VII. The Need for Regional Reporting and Tracking

Staff suggests that a comprehensive generation information system could be developed for some or all of the WECC region, as will be covered by the Western Climate Initiative. A regional system would require that all (or most) states and provinces require the plants located in their areas to participate in the tracking system.

The Joint Staff report describes that a growing number of states either allow or require retail providers to designate the generation that serves their native load. Washington and Oregon have a tracking system in place, and several states are adding renewable portfolio standards, which mandate that renewable energy meet a designated portion of native load. The Joint Staff report recognizes that resources used to serve native load in another state should not be counted as sold to California retail providers. Staff proposes a pilot project with Oregon and Washington to help identify resources claimed by sellers to avoid double counting.

Adoption of GHG regulations in additional Western states would increase the importance of a regional reporting and tracking system. One particularly important development is the Governors' Memorandum of Understanding (MOU) to establish a regional GHG program for the Western states that are signatories. To date, the Western Climate Initiative MOU has been signed by the governors of six Western states (California, Washington, Oregon, Arizona, New Mexico, and Utah) and the premiers of British Columbia and Manitoba. Several federal climate change bills also have been proposed in Congress.

Many of the commenting parties urge the Commissions to move forward rapidly with the development of a regional reporting and tracking system. Some parties suggest that California take leadership, either working through the Western Governors Association or starting with the states that signed the MOU. The parties assert that a regional reporting and tracking system is the only way to produce a completely accurate "source-to-sink" accounting of GHG emissions attributed to electricity that serves California's retail load.

A few parties recommend that the Commissions not develop an interim reporting and tracking system, but instead wait until a regional tracking system is implemented. Other parties accept that an interim reporting system is needed in California, but want a regional solution to be in place prior to 2012, the first year that AB 32 GHG emission reduction requirements will be in force. Several parties suggest that concerns about contract shuffling and leakage can only be addressed by having a regional reporting and tracking system.

We support the call for a regional reporting and tracking system made by several parties in this proceeding. A regional solution to reporting and tracking would greatly increase the accuracy of GHG reporting in California. We direct our Staff to support the California Environmental Protection Agency and ARB to lead a regional development effort through the Western Climate Initiative.

While we support parties' recommendation that a regional solution be in place before January 1, 2012, AB 32 requires that ARB adopt reporting and verification regulations on or before January 1, 2008, and our recommendations support that statutory mandate. The reporting protocol we recommend would aid ARB and the reporting entities during the interim period until a regional reporting and tracking system can be developed and implemented. We recommend that ARB continue to refine our recommendations. Our recommended reporting protocol could be utilized for determining compliance, if a regional solution is not in place by January 1, 2012.