California utility Pacific Gas and Electric (PG&E) announced today that it plans to enter into a 175 MW purchasing agreement with local geothermal leader Calpine.

The agreement, consolidating six existing agreements totaling 118 MW and adding 57 MW of new geothermal power, allows the utility to assert it will meet its legal obligation of 20 percent of its future energy delivery as renewable by 2010 under California law.

PG&E had a setback last week when Western Geopower, a geothermal plant operator, terminated its contract to sell 25.5 MW of geothermal power to the utility.

The company technically now has enough contracts, but in some cases, such as a recently-announced deal with Finavera Renewables (see PG&E to ride the waves with Finavera), actual power isn't expected to come online until after the 2010 deadline passes.

If a utility falls just short of 20 percent by the end of 2010, it can still comply with the law by exceeding the 20 percent goal in 2011.

Some deals with new suppliers, such as GreenVolts (see GreenVolts lands agreement with PG&E), are scheduled to come online before 2010.

Starting in September 2008, the new Calpine agreement is to deliver renewable energy from The Geysers Geothermal Field, 75 miles north of San Francisco.

Other renewable sources in PG&E’s portfolio include solar, wind, biomass, geothermal, and small hydroelectric.

Since July 2007, PG&E has signed renewable energy contracts totaling 1,024 MW, including today's Calpine agreement.

California’s Renewable Portfolio Standard (RPS) program requires utilities to increase their procurement of eligible renewable generating resources by one percent of load per year to achieve a twenty percent renewables goal by 2010.

The RPS program was passed by the Legislature and is managed by California’s Public Utilities Commission and Energy Commission.