications in retaliation for a trade association (the Independent Energy Producers) lawsuit attempting to overturn a new property tax on project sites.

Although the arguments surrounding this issue do not always hold up (a number of California counties have, for example, emerged as leaders in the development of renewable energy), both sides in this debate have a point.  On the one hand, local governments should certainly have a say in the land use of their domain.  On the other hand, the CEC is our state’s energy expert and is perhaps better situated to help meet California’s hefty RPS mandate.

At the end of day, although AB 2075 could potentially bring greater clarity to renewable energy permitting processes, perhaps the status quo is not all that dysfunctional.  Most renewable energy applicants will likely still go to the local government for project approval, and the local government will likely conduct an appropriate review of the project.  However, if local government politics unduly interfere with the processing of a particular project, the CEC can be an appropriate escape valve.  Given the statewide 33% RPS, a permitting process that helps route around local political tit-for-tat is not necessarily a bad thing.