I was thrilled to see the CPUC finally issued a draft decision in the Feed-in Tariff proceeding on Tue this week. When confirmed by the Commission, it will initiate a significant new program called Renewable Auction Mechanism (RAM) focused on projects in the 1-20MW size range. We strongly believe RAM will be a effective stimulus for California utilities to procure power from 1-gigawatt's worth of these types of projects.
The RAM's focus on resources in the 1-20MW size is very important. So-called 'wholesale distributed scale' projects are exactly the kind of resources that my company, Recurrent Energy, has been advocating as a developer. Because they're less controversial environmentally and faster to interconnect, distributed projects can be delivered to market in much shorter time frames compared to central scale (100MW+) projects. That's good for utilities, regulators, ratepayers, and the solar industry.
Needless to say we were actively involved in the proceeding and advocated for a number of features included in the decision. In particular, we were very happy to see the Commission reject a European-style FIT with a fixed price for electricity based on system cost. Instead the program features a capacity auction mechanism that ensures utilities and ratepayers will get the best cost for solar power based on the market. We were also very happy to see the program impose strong viability requirements on developers to ensure those who participate have the ability to deliver quality projects.
We're looking forward to getting the program implemented. The RAM will be an important new feature of California's efforts to build on its successes so far like CSI and RPS. From our perspective, it represents a key transition to the next era of California's solar and renewable energy leadership.
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