Senate hearing in Richland to consider energy act
Credit: Annette Cary, Tri-City Herald | September 14, 2013 | www.tri-cityherald.com ~~
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Washington senators want to learn what Tri-City area residents and businesses think about the Energy Independence Act at a rare legislative hearing to be held in Richland on Monday.
The Washington State Energy, Environment and Telecommunications Committee hearing starts at 7 p.m. at the Richland Public Library, 955 Northgate Drive. The public is invited to comment at the hearing.
The Energy Independence Act is based on Initiative 937, which was approved by just under 52 percent of state voters in 2006. In Benton and Franklin counties 66 percent of voters opposed it.
The act requires utilities with at least 25,000 customers to buy at least 3 percent of the power from eligible renewable resources, such as wind and solar, and increase that to 9 percent in 2016 and 15 percent in 2020.
However, most hydropower is excluded from being included in those totals.
Washington has some of the lowest energy costs in the nation, but that could be jeopardized by the act’s requirements that utilities buy more qualified renewables, said Sen. Doug Erickson, R-Ferndale, chairman of the committee, in a statement.
He’s looking for solutions to maintain low energy costs while developing new energy technologies, he said.
Supporters of the initiative say it is working, particularly its less controversial requirements for energy efficiency, and that it has increased investments in new renewable energy sources, such as Eastern Washington wind farms.
But when the Benton and Franklin public utility districts held a joint hearing before the 2012 legislative session, about 60 people attended and no one spoke in favor of the requirements to buy more of the renewables considered eligible by the act.
Franklin PUD could be large enough soon to fall under the act’s requirements, and the Richland city electric service may not be far behind.
Benton PUD had to start meeting the act’s requirements in 2012, when the mandates started, but began making purchases to meet the requirements years earlier.
However, Benton PUD, like most other utilities, has power under contract years into the future. In Benton PUD’s case, it has enough power under contract to meet customers’ needs until 2020. Most of that power is relatively inexpensive hydropower.
But to meet the requirements of the act, Benton PUD will have to buy more power it does not need, or more likely, will use an option for a renewable energy credit, said Karen Miller, Benton PUD spokeswoman. Under the credit program, a utility essentially pays for the power it doesn’t need and then the producer can sell it elsewhere as a nonrenewable.
Benton PUD estimated a year ago that to meet the increased requirement in 2016 it will have to spend $1.5 million to $3 million for credits for renewable energy.
Some utilities have power under contract far into the future because demand for power generally has decreased or been flat as a result of the difficult economy statewide. That was not foreseen seven years ago when Initiative 937 essentially required the purchase of additional power to meet renewable objectives, according to opponents of the act that resulted.
Several attempts have been made to modify the act, most recently with a bill introduced this winter by Sen. Sharon Brown, R-Kennewick. However, it failed to make it to a vote by the full Senate.
It would have allowed utilities to postpone increasing the percentage of eligible renewables purchased until more power was needed to serve customers, preventing the purchase of unneeded power or equivalent credits.
“Our families in the Hispanic community work hard to put food on the table and pay their electrical and other utility bills,” said Martin Valadez, then president of the Tri-Cities Hispanic Chamber of Commerce, at a February legislative hearing on Brown’s proposed modification of the act.
“So why would we want to raise these electrical rates simply to fulfill a mandate that is sending big dollars to developers and taking money away from our families?” he asked. “While we support efforts to increase renewable energy, we do not want this to be done on the backs of hard-working families.”
As Tri-City-based Citizens for Protecting our Washington Energy Rates, or POWER, geared up for the 2013 legislative session, it estimated that future wind power rates were estimated at $75 to $125 per megawatt-hour and solar was projected to be more expensive at $180 to $270.
In contrast, the Bonneville Power Administration rates were at $28 per megawatt-hour, with the majority of its power from hydro generation.
But Gov. Jay Inslee, campaigning in the Tri-Cities shortly before he was elected, said the Energy Independence Act has generated $7 billion in new investments statewide.
In Benton County, $162 million has been invested in wind energy jobs, creating 81 construction jobs and 12 operating jobs, according to the Renewable Northwest Project, a study he cited.
In Columbia County, $514 million has been invested in wind energy, creating 480 construction jobs and 18 operating jobs.
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