Guest: Energy Independence Act costing less than naysayers warned
The act that required electric utilities to invest in new renewable-energy resources is costing customers less than what the naysayers warned, writes guest columnist David Danner.
Special to The Times
IN recent weeks, critics have taken renewed aim at a voter-approved state law requiring electric utilities to invest in new renewable-energy resources. The Energy Independence Act, they say, has significantly increased costs to consumers and has hurt the state’s economy.
But as the chairman of the state commission responsible for ensuring that privately owned utilities comply with the act, I would like to share a different perspective.
Earlier this month, the Washington Utilities and Transportation Commission issued a set of orders certifying that the state’s privately owned electric utilities will acquire enough new renewable energy — wind, solar, biomass and added hydropower — to provide at least 3 percent of their customers’ needs in 2013, as the law requires.
In 2012, Avista, PacifiCorp and Puget Sound Energy, which combined serve about half the state’s residents, generated or acquired 2.35 million megawatt hours of new clean electricity, enough to power more than 183,000 homes for a year.
That’s impressive. But what really caught our attention was the low cost to customers for all this clean energy.
When Washington voters approved the Energy Independence Act in 2006, opponents argued that it would increase energy costs by $185 million to $370 million per year. At a recent legislative hearing, one group testified that the act is costing the average homeowner $50 a year.
However, the companies’ recent filings to the commission tell a different story. They show that complying with the act only cost their customers an additional $35 million in 2012 — an increase to the average household bill of 1.2 percent, or a little over $1 a month.
Even if we assume another $35 million in costs to account for the half of Washington residents served by publicly owned utilities such as Seattle City Light or public utility districts, the Energy Independence Act’s costs are still less than half of the lowest estimates put forward by the act’s opponents.
And for that cost, the private utilities are actually generating 9 percent of their collective electricity from new renewable resources. They are well on their way to the 2020 target of 15 percent, and have identified plans for reaching it at minimal additional cost.
What are customers getting in return? The Portland-based Renewable Northwest Project has calculated that renewable energy developers have invested more than $8 billion in Washington state, creating some 3,800 jobs.
The benefits are especially significant in rural areas: Klickitat County has collected more than $34 million in additional tax revenues from wind energy development; Columbia County has collected almost $15 million; the new Palouse Wind project will bring about $700,000 a year into Whitman County. That is money that local governments are using for schools, public safety and infrastructure.
Lease payments to farmers and other land owners bring about $8 million a year to rural communities.
What about indirect benefits? Due in large part to the Energy Independence Act and other regional policies, Washington is attracting investment in wind, solar, and energy-storage research and manufacturing, which will bring hundreds more jobs and millions more dollars into our economy.
And then there are the substantial environmental benefits, like a cooler planet and improved public health. Wherever renewables replace fossil-fuel power, they reduce carbon emissions, which increase global temperatures, cause ocean acidification and intensify droughts. In Washington state, this has implications for forest health, oyster and shellfish habitat, and salmon and hydropower, among other things.
Renewable energy also eliminates emissions of other harmful pollutants, such as sulfur oxides, nitrogen oxides, soot and mercury, which contribute to asthma, high blood pressure, heart attacks and other health problems.
Policy makers called on to revisit the act should be aware that what the voters approved in 2006 provides real benefits to the people of Washington. For customers of investor-owned utilities, the cost — about 1 percent of their monthly bill — is a reasonable investment.
David Danner is chairman of the Washington Utilities and Transportation Commission.