As discussed in an article by McClatchy Tribune, a lot of utilities in California are feeling “under pressure to meet state renewable energy mandates”, and are therefore prepared to pay higher prices for power.

Example is a current case from Southern California Edison is currently “preparing to pay nearly double the price Riverside’s electric utility had been paying for power from a Riverside County landfill.”The county currently derives about 16% of its power from geothermal, wind, solar, biomass and other renewables, set to meet the 20% requirement for electricity from renewable sources by next year. (33% by 2020)

The 10-year contract will – based on the news – go before the county’s Board of Supervisors, under which Edison would pay US$ 100 per MWh (megawatt-hour). This one has to see in relation to a recent deal by Riverside, California, which signed a contract with the Northwestern Band of the Shoshone Nation in Utah for geothermal energy at a cost of about US$80 per MWh.

The glitch with the current deal for Edison are the necessary permits for the development, as burning methane, while reducing greenhouse gas and toxic emissions, are still producing somepollution linked to health problems, so the article.

Source: McClatchy Tribune (via tradingmarkets.com)