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Home » When renewable trumps sensible

When renewable trumps sensible

March 24, 2011
Editor's Notebook

The push to derive more of our energy needs from renewable resources is laudable and something we all want to see. A big unanswered question, especially in this new-reality economy, is how much of a premium we're all willing to pay for it. Perhaps also, how much common sense will be sacrificed along the way.

I was rolling these questions around in my mind over the last week as Inland Power & Light Co., the Spokane-based electric cooperative, was working on the final details of an agreement to spend $1 million over the next four years—and perhaps far more in later years—for something it says it doesn't need.

Through the pact, which it expects to complete in the next few weeks with an unnamed West Side utility, Inland Power will acquire renewable-energy credits—CEO Kris Mikkelsen refers to it more plainly as "a piece of paper"—enabling the co-op to comply with I-937.

That's the initiative Washington voters passed five years ago that requires larger utilities in the state to obtain at least 15 percent of their power from certain renewable resources, such as wind, solar, and biomass, by 2020. The affected utilities must reach intermediate thresholds of 3 percent next year and 9 percent in 2016.

One of the initiative's more controversial aspects was that it didn't allow utilities to include current hydroelectric generation as a renewable source, since its focus was on new generation. Thus, in the case of Inland Power, which gets its electricity from the Bonneville Power Administration, the fact that the co-op provides its customers an energy mix that's 83 percent renewable and 95 percent carbon-free, counts for naught.

Adding to the co-op's dilemma, Mikkelsen says, is that, "Out to 2016, we have no need for new power, so we will simply be buying renewable-energy credits (from utilities that have them to sell) to comply with the state law." When the state's renewable-energy threshold triples in 2016, she says, "We'll have to buy three times as many 'pieces of paper.'"

To be sure, all larger utilities in the state face the same renewable mandates and similar tough, and likely expensive, challenges meeting them in the years to come. Inland Power claims, though, that it's the only power provider in the state ensnarled by conflicting legal definitions over what constitutes a large utility.

Under the Revised Code of Washington, which is a compilation of all permanent laws now in force in the state, small utilities are those that have 25,000 or fewer electric meters or seven or fewer customers per mile of distribution line, the co-op says.

Inland Power ranks as a large utility under the first criteria, with about 38,450 electric meters, but it says it averages only about five customers per mile of distribution line across the 13 Inland Northwest counties it serves, placing it well within the small-utility category under the latter standard. By comparison, it says, the Washington state average for all investor-owned utilities and public power systems is 41 customers per mile of line.

The problem for Inland Power is that renewable-energy law limits its small-utility definition to just the 25,000-or-fewer-meters standard, ignoring the customers-per-mile-of-line gauge, Mikkelsen says. Under that standard, the law pertains to about 17 of the state's more than 60 public and private electric-energy providers.

Inland Power sought unsuccessfully in the current state legislative session to get that definition revised to conform to the RCW language, which would have exempted it from the renewable-energy law, and Mikkelsen says there seemed to be little political mood for softening the law in any respect.

It will be interesting to see, as renewable-energy costs creep more broadly into customers' utility bills, whether that resolve holds firm.

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