Some states use laws and rules to slow growth of renewable energy
The 2009 state measure is weaker than many other states’ renewable portfolio standards, in that its broad definition of renewable energy includes coal and natural gas-based fuel sources. Still, Armstead told West Virginia outlet MetroNews that the law “has a devastating impact on our energy sector, [and] our coal jobs in the state,” warning that “it will result in increased utility rates for our citizens.”
If Armstead is successful, West Virginia would be the latest in a growing number of politically conservative states to scale back laws and policies encouraging renewable energy and energy efficiency. Environmental groups are increasingly worried that this retreat could undermine states’ ability to comply with U.S. EPA’s looming Clean Power Plan, which aims to lower the power sector’s greenhouse gas emissions by 30 percent from 2005 levels.
Renewable energy and energy efficiency account for half of the building blocks EPA has suggested to states as ways to achieve their emissions reduction goals. As of now, Renewable Portfolio Standards (RPS) are the highest-profile way states have encouraged renewable growth.
Approximately 30 states have RPS laws in place. And while the percentages and timelines differ, the bulk of states with standards require utilities to purchase somewhere in the range of 15 to 25 percent of their energy from alternative sources within the next decade or so.
State power commissions remove incentives
Ohio’s law sets a 12.5 percent benchmark and a 2026 deadline. It also requires utilities to reduce energy consumption by a significant amount. But in June, Republican Gov. John Kasich signed a law freezing those standards in place for two years.
Republican lawmakers pushed for similar — and oftentimes more aggressive — measures in several other states during the last legislative session, but Ohio was the only state where they succeeded.
However, while the bulk of RPS repeals have stalled in legislatures, recent public service commission votes in two states have environmental groups worried about other ways that renewable and efficiency efforts could be undermined.
In late November, Florida’s Public Service Commission voted to phase out a program offering rebates on solar energy purchases, according to TampaBay.com. The commission also voted to drastically reduce the amount of energy it requires utilities to conserve. And in Wisconsin, the commission voted to increase fixed rates for customers of three different utilities (EnergyWire, Nov. 10).
While those rate increases don’t carry the obvious tie to renewable energy that a frozen RPS or eliminated solar rebates do, Natural Resources Defense Council staff attorney Samantha Williams warned they can do just as much damage to the renewable energy sector.
Increasing the flat fee that consumers pay each month, she said, “reduces the part of your bill you can control … that one ability you have to address your energy use.” If consumers are paying more for energy either way — and the Wisconsin rate hikes ranged from about 40 to about 80 percent — Williams argued that fewer people would be interested in investing in solar energy or taking other steps toward lowering electricity use. This is especially so as higher monthly bills can increase the length of time it takes to make back the money spent on those purchases.
“I’m very concerned that these rate restructuring proposals are going to have some of the worst chilling effects on customers getting more rooftop solar and becoming more efficient [when it comes to energy use]. And those kinds of investments are key,” she said to states reaching their emissions reduction goals.
The Koch brothers fund campaigns
The effort to scale back renewable and efficiency incentives has been led partly by Americans for Prosperity, a conservative group funded primarily by Charles and David Koch. The Koch brothers have become national political figures in recent years, not only because they have spent increasing amounts of money on campaigns, but because Democrats have strategically made the billionaire brothers the face of big-money politics.
AFP did not respond to several requests for comment, but its state-level outlets have been very vocal when it comes to renewable portfolio standards and other alternative energy incentives.
“Green energy mandates replace the free-market with bureaucratic government oversight, driving up costs,” AFP’s Kansas branchwrote earlier this year in a blog post. “There is nothing wrong with investing in newer energy technologies like windmills. … However, when such ‘investment’ is made by government in the form of massive subsidies, it unfairly takes money out of the wallets of private citizens.”
Critics point out that the more of a foothold that renewables like wind and solar claim in the nation’s power structure, the more a refinery-heavy company like Koch Industries would be threatened.
The renewable rollback AFP pushed for in Kansas ultimately came up a few votes short in a high-profile floor vote this year, according to The Kansas City Star. But Republicans picked up several seats in the Kansas Legislature in November, and the bill’s sponsors will likely try again in the upcoming session.
An easier path for Wis., Fla. and Ohio?
A remaining question is whether states like Wisconsin, Florida and Ohio are making it harder for themselves to comply with the Clean Power Plan. Jeff Burks of Energy Strategies LCC said that like a lot of big CPP questions, “it depends.”
Burks has worked on compliance models for several states and said renewables “can be a significant contribution to states’ compliance and utilities’ compliance,” especially if EPA ends up giving states credit for previous efforts, as many states have asked for in their comments on the rule. If not, he said that renewables “become more of a marginal contributor,” but a contributor nevertheless.
According to Burks, states could end up embracing alternative energy growth if it’s their clearest path to meeting their EPA goals, whether or not there are portfolio standards in place.
“The RPS isn’t necessarily going to be a ceiling on the amount of renewables that get developed. To the extent there’s more renewables that are cost-effective and count as compliance, then I suspect … there will be an incentive for utilities to invest in more renewables than a reduced RPS may require,” he said.
Of course, renewable advocates such as the NRDC’s Williams argue those energy sources are a lot more cost-effective when state policies are boosting their development.