The California-DOI MOU complements and expands on several MOUs issued over the past year to establish and outline the activities of the California Renewable Energy Action Team (REAT). The REAT was provided for in California Executive Order S-14-08, issued November 17, 2008, to “establish a more cohesive and integrated statewide strategy, including greater coordination and steamlining of the siting, permitting, and procurement processes for renewable generation … .” In other words, let’s dispense with the permitting hang-ups and delays that plague development projects in California and get more renewable energy facilities online.  While Executive Order S-14-08 does not focus on the development of solar energy in particular, this MOU is geared to faciliting California's burgeoning solar energy industry.

The recent MOU between California and Interior reiterates several tasks of the REAT provided for in S-14-08 and the Energy Commission-Fish and Game MOU:

• For U.S. Fish and Wildlife and California Fish and Game to identify renewable energy zones (REZs), as part of the Desert Renewable Energy Conservation Plan (DRECP), based on renewable energy development potential, environmental, wildlife, and conservation criteria.
• Develop a conservation strategy by identifying areas most suitable for renewable energy development and for regional multispecies and habitat conservation.
• Complete a draft DRECP by December 31, 2010 and a final DRECP by June 20, 2012.
• Aside from the Mojave and Colorado Desert areas covered in the DRECP, identify and publish top priority areas in California where other Natural Community Conservation Plans or similar plans may be developed, based on their renewable energy development potential.

The MOU also draws together several activities of the state and federal agencies, including BLM’s programmatic environmental impact statement for solar energy development (Solar PEIS), the DRECP, and the Best Management Practices manual to assist renewable energy project applicants in designing projects. In fact, the MOU places a sharp emphasis on solar energy, making it a “high priority” to process applications for solar development in “any areas deemed most appropriate,” areas identified as solar energy zones in the BLM Solar PEIS, REZs identified in the DRECP, and areas identified by the Renewable Energy Transmission Initiative. The MOU also calls for the parties to place a high priority on processing applications and permitting for transmission upgrades needed to serve these areas. Though the MOU was signed on October 12, 2009, by September 30, 2009, the parties were to have identified “interim guidelines to assist solar project developers to design and site projects in an environmental suitable manner.” 

This all ties back to an MOU signed in 2007 by BLM and California Energy Commission on joint environmental review of solar thermal projects on BLM land. The MOU outlined the BLM and Energy Commission environmental review processes under the National Environmental Policy Act and the Warren-Alquist Act, respectively, and how the two would overlap to create a cooperative process. The obvious advantages include sharing staff expertise and information, avoiding duplication of staff efforts, and facilitating public review by holding joint public meetings, issuing joint public notices, and producing a joint environmental document.

• California Air Resources Board:  Preliminary Draft Staff Proposal on Recommended Approaches for Setting Interim Significance Thresholds for Greenhouse Gases under CEQA 
• California Office of Planning and Research:  Proposed Amendments to CEQA Guidelines
• California Air Pollution Control Officers Association:  White Paper on CEQA and Climate Change
• South Coast Air Quality Management District:  Interim CEQA GHG Significance Threshold for Stationary Sources
• San Joaquin Valley Air Pollution Control District:  Draft Staff Report on the Climate Change Action Plan: Addressing GHGs under CEQA 
• Association of Environmental Professions:  Alternative Approaches to Analyzing GHG Emissions and Global Climate Change in CEQA Documents 

There have also been a handful of court decisions, providing us a bit of insight into how to effectively treat climate change impacts under CEQA. 

• Sierra Club v. City of Tulare (case no. 08-228122, Tulare County Sup. Ct., March 16, 2009)
• Center for Biological Diversity v. City of Desert Hot Springs (case no. RIC464585, Riverside Sup. Ct., Aug. 6, 2008)
• Environmental Council of Sacramento v. California Department of Transportation (case no. 07CS00967, Sacramento Sup. Ct., July 15, 2008)
• Center for Biological Diversity v. County of San Bernardino (case no. BCV09950, San Bernardino Sup. Ct., April 11, 2008)
• Murrietans for Smart Growth v. City of Murrieta (case no. RIC463320, Riverside Sup. Ct., Nov. 30, 2007)

Recently, San Bernardino Superior Court issued a ruling in Center for Biological Diversity v. Town of Yucca Valley (case no. CIVBS 800607 and 810232, May 14, 2009), with potentially important implications for handling in an environmental impact report (EIR) the devilishly tricky analysis of a project’s cumulative impact on climate change. 

While definitive agency guidance and regulations are being developed, EIR drafters have been left wondering, how does one incorporate enough mitigation to be able to conclude that a project will not have a significant cumulative impact on climate change? Many projects have relied on incorporating recommended GHG emission reduction measures from the California Attorney General’s Office and the California Climate Action Taskforce as mitigation for GHG emission impacts, and even to conclude that a project will not a significant cumulative impact on climate change. 

