The Environmental Charge (EC) was put into place at the request of customers to show the costs associated with environmental compliance. The costs included in the EC are primarily the costs for the Tuolumne Wind Project (TWP), along with costs related to greenhouse gas reduction (links to Climate Change under About TID-Environment). Compliance requirements are outlined in regulations resulting from SB107 (Renewable Portfolio Standard) which was approved in 2006 and in November 2008, Executive Order S-14-08 (signed by Governor Arnold Schwarzenegger ) requiring all retail sellers of electricity to serve 33% of their load with renewable generation by 2020. The 33% standard was ultimately codified when Governor Brown signed SB2(1x) into law on April 6, 2011. Also, Assembly Bill 32 (AB32) requiring a reduction in greenhouse gas emissions by 2020, which was signed by Governor Schwarzenegger in 2006.
Yes, TID has always complied with environmental laws. However, the legislation passed since 2006 has required a substantial investment in renewable generation. The major investment was the Tuolumne Wind Project (TWP) purchased in mid-2009. The cost for the project has never been included in the primary energy charge seen on the bills. Instead, TID has been collecting the cost for operations and interest on loans through the Power Supply Adjustment (PSA) CHARGE(link to Power Supply Adjustment under Power Rates and Rules), as was appropriate until TID conducted a rate hearing on the increase costs (which happened in 2011).
In 2011, when TID held public meetings about a pending rate increase, customers strongly urged TID to have a separate line item showing the costs associated with the TWP and other environmental regulations as they might arise. TID studied this issue and proposed to remove the cost of the TWP out of the PSA and add an Environmental Charge line item. The Board held a public hearing on the topic on November 22, 2011 and ultimately approved the proposal on December 6, 2011 to be effective February 1, 2012.
The environmental charge was established to comply with SB107 and currently SBX1-2 (Renewable Portfolio Standard) – requires retail sellers of electricity shall serve 33% of renewables by 2020. Also, Assembly Bill 32 (AB32) requiring a reduction in greenhouse gas emissions by 2020, which was signed by Governor Schwarzenegger in 2006.
Since the costs associated with the Environmental Charge are a result of California law, TID must comply with them. TID is a public utility in which all costs are distributed through our customers. These costs are necessary for all customers; therefore all customers must pay the charge.
Unfortunately, California Legislation does not allow hydroelectric plants generating more than 30 megawatts to count towards TID’s Renewable Portfolio Goal.
Rate increases, including the Environmental Charge, are accomplished through a public rate hearing process. TID informs all customers through billing inserts and newspaper notices of pending rate hearings. During a rate hearing all members of the public are invited to speak. Those who cannot attend may submit written notice of their position on the rate increase. All comments become part of the public record and are considered by Board of Directors. The Board of Directors (a locally elected body), then makes the final decision on rate increases.
The Environmental Charge was approved by the Board as a three-year phased in rate increase. In 2012, the effective charge is set at $0.0191/kilowatt-hour (kWh), $0.0252/kWh in 2013 and $0.0269/kWh in 2014. The Environmental Charge may change after 2014, depending on changes to the law and costs for environmental compliance required by the state. If it does, it will be through a public rate process.
Unless the State of California repeals or changes the laws surrounding renewable resources, the cost for environmental compliance will continue.
TID had four (4) publicly held meetings, two (2) Industrial only meetings and one (1) Media only meeting to discuss the increase and asked for feedback from customers. The two key points received from customers were; (1) Create a line item on the bill showing the environmental charge & (2) spread the increase over 3 years. The environmental charge/rate increase was published in billing inserts, on the TID website and published in the local media several times.
Should you desire additional information regarding the Environmental Charge, or should you have questions regarding your electric service, please call TID Customer Service at 883-8222.