For immediate release: June 27, 2001
Media Contact: Percy Della - (916) 654-4989

Energy Commission Announces Third Auction
To Offer More Incentives for Renewable Power

Sacramento The California Energy Commission has announced a third auction to help spur the development of more "green" energy for California's electricity market. The auction will award financial incentives to California companies that construct and operate renewable power plants.

The Commission has released a Notice of Auction (NOA) offering a total of $40 million for potential participants. Further auction information is available from the Commission's Web Site at:

www.energy.ca.gov/contracts/2001-06-18_NOA.PDF

Eligible "green" technologies include biomass, digester gas, geothermal, landfill gas, photovoltaics, small hydroelectric (30 megawatts or less), solar thermal electric, and wind.

"We're excited about this opportunity to help more new renewable generators come on-line to meet California's energy needs," said Commissioner Michal (spelled correctly) Moore, chair of the Energy Commission's Electricity and Natural Gas Committee. “We look forward to this auction being as successful as our last two auctions for new renewable resources have been."

Like the first two auctions held in June 1998 and November 2000, the third auction will be conducted by the Commission's Renewable Energy Program. The previous auctions resulted in awards of more than $200 million to new renewable energy projects with a combined electricity generating capacity of 1,000 megawatts.

Of the 72 successful projects that bid in the first two auctions, 30 with a combined capacity of more than 180 megawatts have been completed and are delivering electricity to the grid.

In the first two auctions, the deadline for projects to be built and to generate electricity was December 31, 2001. Projects do not receive any money until they are actually built and are generating electricity. Successful bidders will receive incentive payments of up to 1.5 cents for every kilowatt-hour of renewable electricity they generate, and incentives are paid for the first five years of project operation.

In past auctions, bidders submitted the cents per kilowatt-hour incentive they wished to receive, along with an estimate of their first five years of generation. To qualify for funding, projects had to be located in California and produce renewable electricity for sale, not just for on-site use, and meet the other eligibility criteria contained in the NOA. Bids were accepted from the lowest incentive to the highest, until the available funds were exhausted.

There was a wide variety of renewable technologies represented in the first and second auctions, including biomass, digester gas, geothermal, small hydroelectric (30 megawatts or less), landfill gas, and wind. Incentive bids ranged from 0.26 cents per kilowatt-hour to 1.49 cents per kilowatt-hour.

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