Comment Log Display

ARB has an admirable goal of protecting ratepayers from costs
associated with the proposed cap and trade regulation.  However,
ARB has proposed a complicated scheme of providing free allowances
to utilities to offset increased costs they will bear from
electricity generation facilities like cogeneration plants. 
Unfortunately, this puts a significant and unnecessary
administrative burden on electricity generation facilities like
cogeneration, who now must determine the allowances they will need,
track and participate in auctions, determine what costs can be past
on the utility, and assess if this mechanism provided adequate
reimbursement for them to keep their operation going. These
represent real administrative actions and costs these facilities
must bear.  Today, nobody performs these actions at these
facilities, adding a new layer costs to an industry with low
margins.  It would be much better to develop an approach that does
not create additional administrative activities so that new costs
are minimized in achieving the goal of protecting the ratepayer. 
Toward this end, we propose that ARB provide allowances directly to
the electricity generating facilities like cogeneration.  By doing
so, these facilities will know what allowances they will receive;
costs will be minimized by removing the entity in the middle
(utility) without changing the number of allowances distributed;
and facilities will have greater clarity of their needs and costs
under the proposed cap and trade regulation.  Helping us minimize
the costs of this regulation will allow us to continue providing
efficient electrical generation to the state of California.  This
is something that we hope the ARB can seriously consider and engage
in further discussion with groups like the California Cogeneration
Council and the utilities.