Many business owners will be opposing Gov. Martin O’Malley’s offshore wind energy bill Tuesday during a Senate Finance Committee hearing.
The bill, designed to promote clean energy, would cost residential users about $2 each month per household, but it would increase nonresidential users’ rates by 2.5 percent.
“The utility bill is my single biggest bill after payroll,” said Walt Clocker, owner of Angel’s Food Market in Pasadena.
He estimates the 2.5 percent increase for electricity – needed to run freezers, coolers, lights and appliances – would cost him an additional $4,000 a year. Those costs are likely to be passed on to customers.
“The (utility) rates generally are going to go up, and then you put this (increase) on top of that,” he said. “That’s one more nail in the coffin for small business.”
O’Malley has made promoting wind power one of his priorities for this year’s General Assembly session, citing the need for energy diversity and job creation. His legislation would require utility companies to buy a certain percent of their electricity from offshore wind farms.
A similar bill failed last year after lawmakers became concerned that forcing utility companies to buy wind power would drive up customers’ bills.
Jen Brock-Cancellieri, deputy director of the Maryland League of Conservation Voters, said recent polling showed that 64 percent of Marylanders are willing to pay slightly more for groceries or other merchandise.
“We’ve spent since end of lastsession talking to thousands of voters across the state, and they think wind works for Maryland,” she said.
Raquel Guillory, a spokeswoman for governor, said no one will see higher bills until the wind turbines are up and turning – in 2017 at the earliest.
“Right now, businesses are subject to the volatility of the energy market. They are gong to pay more, but this provides them a stable source of power that isn’t going to be going up,” she said.
Lesa Hoover, vice president of the Apartment and Office Building Association, or AOBA, of Metropolitan Washington, said businesses will have no choice but pass on the cost to tenants.
While flipping through a list of her organization’s members, Hoover discussed what that price would be.
A 235,000-square-foot office building in Montgomery County pays $54,500 per month for electricity now, not counting utility taxes and surcharges. Its average bill would go up about $1,362 per month.
Another AOBA member, a single-meter high-rise apartment building in Prince George’s County, would pay $476 more per month, Hoover said.
“There’s a lot more to this offshore wind bill than just ‘Wouldn’t you be willing to pay $2 more for a cleaner environment,’ ” she said. “That’s all the public has thought about.”
Lobbyist Bruce Bereano, who represents Safeway Inc., said the bill would hit his client hard.
Groceries “are a small-profit-margin business,” Bereano said. “If a grocer can make a penny on the dollar as profit, that’s damn good. Any bump in the costs really affects them and their customers.”
The 700-member Maryland chapter of the National Association of Industrial and Office Properties opposes the bill, according to the group’s vice president, Tom Ballentine.
Ballentine said his members own some buildings that are modern and efficient, and some that were built in the 1960s. Ballentine’s clients provide space for everything from one-man garages to huge research and development firms and government offices.
“Some of the companies will certainly see a six-digit figure rise in their annual rates,” he said.
“These numbers are coming at a time when our members are struggling.”
Not all businesses oppose the wind power legislation. Ross Tyler of the Business Coalition for Maryland Offshore Wind said the potential for new jobs in construction, manufacturing and support is a key benefit.
“By building offshore wind farms, there are multiple types of jobs to be done. All the way down to the lubricants and the brake pads and the transmission cables,” he said. “There is a solid base of workers that are required.”
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