Members of a special committee tasked with ironing out the details of a controversial renewable energy bill were unable to come to a unanimous decision on recommendations, leaving locals in agriculture with a law they say will unnecessarily raise their energy costs and negatively impact their bottom lines.
Gov. John Hickenlooper signed Senate Bill 252 – which requires rural energy providers to produce 20 percent of their power through renewable sources by 2020 – into law in June while saying the legislation is “imperfect” but it represents the general direction he thinks Colorado should go.
In an executive order, Hickenlooper tasked a 12-person advisory committee – including representatives from environmental groups, agriculture and rural energy cooperatives – with hashing out whether or not the law is feasible and how it should be implemented.
However, when asked this week about potential suggestions they might be giving to lawmakers for the upcoming legislative session, committee members said they met only three times and released final report as far back as September, concluding that the law’s requirements are feasible, but the group made no formal recommendations because members did not come to a consensus.
Marc Arnusch, a Weld County farmer on the committee, said members of the committee had strong and fundamentally opposed perspectives on the law, ultimately preventing a unanimous decision.
“We had a hard time even agreeing on what day to meet, let alone on the workings of the bill,” Arnusch said. “To come to an agreement on tweaks or fixes just wasn’t possible.”
Members of the agricultural community and of rural cooperatives like Tri-State Generation & Transmission Association, which provides electricity to 18 rural cooperatives in Colorado, say Hickenlooper should never have signed the bill.
They argue that the law places an unnecessary and expensive time constraint on rural cooperatives, which will pass along added costs to farmers and ranchers who own them.
“My frustration is that this renewable energy train is leaving the station too quickly, and a lot of us can’t jump on it,” Arnusch said.
First, the committee was tasked with figuring out whether or not complying with the law by 2020 is even possible.
Members agreed that with the use of Renewable Energy Credits, the law’s goals are attainable. The group also decided that the 2 percent cap on rate increases applies annually to each customer.
Arnusch said a 2 percent rate increase may not seem like much to the average energy consumer, but that increase means a lot of money to those in the agricultural industry.
For example, he said one dairyman in Morgan County said he spends on average $20,000 to $30,000 per month to run his operation. Arnusch said on average, he spends about $150 per acre per year just to operate his pumps to irrigate.
“In many cases, that (increase) could be a significant part of our margins moving forward,” Arnusch said.
Arnusch said the impact on farmers’ bottom lines may be great enough to affect how much water they use, as it becomes more expensive to use energy to irrigate.
“In Weld County, it’s as much a water issue as it is an electricity issue,” Arnusch said. “I’m afraid that if this trend continues, you will see crop shifts based on the availability of water and the cost to pump it.”
From the perspective of rural cooperatives, one of the biggest issues with the law is that it doesn’t include large hydroelectric projects.
Dave Lock, senior manager of government relations for Tri-State, said the not-for-profit, wholesale energy producer already gets anywhere from 23 to 24 percent of its energy through renewable resources, but large hydroelectric projects are the biggest part of that.
“If your concern is green house gases and global warming, then you would think you would include hydroelectric as a resource,” Lock said. “If your interest is selling wind turbines, then perhaps you wouldn’t want to include that.”
One challenge for companies that supply energy to rural cooperatives, Lock said, is that all of the added costs have to stay in Colorado, although Tri-State serves co-ops in New Mexico, Nebraska and Wyoming as well.
That means the organization has to come up with varied rates for its customers in this state.
Lock said Tri-State vehemently opposed the bill before it passed but, now that it’s officially law, the organization will meet the requirements.
“We’re going to do everything we can to comply with 252, and we’re in the process of coming up with a game plan to do so,” Lock said. “We decided that we fought the battle, we lost, so we’re now going to do everything we can to comply with 252.”
Pete Maysmith, executive director of Conservation Colorado, a proponent of the renewable energy law, said he understands the concern among those in agriculture and those in the energy industry, but he said this is not the first time voters have chosen to move toward more renewable energy.
“Let’s not forget Coloradans have said, ‘We like renewable energy. We want more of it,’” Maysmith said.
He said just because cost increases are capped at 2 percent, that doesn’t mean rates will go up that much.
Regarding adding hydroelectric projects to the approved list, Maysmith said the main goal of the renewable energy law is furthering the future of renewable energy.
“The point is that large hydro is already out there and happening,” Maysmith said. “The point of a renewable energy standard is to help grow and foster clean sources of energy that will grow and ultimately take up a larger and larger percentage of how we deliver energy.”
While the committee didn’t come up with any official recommendations, it included in its final report a set of proposals that members discussed, among which are extending the 2020 deadline, counting large hydroelectric projects and coming up with a long-term energy plan for the state.
Arnusch said that the committee wasn’t fruitless, as it spawned productive conversations on the future of energy in Colorado.
He said he hopes to see voters encourage their legislators to come up with bills that would alleviate some concerning parts of the law, and he looks forward to more dialogue on how to reasonably balance traditional energy sources with new ones.
“I think there’s been some good conversation behind the scenes between the ag community and the power generators within the state,” he said. “Hopefully, we can find some sort of direction as we move forward and look toward our future.”
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