Op-ed by Rep. Terry Nealey: Alternative pathways to energy law needed for cleaner, affordable electricity

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 Alternative pathways to energy law needed for cleaner, affordable electricity
By Rep. Terry Nealey

When sponsors drafted Initiative 937, the “Energy Independence Act,” they said in the state Voters' Pamphlet the measure would “give us cheaper, renewable alternatives like wind and solar,” “reduce our dependence on fossil fuels” such as coal, and “save us money.”  Statewide voters were sold on those promises and gave the measure 52 percent approval in November 2006.

Rep. Terry Nealey on House floorBesides identifying energy conservation targets, the law requires electric utilities with 25,000 or more customers to get at least 3 percent of their power between Jan. 1, 2012 and Dec. 31, 2015 from renewable resources, such as wind farms, solar panels, and geothermal plants. By Jan. 1, 2016, that target increases to 9 percent, and then stays at 15 percent after Jan. 1, 2020. Utilities may also purchase “renewable energy credits” in lieu of meeting these targets.

Eight years into this law, I'm concerned promises of cheaper electricity for Washington's ratepayers and less reliance on coal and fossil fuels are proving false.

Nearly 74 percent of Washington's clean, renewable energy comes from hydropower. Yet, I-937 excluded hydro as a qualifying source. As a result, utilities that rely on hydro have been forced to either build their own qualifying renewable energy sources, or purchase out of state, even the utilities don't need the power.

That has proven to be very expensive, especially for smaller utilities that don't generate their own power, such as Mason County PUD 3, which is spending an additional $2 million to purchase qualifying renewable electricity. Grays Harbor PUD is paying an additional $8 million. If the mandates stay on track, it is estimated energy rates will be forced upward by 13 percent in 2020, costing the average Washington family an additional $170 per year.

Even with renewables in their portfolios, many utilities are still buying electricity generated from coal and other fossil fuels, because it is cheap. So I-937 has also failed to reduce use of fossil fuels. If these utilities get caught up in Gov. Inslee's carbon tax proposal, imagine how electric rates would soar if they had to pay for carbon use!

That's why several lawmakers, including myself, are seeking alternative pathways that would achieve the intentions of I-937 for clean energy and low power rates, and provide flexibility within the mandates. Several bills were proposed:

  • House Bill 1352, a measure I prime-sponsored, would allow efficiency improvements on the hydropower dams owned by BPA to qualify as clean, renewable energy sources. BPA is spending millions to upgrade its infrastructure, so I feel ratepayers should receive the benefits through keeping rates low. This bill would encourage greater efficiencies.
  • Senate Bill 5735 would allow carbon reduction investments to qualify as an eligible renewable resource. These investments would include anything that reduces, prevents or removes carbon gases. It would also consider utilities to be in compliance with renewable energy targets if they invest at least 1 percent of annual retail revenue into carbon reduction.
  • House Bill 2020 would consider utilities to be in compliance with renewable energy targets if they reduce use of electricity generated by greenhouse gas emitting sources by 2 percent annually.

Unfortunately, powerful environmental lobbyists are working hard to kill these and other bills that could provide options and flexibility under I-937 – and threatening campaigns against any lawmaker who would change it.

I don't work for them. I work for you. And I am committed to changes that would ensure affordable, low-cost, reliable and clean electricity for our local consumers.

Five years ago, I wrote: “We must resist costly, ineffective 'feel-good' schemes and mandates that risk saddling consumers with unintended consequences.” I-937 is a prime example. We need reforms now that fulfill the promise made in 2006 to Washington voters when they sought to have a “cleaner, more affordable energy future.”

Editor's note:  Rep. Terry Nealey, R-Dayton, serves the 16th Legislative District and is a member of the House Technology and Economic Development Committee.

State Representative Terry Nealey, 16th Legislative District
RepresentativeTerryNealey.com
404 John L. O'Brien Building | P.O. Box 40600 | Olympia, WA 98504-0600
terry.nealey@leg.wa.gov
360-786-7828 | Toll-free: (800) 562-6000