November 25, 2009 in City

Avista pushes climate bill

Business group lobbies for cap-and-trade
By The Spokesman-Review
 

Water spills over Avista’s Cabinet Gorge Dam on the Clark Fork River in northwest Montana.
(Full-size photo)

At a glance

>> Avista Corp. helped found a new lobbying group that’s backing federal climate-change legislation.

>> A cap-and-trade system would give carbon “credits” to polluters and require them to buy or trade for credits when they exceed their carbon emission limits.

>> Because Avista relies heavily on “clean” hydropower, it doesn’t want to be penalized if federal cap-and-trade legislation comes to pass, while heavily polluting energy companies are treated more leniently.

Avista Corp., which gets half its energy from hydropower dams, has joined other clean-energy providers, retailer Gap Inc. and Colorado resort operator Aspen Skiing Co. to form a new lobbying group for federal climate-change legislation.

Avista is one of the 20 founding members of American Businesses for Clean Energy, which started up earlier this month. The group’s goal is to unite diverse business interests to support cap-and-trade legislation, which would limit carbon emissions and other greenhouse gases.

“We’re unified by a need to put a price on carbon. … The reason this work needs to be done is that the planet is in peril,” said Ralph Izzo, chief executive of the Public Service Enterprise Group, a New Jersey utility that is part of the effort. “The economy can’t afford not to do this.”

American Businesses for Clean Energy formed at the suggestion of the Natural Resources Defense Council, an environmental group that urged companies that don’t support the U.S. Chamber of Commerce’s adversarial position on climate legislation to step up and be vocal. Several well-known companies, including Apple Inc., recently left the chamber over its stance on climate legislation. The U.S. Chamber says a House climate change bill would drive up energy costs and put American industries at an economic disadvantage.

Avista hasn’t been a U.S. Chamber member for nearly 20 years.

The Spokane-based utility is active on climate change issues, said Tom Paine, Avista’s director of government relations.

As a utility with a small carbon footprint, Avista could benefit from climate-change legislation, Paine said. The utility already sells credits from a wood-burning biomass plant in Kettle Falls, Wash., on the Chicago Climate Exchange.

At the same time, Avista and similar utilities don’t want to be penalized by upcoming legislation for starting out with low carbon emissions, Paine said.

A cap-and-trade system would give carbon “credits” to polluters but requires them to buy or trade for credits when they exceed their carbon emission limits.

“We didn’t want all those (credits) going to big emitters,” Paine said. If that occurred, Avista customers could see a spike in energy prices, he said. “During the summer, when our hydro production is low, we would have to buy additional (credits) from these big polluters.”

Avista is a member of two other lobbying groups – the Clean Energy Group and Edison Electric Institute – that advocate splitting the credits equally between big emitters and utilities with low carbon footprints.

Paine said it’s unlikely that cap-and-trade legislation will pass this year, but it’s possible in 2010. Avista would prefer national climate legislation to a patchwork of laws adopted by states or regulations enacted by the U.S. Environmental Protection Agency, he said.

Stalling action on climate-change legislation puts the U.S. behind other countries, which already invest heavily in low-emissions technology, said Izzo, the New Jersey utility’s executive.

“The entire supply chain for renewable energy is developing overseas while we sit and wait,” he said. “Our conversations about new nuclear plants are taking place with people from China, not the U.S. … Our offshore wind efforts involve stuff taking place in the North Sea.”

Action on climate change is important to other industries as well, members of American Businesses for Clean Energy said during a conference call earlier this month.

Gap Inc. buys cotton from many countries. Global warming could disrupt water supplies for irrigation and limit sources of raw materials, said Kindley Walsh Lawlor, Gap’s senior director of global responsibility.

The outdoors industry is also concerned. Frost-free days are becoming fewer at Aspen, and warmer nights make it difficult to manufacture snow at one of the nation’s premier ski resorts, said Auden Schendler, the resort’s executive director for sustainability. Winter sports are a $2 billion industry in Colorado and a big economic driver in many other parts of the West, he said.

“If you knock March off of the ski season, the whole ski industry goes out of business,” Schendler said. “We’re a fragile industry.”


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