Looking to future generation
BOISE – Idaho must stop relying primarily on power from coal and hydroelectric turbines and turn to conservation and local sources of renewable energy, according to a state energy policy unveiled last week.
But unlike plans in some nearby states, Idaho’s policy does not dictate how much of its supply must be renewable. Instead, it suggests incentives to go green while leaving specific action to potential future legislation.
Panhandle legislators who helped shape the policy and utility representatives favor the light-handed approach, saying power providers are already diversifying and firm targets would interfere with market forces.
“The intent is for us to be able to meet the energy needs of our Idaho citizens both in terms of energy stability and cost,” said Rep. George Eskridge, R-Dover. “In my mind, at least, the cost of energy is a driving economic consideration in terms of Idaho’s economic future.”
Some conservationists and renewable resource advocates say they agree with the plan’s priorities but believe it lacks teeth.
“This plan, while it talks the right talk, it really doesn’t get us to where we need to go,” said Ken Miller, a lobbyist for the nonprofit NW Energy Coalition.
The first energy policy update in 25 years, the 93-page document urges incentives to increase ethanol use, create renewable energy sources and upgrade transmission capabilities.
The Legislature last year ordered the 16-member Legislative Council Interim Committee on Energy, Environment and Technology to update the policy in response to Sempra Generation’s plans to build a 600-megawatt coal-fired power plant in Jerome County. Local opposition led to a two-year statewide moratorium on new coal-fired plants.
The policy is intended to frame legislation, Eskridge said. Lawmakers already are working on ethanol and plant-siting bills.
Lawmakers emphasized conservation as the most cost-effective way to cut energy needs.
Energy cost Idaho roughly $3 billion in 2003. Because the state does not produce coal, oil or natural gas, it imports the majority of its fuel and roughly half of the electricity used by Idahoans.Yet as of 2005, Idahoans paid the nation’s second-lowest average electricity and sixth-lowest natural gas prices because of access to cheap hydroelectricity and nearby natural gas reserves.
In 2005, the state received 48 percent of its power from hydroelectricity, 42 percent from out-of-state coal generation and 8 percent from natural gas. Just 1 percent came from renewables.
Although the new policy calls for increased use of renewables, it sets no targets.
“If you can put a wind farm out on a farmer’s land, you generate more income for that farmer, you generate employment. You have a resource there that’s providing more than just energy, it’s providing economic benefits,” Eskridge said. “And once again, environmentally, it’s more acceptable than perhaps a coal plant.”
Renewable electricity sources will account for about 8 percent of Idaho energy in 2015 based on utilities’current plans, according to the energy document.
Nearby states expect similar usage, but some have set larger long-term goals.
Washington voters in November approved an initiative requiring 3 percent of electricity generated by utilities that serve more than 25,000 customers be renewable in 2012, increasing to 15 percent by 2020.
Pushed by Gov. Ted Kulongoski, the Oregon Department of Energy has drafted a plan calling for renewable generation to meet 10 percent of Oregon’s needs by 2015 and 25 percent by 2025.
Montana’s Legislature mandates 15 percent and Nevada law requires 20 percent by 2015, according to the U.S. Department of Energy. Wyoming and Utah have no targets.
Cost is the “principal barrier” to investment in renewables, according to the policy. Arne Olson, a senior consultant for San Franciso-based consulting firm Energy and Environmental Economics who helped prepare Idaho’s plan, said the committee was “fundamentally uncomfortable” with targets.
Legislators wanted to avoid jumping into an untested program like Montana did when it tried deregulating energy providers, Olson said.
“But on the other hand, a lot of states have kind of a desire to push the envelope a little bit and maybe are willing to incur some higher costs early on if the goal is trying to drive down the costs in the long run,” he said.
It’s unlikely Idaho’s Legislature will ever pass firm targets, said Miller, the NW Energy Coalition lobbyist.
“There’s a lot of room for improvement here,” he said.
Sen. Kate Kelly, D-Boise, a committee member, said incentives are the best option because Idaho’s policy lags behind that of Oregon and Washington.
“You usually try the carrot before the stick, and we haven’t even done that,” Kelly said.
The policy includes an income tax incentive for investment in customer-owned renewable generation, low-cost state financing for consumer-owned renewable generation and shareholder incentives by the Idaho Public Utilities Commission for investment in renewables.
State government currently offers a maximum income tax deduction of $20,000 for certain renewable energy devices, a sales tax exemption for renewable electricity generation sources used to produce at least 25 kilowatts and a bond program for non-utility firms to build renewable energy plants.
Courtney Washburn, of the Idaho Conservation League, said the plan is a good first step because it spells out energy priorities. Previously, “I’m not sure we were on a clear path,” Washburn said.
Rep. Eric Anderson, R-Priest River, said some utilities, such as Northern Lights, already offer “green tag” programs in which consumers agree to pay more for electricity from alternative sources.
Olson said consultants proposed that state government assume control of conservation efforts from utilities, an idea legislators declined. Many lawmakers initially were reluctant to change anything, he said.
“One of our functions as consultants was to try to maybe push them a little farther than maybe they’re comfortable going,” he said.
The interim committee finalized the draft plan Thursday, sending it to environmental committees in both houses for public comment.
“It satisfies nobody, and in that aspect it’s probably a good product,” Eskridge told lawmakers after the vote.
The plan includes a recommendation that the Legislature revisit it every five years.
“We’re hoping that this one doesn’t get put on the shelf like the last,” Washburn said.