In a state where environmental issues often find ample support, an initiative to compel utilities to use cleaner energy should be the least controversial of the three measures on the statewide ballot in November.
But after months of little to no debate over the measure – which would require the state’s large utilities to increase renewable energy sources to 15 percent of their supply by 2020 – opponents have started speaking out, arguing that Initiative 937 would raise customers’ rates.
“It’s a feel-good initiative,” said Chris McCabe, spokesman for the Association of Washington Business, which is opposed to the measure. “Everyone wants a cleaner environment. It’s easy for people to buy into that. It’s one of those things where the devil is in the details.”
After years of failing in the Legislature, supporters of the proposal decided to take the issue to voters.
“This initiative is an opportunity for us to take control of our own energy future,” said Chris McCollough, spokesman for the pro-937 campaign. “As our state grows, we have a choice: We can burn more polluting fossil fuels like coal or we can choose cheaper, cleaner energy from new renewable sources and conservation.”
Supporters of I-937 have already raised more than $1.2 million, including large donations from groups like the Sierra Club and Houston-based Horizon Wind Energy, and said they plan an aggressive TV advertising campaign leading up to the Nov. 7 election. Opponents have raised only about $320,000, with the biggest donations from Weyerhaeuser Corp. and Avista Corp.
Under the initiative, utilities with more than 25,000 customers would have to meet 15 percent of their annual load with resources such as wind power, solar energy or sewage gas.
Opponents say the measure is unnecessary, pointing to the fact that dams produce as much as three-quarters of the region’s relatively cheap and clean electricity.
Unlike a similar law in California, the initiative would not automatically count hydropower as renewable energy. Efficiency upgrades to existing hydropower plants will qualify.
Avista Corp., which has 338,000 electric customers in Washington and Idaho and 297,000 natural gas customers in Washington, said it is already pursuing more renewables, but argues it should get credit for the fact that more than half its power comes from hydroelectric dams.
“We believe that is renewable,” Avista spokesman Hugh Imhof said.
Avista had initially been neutral on I-937, but last month called on voters to reject it, arguing that placing mandates on companies would only increase costs for customers.
“Anytime you force everyone in the marketplace to purchase a particular commodity it creates an artificial market,” Imhof said. “It’s simple economics.”
Imhof said that the cost increases won’t affect the companies.
“It’ll go right to our customers,” he said. “We’re already raising the rates enough. We don’t want to raise them anymore.”
A recent report by the state Office of Financial Management said there are too many variables to be able to determine what will happen to rates if the measure is enacted.
And supporters note that under the initiative, if there is more than a 4 percent increase in rates in any one year, then the utilities will be held to a lesser standard.
If the initiative is approved by voters, Washington will join 20 other states, and the District of Columbia, that have a so-called renewable portfolio standard or goal; Maine has the highest, at 30 percent. In 2004, Colorado was the first state to pass a ballot measure in requiring an increase in renewable energy.
Xcel, which has 1.3 million customers in Colorado, opposed that measure, arguing that the initiative could dramatically increase costs.
But in its compliance plan filed with the Colorado State Utilities Commission at the end of August, the company said that it is well on track to meet its requirements by the 2015 deadline, and a spokeswoman said they will fulfill the wind standard alone by the end of 2007.
Xcel customers saved an estimated $14 million in costs over two years ending 2005, but Xcel spokeswoman Ethnie Groves said that it’s hard to predict future savings due to the volatile nature of the fossil fuel market.
“I will say however that we’re really pleased with the addition of wind to our generation mix,” she said. “When the wind blows during our peak demand periods, it helps our entire system.”
Under current Washington law, utilities are already required to offer customers the option of investing in renewable energy, by paying extra on their monthly bill.
The other major utility companies that would be affected by the initiative have maintained their neutral stand, including Puget Sound Energy.
“While we support the objectives of the initiative’s sponsors, we just don’t believe that the ballot box is the proper venue for dictating policies on an issue as complicated, as complex, and as uncertain as the development of new power resources by utilities,” said Roger Thompson, the utility’s spokesman.
Last year, Puget Sound Energy began operating a $200 million wind farm in southeastern Washington and has said it expects to have a second wind farm operating in Kittitas County by the end of the year.
Thompson said the utility was looking to add even more renewable resources and would likely be at 6 percent renewable by the end of this year. The company has more than 1 million electric customers, primarily in the Puget Sound region.
Imhof said that the unpredictability of the market means that companies – and ultimately customers – will suffer if wind doesn’t turn out to be a dream resource .
“The cost of wind has doubled in the past two years. What’s that going to mean in 10 years? Is it still a viable resource to add to our portfolio?” he asked.
A report by the business-backed Washington Research Council said that initiative could drive up electricity costs from $185 million to $370 million and could cost the state thousands of jobs.
But McCollough disputed that report, and said that the conservation efforts alone will save money. He acknowledged that the there’s been an increase in the price of wind, “but there’s been a bump in the price of everything.”
“They can talk about hydro all they want, but the fact is there’s no major hydro project coming online anytime in the future,” McCollough said. “The reality is we can choose coal or we can choose renewables.”
On the Net:
Yes on I-937: http://www.energysecuritynow.org
No on I-937: http://www.noon1937.com
Association of Washington Business: http://www.awb.org/
Northwest Power and Conservation Council: http://www.nwcouncil.org/
Washington Research Council: http://www.researchcouncil.org/
By Rachel La Corte / Associated Press
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