The Center for Biological Diversity v. Town of Yucca Valley case addresses the Town's reliance on the Climate Action Taskforce (CAT) GHG emissions reduction measures to find that a proposed Wal-Mart Supercenter would have a less than significant impact on global climate change. Judge Plotkin’s minute order, adopting his tentative ruling in the case, does not go into detail on how to handle a climate change cumulative impact analysis. What can we gleam from this concise opinion? Reliance on the CAT recommendations for emission reductions, to conclude that a project’s cumulative global climate change impact is less than significant, does not violate CEQA Guidelines § 15064(h)(3). However, the Town of Yucca Valley was nevertheless ordered by the Judge to revise the EIR’s cumulative global climate change analysis. In sum, the Town’s findings that the project complied with all applicable CAT strategies for emission reductions was not supported by substantial evidence. In addition, in discussing the project’s cumulative impact, the EIR ignored the scientific and factual analysis by the California Air Pollution Control Officer Association regarding attainment of California’s GHG emission targets. The EIR also failed to consider the entire GHG emissions output for the project.

All of our questions on CEQA and GHG emission won't be answered until there is much more local and state agency direction, and perhaps additional judicial guidance.  So stay tuned . . .

Over 13,000 facilities nationwide, accounting for about 85% to 90% of GHGs emitted in the U.S., will be required to report their emissions under the rule.  Reporting will largely be done on a facility-level, with the threshold for mandatory annual reporting based on facility capacity, rather than emissions.  Where a capacity threshold is not feasible or appropriate, facilities that emit 25,000 metric tons or more of GHGs per year will be required to submit annual emissions reports.  Data collection will begin January 2010, the first reports due in March 2011. EPA estimates that the cost to all industries to comply with the new reporting requirements would be $160 million in the first year, and $127 million annually in subsequent years.

The rule was published in the Federal Register on April 10, and comments on the rule are due to EPA no later than June 9, 2009. 

• was arbitrary and capricious in its finding that its proposed standards are in the aggregate at least as protective of public health and welfare as applicable federal standards,
• does not need such standards to meet compelling and extraordinary conditions, or
• has proposed standards not consistent with section 202(a) of the Clean Air Act.

In denying ARB's original waiver request, the EPA administrator at the time, Stephen Johnson, noted that President Bush had just signed an energy bill that would work to reduce emissions throughout the U.S. and that increased fuel economy standards.  The energy bill increased fuel efficiency for new cars and light trucks by 40% by 202, to an average of 35 mpg.  This is in fact the biggest increase by Congress in fuel economy standards since the program was created in 1975.  As Johnson announced in December 2007, "The Bush administration is moving forward with a clear national solution, not a confusing patchwork of state rules."  It's true that if the waiver is granted, California would enact a more stringent fuel economy standard than in any other state.  But, 16 other states have pledged that if California can move forward with its higher standard, they would in turn adopt California's standard as their own. 

Executive Order S-14-08 calls for California to get 33% of our electric energy from renewable sources by 2020. The current Renewable Portfolio Standard (RPS), instituted in SB 107 in 2006, requires that 20% of California’s power come from renewable sources by 2010. Unlike the current RPS, the Governor's new target applies to both investor-owned utilities and public utilities.  A recent ballot initiative in California, which would have applied California's RPS to public utilities, failed on November 7th, after being opposed by a broad coalition of environmental groups and renewable energy industry groups.  The Governor says he will propose legislation that will codify the 33% RPS for all retail sellers of electricity.

The Order also implements an MOU signed yesterday by the California Energy Commission (CEC), the California Department of Fish and Game (DFG), the U.S. Bureau of Land Management (BLM), and U.S. Fish and Wildlife Service.

Starting in February 2009, renewable energy projects should enjoy a streamlined project approval process before a special joint unit of DFG and CEC. But exactly how will these two agencies “immediately create,” as the Order directs, a one-stop process for permitting renewable energy generation power plants? For thermal power plants over 50 MW, including geothermal and solar thermal facilities, the CEC already is, supposedly, the one-stop shop. 

The Executive Order does not propose any of the details for this streamlined permitting process, though it’s apparent that the Governor is looking to smooth one huge wrinkle for renewable energy development in the Mojave and Colorado Desert regions – protected species. DFG and CEC are directed to develop a Desert Renewable Energy Conservation Plan (DRECP) in these regions which will identify areas for renewable energy project development and areas intended for long-term conservation. The DRECP will provide long-term endangered species permit assurances to developers and facilitate approval of desert projects. The presence of protected species and habitat has been one of the biggest sticks that project opponents have to wield against desert projects, but the DRECP will potentially take that contentious element out of the mix. For city/county-permitted projects, like wind and solar PV, shortening the process to obtain a DFG incidental take permit certainly wouldn’t hurt.

