Energy choice bill goes to Rules Committee for interim study
February 21, 2014
A bill in the State Legislature that would allow cities and counties to contract for renewable energy on behalf of its residents has been sent back to the House Rules Committee for interim study.
H.B. 110, sponsored by Rep. Kraig Powell (R-Heber City), was heard in the House Political Subdivisions Committee at the Utah State Capitol on Tuesday. Powell had introduced a substitute of the bill that addressed specific details of how customers would be metered for renewable energy usage.
"I have a significant number of constituents who desire to be able to purchase renewable energy," Powell said at the committee hearing. "The language [in the bill] is drafted in a general fashion. A city or county attempting to take advantage of this would have a lot of homework to do first."
Summit County Councilman Roger Armstrong also testified before the committee. He said that community choice aggregation (CCA), the system the bill is partly based on, is already implemented in places like Marin County, Calif., so Utah would not be flying blind.
"If you believe in renewable energy, you pay more for it. If you don’t care, [your charges] stay the same," Armstrong said.
Armstrong noted that Pacific Gas and Electric Company, which operates in Marin County, Calif., has started to offer more renewable energy and that none of the power companies in the area have gone out of business as a result. Under the CCA system, he said a city or county would become a "power authority" that would determine its power needs.
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Rep. Jerry Anderson (R-Price) said H.B. 110 is "a step that helps to put the coal [industry] out of business" and that there is no talk in the bill of lower energy costs.
Rep. Michael Kennedy (R-Alpine) worried about the economies of scale behind the bill.
"When a customer exercises the choice [to buy renewable energy] and pays the incremental amount, the pool of traditional customers shrinks," Kennedy said. "Everybody in the traditional [energy] pool will pay additional costs."
Vicki Bennett, sustainability director for Salt Lake City, said the city’s citizens and businesses are demanding more energy options that prices of renewables are dropping. She said Rocky Mountain Power’s Blue Sky program focuses on renewable energy credits, not programs.
Michele Beck, director of the Utah Office of Consumer Services, expressed concerns about the bill and said it could have a negative impact on utility rates. She said that entities with the CCA system in place have restructured, deregulated markets and that Utah would have "a lot to do."
Ted Rampton of Utah Associated Municipal Power Systems said that the bill is "open access," which presents a huge problem.
"We have grave concerns with open access we fought it 15 years ago," Rampton said. "We have nothing against renewables."
Powell stressed that the bill would cap the amount of renewable energy that could be produced at 300 megawatts. He said the CCA-type system would be just an "experiment" under that cap.
In an interview on Wednesday, Powell said that he expects to take some time during the year to examine the "issues and complexities" that a CCA presents, but that a different model could be implemented, since Utah is a regulated monopoly state for Rocky Mountain Power.
"If we just decided as a policy that the Utah Public Service Commission is going to impose a fee [for renewable energy] and it’s based on blanket usage and we just proximate what it is and impose that, it could be simpler than [Rocky Mountain Power] is making it sound," Powell said.
Responding to Rep. Anderson’s comments that the bill is "anti-coal," he said that H.B. 110 "doesn’t force anyone to do anything" and imposes no restrictions, regulations or quotas on any types of energy. Powell added that pushing the CCA concept is crucial.
"My thinking is, if we continue on the course of asking to have the ability to contract [for renewable energy] with other providers, it will propel Rocky Mountain Power to accelerate their own production as a renewable energy provider," Powell said. "And [the people] will win either way."
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