Fliers from a Washington, D.C., based energy company started appearing in Bozeman mailboxes late last year, urging people to switch to “100% Clean Wind Energy,” a claim many have been dubious of.
Kyla Maki, the clean energy program director for the Montana Environmental Information Center, has been getting a lot of questions about whether a home’s power source changes if they sign up with this company.
“It doesn’t change,” Maki said. “You’re not actually switching.”
The company behind the ads, Arcadia Power, isn’t your power provider. It can’t ensure your home or business uses only renewable energy – the best way to do that is install your own power source. Otherwise, the power still comes from NorthWestern Energy’s electrical soup of coal, natural gas, wind and water.
Instead, customers who sign up send their energy bills to Arcadia and pay a small premium – about 1.5 cents per kilowatt hour of energy used. Arcadia then pays NorthWestern its share of the bill and uses the premium to invest in wind projects around the nation – none in Montana – with each investment theoretically offsetting carbon emissions used to provide that customer with power.
Arcadia co-founder Ryan Nesbitt said the company is simply a middleman helping consumers tap a market large companies have already taken advantage of to choose to pay for clean power, even if the consumer’s actual power supply is dirty.
“This is the market that exists,” Nesbitt said. “A lot of people aren’t familiar with it, which is unfortunate.”
The market that Nesbitt is talking about revolves around renewable energy certificates, or RECs. RECs attach monetary value to the environmental benefits of renewable power. One of the benefits clean energy advocates see is offsetting carbon emissions from coal-fired power plants, which contribute to climate change.
Every megawatt-hour of power generated by a renewable project produces one REC. Buying those can help ease the financial burden of developing renewable energy, thus making it easier for the presence of renewables to increase its role in energy production.
But buying a REC won’t directly change how much of Montana’s energy is generated from coal. Electricity on the grid mixes together and is distributed without discrimination by source. Electrons from wind, hydropower, solar and coal all meet, and some combination keeps the lights on in Montana homes whether someone buys an REC or not.
With that as a backdrop, NorthWestern Energy spokesman Butch Larcombe said people who have signed up with Arcadia “may not be accomplishing as much as they think.”
Still, clean energy advocates consider Arcadia’s model a good way to support the industry.
“This is one of the only ways to support renewable energy development beyond what your utility is already doing without installing a system at your house,” said Jeff Fox, the Montana policy manager for Renewable Northwest.
Maki said customers who sign up for programs like this also send a message to utility companies.
“It does help send a signal to the utility companies that their customers are interested in renewable energy,” she said.
Larcombe, the NorthWestern Energy spokesman, thinks the company has already gotten that signal.
“We’re delivering a pretty green portfolio,” he said, “and it’s only going to get greener as time goes on.”
NorthWestern’s power is now mostly renewable, Larcombe said, with about 56 percent of its power coming from renewables. He thinks that percentage will only grow larger in the coming years.
NorthWestern does offer a similar program, called E+ Green, that works in very much the same way. The utility has offered that option since 2003 and is required to do so by Montana law. At the last official count, 259 customers were signed up, though that number has been as high as 350.
The main difference is that a consumer’s energy bills wouldn’t be going through a separate middle man.
“In our eyes, it doesn’t make sense to go green with someone else,” Larcombe said.
The utility hasn’t been as aggressive at marketing the program as Arcadia has, though.
Larcombe said about 90 of the utility’s customers are having their bills sent to Arcadia, and that the signups appear to have started in February 2015. One of those customers is Bridger Brewing, whose logo is emblazoned on the fliers that have found their way into the Bozeman area.
“Renewable energy is just something that a lot of us here …. a lot of people around Bridger Brewing find important,” said David Breck, one of the brewery’s owners.
Breck added that Bridger had looked into getting solar, but found that it was too expensive. The Arcadia route looked to be an affordable way to support renewables.
“We spend a little bit more on power,” Breck said. “But we think it’s worth it.”
Breck said the real benefit comes in renewable energy being produced, no matter where it is. He also said he hadn’t known about NorthWestern’s version of the program before, but would have considered it.
Larcombe said NorthWestern’s marketing of its version of the program has been intermittent and low key. He also said that E+ Green customers aren’t getting energy that regular customers aren’t.
“We don’t see a need to ask people to pay extra to get the same outcome,” Larcombe said.
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