Using cheap natural gas as a shield, ALEC has picked up the pace of Renewable Portfolio Standard (RPS) repeals.
16 out of 30 states that have an RPS are now looking at paring them back or eliminating them.
Last week, we reported that
North Carolina was one of a handful of states moving in this direction. Legislation is expected to pass that dilutes and then eliminates its RPS.
And this is after the boom in renewable energy and jobs that North Carolina’s RPS has caused. The state came in 4th in the US last year for new solar installations, adding 132 megawatts (MW), and is among the 10 states that have over 100,000 green jobs.
"We’re opposed to these mandates, and 2013 will be the most active year ever in terms of efforts to repeal them," Todd Wynn, task force director for energy at ALEC told Bloomberg. "Natural gas is a clean fuel, and regulators and policy makers are seeing how it’s much more affordable than renewable energy."
ALEC says natural gas fracking has cut prices 72% since 2005, making "more expensive" wind and solar projects harder for utility regulators to justify.
The free market should determine which kind of energy gets used, not state mandates, says ALEC.
Heartland Institute is also involved, arguing that RPS mandates raise energy costs, cost jobs and do little to improve the environment.
"We expect in the next year or two that state-based incentives will disappear," SolarCity CEO Lyndon Rive told Bloomberg. Whenever you see the effort, peel the onion and find out who’s behind it, who’s funding the effort. It’s very annoying that people can get away with the shell efforts and call it the people’s voice when
it’s funded by coal."
Various strategies are being used to roll back RPSs.
A creative tool is being deployed in Connecticut – instead of cutting back the RPS directly, which requires utilities to source 20% of energy from renewables by 2020, a bill would allow hydro to be included. That means much less "true" renewables would be needed to meet the mandate.
"Connecticut has thrown up the white flag on its ambitious renewable targets, and is now negotiating its terms
of surrender," says Nick Culver of Bloomberg New
Energy Finance. "Instead of simply easing back targets, they intend to widen eligibility criteria to include imported hydropower from Canada that would have been built regardless, which amounts to pretty much the same thing."
In Colorado, a bill is moving through the legislature that would actually expand the RPS for electric coops to 25% by 2020, up from 10%. But even that bill expands the definition to include non-renewable sources such as methane produced from coal
Missouri, Ohio and Kansas are considering similar measures. In all, there are 30 proposed bills in 16 states that could significantly affect demand for renewable energy, according to the North Carolina Solar
According to Carrie Hitt of Solar Energy Industry Association, the wind and solar industries are actively fighting these efforts.
"This is a deliberate campaign
by conservative think- tanks, the Heartland Institute and Alec to overturn
renewable energy policy that threatens the fossil industry," she told Bloomberg.
Meanwhile, states are meeting or exceeding RPS targets and will have increasing surpluses of renewable energy beyond those targets by 2040 as they "become increasingly competitive with conventional generation sources," says the U.S. Energy
Without RPSs, these surplus would not occur. "State RPS
policies may encourage investment in places where it otherwise would not occur, or would not occur in the amounts projected, even as other parts of the country see substantial growth above state targets."
Wind Energy Already Competitive
Meanwhile, utilities in southeastern states are finding Midwest wind power to be among the cheapest available energy sources on the market.
A few months after beginning to import wind energy from Oklahoma, Alabama doubled its purchase because it’s so inexpensive.
Now, Georgia Power announced it will import 250 megawatts of wind energy from Oklahoma starting next year. It also beginning to invest in solar.
The Tennessee Valley Authority has signed 10 wind power
purchase contracts, bringing in at least 1,500 MW of wind as of 2012.
While natural gas may be cheap for now, that will likely not last. The latest reports show developers are exaggerating the amount of production that’s available, and in any case, prices will be volatile.
One thing’s for sure about solar and wind. Once the projects are operating, the cost for energy is reliable and stable. Unlike natural gas fracking, which uses billions of gallons of water, wind and solar do not – another important consideration in farming areas.