Customers can buy credits to support efforts in other areas
Entergy New Orleans is moving forward with a program that would allow residents to purchase credits for power produced from sources such as wind, solar and biofuels.
The company sees the effort as a way to bolster its green credentials while allowing ecology-minded ratepayers who can afford to do so the chance to contribute to a burgeoning renewable energy industry.
Critics contend the voluntary program is little more than a token measure that does little locally to reduce carbon emissions or fossil fuel use and won’t ensure residents are actually getting any of their power from renewable sources.
“If you decide to sign up for it, what we would do is buy a credit from a company that creates power from a renewable source,” ENO spokesman Morgan Stewart said. He estimates the utility could begin selling the credits as early as October, following a period of public comment and final signoff by advisors to the New Orleans City Council.
“That does a couple things. No. 1, it helps the people who are generating renewable power find a market for their product,” Stewart said. “And No. 2, it helps this area benefit from and assist in the creation of renewable power sources.”
The utility plans to sell credits to residential customers in blocks of 500 kilowatt hours and commercial ratepayers credits in 1,000 kilowatt hour blocks, with unlimited blocks available. The expected cost to subscribing residential customers would be between $7.50 and $10 per block. Commercial users would pay between $15 and $20 per block.
While utility customers in other parts of the country can buy power generated from renewable sources, ENO’s plan would not mean a shift from its reliance on fossil fuels nor would it mean power purchased through this credit system was generated or used locally.
Still, Stewart said the program makes the most sense for New Orleans, where he said powering homes and businesses on renewable energy simply isn’t feasible because of a lack of local production and people with the means to pay for it.
Stewart said ENO ratepayers pay slightly more than 11 cents per kilowatt-hour for electricity. Renewable energy might cost customers anywhere from 1 cent to 10 cents per kilowatt-hour more than conventionally generated power, he said.
“We’re not trying to go for that program,” Stewart said. “A more affluent economy might not feel the pinch as much of a higher cost, whereas we do.”
John Atkeison, director of climate and clean energy programs for the New Orleans-based Alliance for Affordable Energy, said ENO’s reasoning is outmoded and its renewable energy credits program is virtually useless.
“The program calls for selling people renewable energy credits, not renewable energy,” Atkeison said. “There is a fellow in the office who said it’s kind of like paying Whole Foods prices for someone somewhere else to eat organic.
“It’s our suspicion that Entergy is proposing this simply as a way to head off something more serious. We need more green power. We need it desperately and Entergy is standing in the way.”
State laws drive renewable energy programs in other parts of the country, requiring utilities to derive a certain percentage of their power from renewable sources by a certain deadline. Such standards are currently in place in 24 states and Washington, D.C., according to the U.S. Energy Department.
ENO says enacting such a law in Louisiana is the wrong idea, one that amounts to forcing renewable power on all customers, some of whom lack the means to pay the higher costs associated with it.
“It breaks down to whether people should be allowed to buy Winn-Dixie brand milk if they want or organic milk if they want,” Stewart said. “We think it should be a voluntary program.”
To date, the state’s Public Service Commission has agreed, arguing that renewable energy standards would unduly increase utility rates.
But without renewable energy laws, green energy proponents argue utilities have little incentive to adjust their fuel choices while prospective producers are unlikely to set up shop without a guaranteed market for their power.
That was the case for two Lafayette-area businessmen who proposed developing an offshore wind farm off the coast of Louisiana. Offshore Louisiana boasts “the gold mine of wind in the country,” said Harold Schoeffler, co-founder of New Iberia-based Wind Energy Systems Technology. Even so, the company has moved its project to Texas.
“In Texas, we can sell the power,” Schoeffler said. “We can’t in Louisiana.”
by Emilie Bahr
16 June 2008
|Wind Watch relies entirely
on User Funding