New Renewable Energy Measure Could Increase UC Utility Bills

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As more solar and wind power makes its way into the state's energy sources, increased costs are also expected to make their way into the UC's pocketbook.

Last month, the California state Senate passed a bill that would require utilities companies to generate 33 percent of their energy from renewable sources - including solar, wind and geothermal energy - by 2020. The bill is now waiting for approval from the state Assembly, and if it passes there, it will move on to Gov. Jerry Brown's desk.

"You pay more for renewable energy, and that would definitely impact the University of California as a large utility customer," said Andy Coghlan, the UC sustainability specialist.

Renewable energy sources, which are derived from resources that can be naturally replenished, are generally endorsed as eco-friendly because they are not produced by burning fossil fuels. If utilities companies - like PG&E, from which UC Berkeley purchases its electricity and gas - begin to use more sustainable energy sources, UC utility bills could increase, as the majority of UC electricity is purchased from utilities companies.

The UC already struggles to pay its utilities bills. As state finances started to dwindle over the past 10 years, costs for the maintenance of buildings began to shift from the university - which has historically covered those payments with direct state funding - to individual campuses.

Currently, about $40 million of the university's annual utilities bill of between $280 million to $300 million for buildings that are eligible for state support is paid with campus monies, according to UC spokesperson Steve Montiel. Specifically at UC Berkeley, over $6 million in campus discretionary funds that would otherwise go toward research and teaching are used to pay for its approximately $26 million annual utility bill, according to campus spokesperson Dan Mogulof.

Neither the campus nor the UC is unfamiliar with price increases - since 2001, energy prices have risen 120 percent, according to Montiel. So keeping costs down has been difficult because even as usage decreases, total payments frequently stay the same or even go up because of the elevated rates. Coghlan said he hopes to work against the potential cost changes by continuing to conserve energy on campuses.

"We don't have to accept a higher utility rate and turn it directly into a proportionally higher utility bill," he said.

Both the UC and UC Berkeley have sustainability plans that include reducing greenhouse gas emissions. And since the proposed legislation would require more eco-friendly energy sources, it would bring them closer to their goals.

"Part of the carbon footprint of the University of California is the carbon net embedded in the electricity that we buy," Coghlan said. "So to the extent that the utility companies in the state have to buy renewable energy, that's going to lower the carbon intensity of the electricity and indirectly (and) it will help the university achieve its greenhouse gas emission goals."

The UC sustainability policy calls for a reduction of greenhouse gas emissions to 2000 levels by 2014. UC Berkeley has a more ambitious target; in 2007, Chancellor Robert Birgeneau made the commitment to bring down campus greenhouse gas emissions to 1990 levels by 2014. And since about 30 percent of campus emissions come from electricity usage, the bill would help further those ends, according to campus sustainability specialist Kira Stoll.

"If (utility companies) are using less coal and more solar, then our electricity has less greenhouse gas emissions in it," she said. "So there is a very strong connection between what our utilities are doing and our emission from the campus."

Most utilities companies in the state have already begun to use alternative energy sources because in 2006, the state passed a bill that required them to use 20 percent renewables by 2010. Similar policies are being passed in many other states, and more than half have already set renewable energy targets.

If oil prices continue to rise, renewable energy may not only be more environmentally friendly than oil, it also may be cheaper, said Ellen Hanak, an economist who specializes in natural resource management and a senior fellow at the Public Policy Institute of California.

"Our oil reserves are finite; at some point in the earth's future, we'll need to be completely independent of oil," she said. "A lot of innovation is needed to move us there, and California is in a position to be an innovator in this kind of thing."


Soumya Karlamangla is the lead environment reporter. Contact her at [email protected]

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