The California Energy Commission has the statutory responsibility for licensing thermal power plants 50 megawatts and larger and the plants related facilities such as transmission lines, fuel supply lines, water pipelines, etc. The Energy Commission's 12-month, one-stop permitting process is a certified regulatory program under the California Environmental Quality Act (CEQA) and includes many opportunities for public participation. The Energy Commission's license/certification subsumes all requirements of state, local, or regional agencies otherwise required before a new plant is constructed. More...

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Energy Commission Power Plant Licensing

The California Energy Commission has the statutory responsibility for licensing thermal power plants 50 megawatts and larger and the plants related facilities such as transmission lines, fuel supply lines, water pipelines, etc. The Energy Commission's 12-month, one-stop permitting process is a certified regulatory program under the California Environmental Quality Act (CEQA) and includes many opportunities for public participation. The Energy Commission's license/certification subsumes all requirements of state, local, or regional agencies otherwise required before a new plant is constructed. The Energy Commission coordinates its review of the facility with the federal agencies that will be issuing permits to ensure that the Energy Commission certification incorporates conditions of certification that would be required by various federal agencies.

From 1978 to 1998 before California's electricity generation industry was restructured, the Energy Commission analyzed and approved 47 projects totaling 5,589 megawatts (MW). More recently, in the early 1990s the Energy Commission certified 14 power plants. Of the 14 plants, 10 were approved and eight were constructed totaling 995 MW. No power plant applications were filed with the Energy Commission between August 1994 and May 1997 because there was so much uncertainty during the pending restructuring of the electricity industry.

Electricity deregulation began on March 31, 1998. From 1998 through January 2004, 44 electric generation projects, totaling 18,399 MW, have been reviewed and licensed by the Energy Commission. Twenty-four of these licensed facilities have been built and are on-line producing 8,311 MW. Workload has been at historic levels these past several years with the peak number of applications for new projects twice that of the peak in the 1980s. Over the past several years, the Commission tracked upwards of 150 potential projects 50 MW and larger; however, most of these projects were not filed with the Energy Commission because of unfavorable market conditions.

The following table shows that the Commission has processed more proposed projects in the past six years (58 projects) as were reviewed over the previous 20 years (47 projects). One can also see that, on average, the size of the more recent projects are about three times larger than the projects prior to restructuring.

Project Summary - Post-Restructuring
(PDF file, 2 pages

Also note that as of 2004, a total of more than 1,200 megawatts of power
were approved and permitted at the local level by cities, counties, etc.

During the energy crisis (2000-2002), the Energy Commission utilized several processes and timelines. On the Emergency Orders of the Governor, a 21-day review was implemented for peaker projects (projects that would normally operate less than 2,500 hours per year). Additionally, 4-month and 6-month processes were authorized by the legislature on a short-term basis. The legislation establishing these licensing processes contained sunset clauses and the processes have expired.

The two processes that are currently available are the 12-month review (Application for Certification - AFC) and the Small Power Plant Exemption (SPPE). The SPPE is available for projects between 50 MW and 100 MW, provided the proposed project does not create an unmitigated significant impact on environmental resources. The Energy Commission completes an Initial Study (mitigated negative declaration) and, if approved by the Commission, the project developer would be responsible for securing local, state, and federal permits to construct and operate the facility. The Energy Commission strives to complete the SPPE review in 135 days.

The fees for filing an AFC are $100,000 plus $250 per MW payable at the time of filing. There is also an annual compliance fee of $15,000 for all projects granted a license. Projects that would use a renewable resource as its primary fuel source are exempt from the filing and compliance fees. The fee for filing a SPPE equals the actual cost of the Energy Commission's review. We request a deposit of $200,000 at the time of the filing. The account will be settled after the final decision is made by the Energy Commission based on the actual costs either by billing the project developer for the costs that exceed the deposit or providing a refund if the costs are less than the deposit. There is no annual compliance fee for a SPPE because the Energy Commission is not licensing the project but only completing the appropriate environmental documentation.

The Energy Commission's licensing process is recognized as an effective method for the timely permitting of major energy facilities in California. In a February 2002 study by the Hewlett Foundation, Susan Tierney of Lexecon, the principal author of the report states, "California's traditional plant siting laws strike a balance between public involvement and timely project review that is predictable, transparent and effective."

The report concludes, "The traditional 12-month siting process of the CEC (California Energy Commission) is in design and practice an effective mechanism for the timely siting of major energy facilities in the State of California. The standard CEC siting process not only is relatively fair and efficient, but is also very effective at encouraging and responding to meaningful public input, and contains a comprehensive review of potential environmental impacts."

For more information about the Commission's Energy Facility Licensing process, please contact the Commission's Energy Facilities Siting Division at the address or phone number below. The Commission's Energy Facility Siting and Environmental Committee has policy oversight responsibility for the Commission's power plant siting program. The policy committee members are: Presiding Member - Commissioner John L. Geesman, Associate Member - Commissioner James D. Boyd.