State agencies are also directed to work with the feds on various initiatives, to get federal agencies on board with this approach. After all, within California about 80% of the Mojave Desert and over 50% of the Colorado Desert is managed by BLM or other federal agencies. The Governor is powerless to direct the federal agencies with responsibility for the protection of federal threatened and endangered species to do anything, but if state agencies coordinate with federal entities in developing the DRECP and other renewable energy initiatives, the federal agencies will hopefully be friendly allies in the new process.

The Western Renewable Energy Zone initiative and the Renewable Energy Transmission Initiative are also encouraged, with the Governor calling for various avenues of cooperation between the CEC, the California Public Utilities Commission, and the California Independent System Operator within these programs.

California is going full steam ahead with AB 32, and also SB 375, which implements a variety of land use and planning requirements and incentives to encourage urban development, decrease vehicle miles traveled, and ultimately reduce greenhouse gas emissions.  Meanwhile, Governor Schwarzeneggar is also planning for the worst case scenario. Executive Order S-13-08, released on October 14, 2008, addresses planning for the probable effects of climate change. The Executive Order makes the case that “the longer that California delays planning and adapting to sea level rise the more expensive and difficult adaptation will be.” This may sound like commonsense, but it’s also demonstrated by the numbers. As the Order points out, “billions of dollars in state funding for infrastructure and resource management projects are currently being encumbered in areas that are potentially vulnerable to future sea level rise.”

The Order tasks a conglomeration of state agencies with coordinating the preparation of a Sea Level Rise Assessment Report by December 2010. In the interim, all state agencies planning construction projects in vulnerable areas have to consider “a range of sea level rise scenarios for 2050 to 2100.” The vulnerability of a project must be assessed, and the agency must reduce risks and increase resiliency to sea level rise to the extent feasible. An agency is off the hook for this additional analysis if it has already issued a Notice of Preparation for an environmental impact report under the California Environmental Quality Act, or a project is programmed for construction funding in the next five years. 

The requirements of the Order do not bleed over into private development, but one has to wonder . . . will this additional level of analysis next be shifted to the private developer who proposes a project in a vulnerable coastal area? This would mean another layer of data to incorporate into a project’s environmental review, including information on local uplift and subsidence, coastal erosion rates, predicted higher high water levels, and storm surge and storm wave data. What would it take to reduce the risks associated with sea level rise for a project your company would like to undertake on the coast? How would you increase the project’s “resiliency” to sea level rise? We can’t put everything in the coastal zone on stilts, but what could be required of an individual project?

I know I’ll be looking for notice of the public workshop on the Sea Level Rise Assessment Report that has to take place before the end of next March.

·         The Department of Water Resources will coordinate a water adaption strategy, with help from the State Water Resources Control Board. 

·         The Ocean Protection Council is responsible for an ocean and coastal resources adaptation strategy.

·         Caltrans will work on an infrastructure adaptation strategy.

·         Fish and Game and State Parks are in charge of the biodiversity adaptation strategy

·         The working landscapes strategy will be a joint effort by the Department of Forestry and the Department of Food and Agriculture.

·         And, last, but not least, a public health adaptation strategy will be coordinated by the Department of Public Health and the Air Resources Board. 

In addition, the Office of Planning and Research and the Resources Agency must provide state land-use planning guidance related to sea level rise and other climate change impacts by May 2009.

• Energy efficiency
• Water efficiency and conservation
• Use of recycled and sustainable materials in construction
• Recycling of construction waste
• Indoor air quality

The Green Building Standards Code contains numerous optional green building measures, but some standards will soon be mandatory for all new buildings constructed in California.  For example, beginning about January 2011, at least 50% of construction waste generated at any given construction site must be recycled or salvaged.  Starting in July 2011, indoor water use must be reduced by 20%, for instance by using water saving fixtures and flow restrictors.  Low or no-volatile organic compound adhesives, paint, carpet, and other materials will also be mandatory in 2011. 

The mandatory and recommended green building standards in the Green Building Code could have a significant positive impact on energy consumption, water and resource use, and waste generation, considering the amount of resources associated with buildings in the U.S.  The U.S. Green Building Council notes that buildings nationwide account for 70% of electricity consumption, 39% of energy usage, 12% of potable water consumption, 40% of raw materials usage, and 30% of waste output.  The U.S. Green Building Council is the developer of the LEED (Leadership in Energy and Environmental Design) Green Building Rating System, which is considered the leading global standard on sustainable green building and development practices.

Recognizing these challenges, and as part of our commitment to the growth and success of the renewable energy industry, Stoel Rives developed its first Law of ... publication in 2003. We now introduce Lex Helius: The Law of Solar Energy, the newest installment in our continuing efforts to provide easily accessible information for individuals and companies interested in growing U.S. renewable energy resources. This guide contains insights we have gained from practical experience assisting participants in numerous solar photovoltaic projects covering a diverse range of sizes and installations, as well as from 15 years of experience serving the U.S. renewable energy industry.

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