RES: Saves $, Creates Jobs … Duh By Tom Gray (AWEA)

OK, so we have been beating the drums for a while about a national Renewable Electricity Standard–talking about how it will save consumers money, create jobs, and help build a clean renewable energy industry in the U.S. Who cares? We’re the wind energy industry, and wind power is renewable, so obviously we think it’s a good idea.

Now comes the Chair of the Public Service Commission of Wisconsin (PCSW), the regulatory agency that oversees that state’s utility industry, and guess what? He thinks the same thing.

Chairman Eric Callisto’s letter on the effects of a renewable electricity standard responds to a request from three legislators. The three asked for "a Commission analysis of the expected costs to utilities and ratepayers of meeting a 25% by 2025 Renewable Portfolio Standard (RPS) as proposed in the Clean Energy Jobs Act."

Comments Chairman Callisto, "As I have testified to both the Assembly and Senate Select Committees, the electric utility sector policies in the proposed legislation – namely, the enhanced RPS and energy efficiency provisions – represent sound energy policy for Wisconsin. The Commission’s analysis shows that if we continue with business as usual, if we decide to do nothing, we are taking on great financial risk in a changing world, and our ratepayers will be leaving substantial dollars on the table.

"As our nation recovers from the worst economic crisis since the Great Depression, we of course must continue to support Wisconsin’s bedrock industries like agriculture and manufacturing. But we must also position Wisconsin to lead in emerging sectors like clean energy. Numerous third party reviews, independent studies, and industry recognized research all show that the Clean Energy Jobs Act will create more than 15,000 net new jobs in Wisconsin, not just in new fields, but in construction, manufacturing, forestry, and agriculture …

"Across the state, companies like Virent, Johnson Controls, Orion Energy, Wind Capital Group, Waukesha Electric, ZBB Energy, Helios USA, Cardinal Glass, Renewegy, Nature Tech, Energy Performance Specialists, Tower Tech and many others provide good jobs for people producing alternative forms of energy. None of these companies would be producing these jobs without good public policy, aggressive energy efficiency efforts, and renewable energy standards."

There’s more–nearly eight pages, detailing the Commission’s analysis of the proposed statute and noting that a conflicting study by the Wisconsin Policy Research Institute and Beacon Hill Institute is "of near zero value," due to an inadequate series of assumptions. But the central message is clear enough, and is underlined for emphasis by Chairman Callisto: "[W]e will in all likelihood be spending more on electricity in the long run if we don’t act now and enact enhanced renewable portfolio standards and take more aggressive action on energy efficiency."

By Tom Gray,

What Is a Renewable Electricity Standard?

The Renewable Electricity Standard (RES), also known as a Renewable Portfolio Standard (RPS), is a flexible, market-driven policy that enables renewable energy sources, such as wind energy, to provide the clean, reliable, domestic power the U.S. needs. An RES ensures that some amount of renewable energy is included in the portfolio of electricity resources serving a state or country.

25% Renewable Electricity by 2025

A national standard of 25 percent renewable-based electricity by the year 2025 offers a least-cost, marketfriendly way to ensure that we meet an increasing share of America’s growing electricity needs with clean, domestic energy resources. Wind power and other renewable energy sources are currently available, rapidly deployable and cost-effective options to reduce greenhouse gas emissions.

Why is a National RES Needed?

TO CREATE A LONG-TERM AND STABLE MARKET FOR CAPITAL INVESTMENT: The long-term predictability of an RES will enable the industry to attract investment capital and achieve manufacturing economies of scale that will spur economic development, lower consumer prices, strengthen U.S. energy security, and help our environment.

TO FULLY ACCESS THE RICH RENEWABLE RESOURCES IN THE U.S.: The 28 individual state RES programs have helped jump-start renewable development in the U.S., but a national program is necessary in order to take advantage of the ample renewable resources that exist across the U.S. and to allow all states to enjoy the benefits of renewable energy development.

TO PROVIDE A DOWN PAYMENT ON CLIMATE CHANGE GOALS: A national RES will deploy currently available clean technology and create immediate emission reductions in a cost effective manner. To achieve the significant emission reduction goals needed for climate stabilization, a suite of several complementary policies will be needed, and the national RES is a critical first step with an immediate impact on our emissions levels.

What are the Benefits of a National RES?

SAVES AMERICAN CONSUMERS MONEY AND PROTECTS AGAINST FUEL SPIKES: Diversifying the power supply by developing America’s homegrown renewable energy resources would help shield consumers from spikes in energy prices. According to a major study by a widely respected energy research firm, a national RES would save American consumers as much as $100 billion in lower electricity and natural gas bills.

REDUCES GREENHOUSE GASES AND POLLUTION COST EFFECTIVELY: A 25% RES by 2025 could reduce our CO2 emissions by 20% by 2020 putting the U.S. on the path to meet an emission reduction goal of 1990 levels by 2020.

SPURS ECONOMIC DEVELOPMENT: A national RES would create jobs and increase income across the country, especially in a economically hard-pressed rural areas and regions that have depended on traditional manufacturing. Each large utility-scale wind turbine that goes online generates over $2 million in economic activity.

Jobs: Wind energy is an important source of new manufacturing jobs. The wind energy industry contributes directly to the economies of 46 states with power plants and manufacturing facilities. In 2008, the wind industry opened, expanded, or announced 55 manufacturing facilities, and generated 35,000 jobs. Overall, more than 85,000 American jobs in manufacturing, construction, operations and services reflect the wind industry’s continuing growth. The CEO of GE Energy, John Krenicki, Jr., recently testified that “We believe wind power and solar energy are likely to be among the largest sources of new manufacturing jobs worldwide during the 21st century.” A Union of Concerned Scientists (UCS) study found that a 20% RES by 2020 would create over 185,000 jobs.

Income & Tax Base: Each wind turbine provides about $5,000 in lease payments per year for 20 years or more to farmers, ranchers or other landowners. According to the UCS, a 20% national RES would result in approximately $1.2 billion in lease payments to farmers and rural landowners by 2020. Wind farm projects in rural areas also significantly contribute to the local tax base. One large (108-turbine, 162-MW) project in rural Prowers County, Colorado, increased the county’s tax base by 29%.

A National RES is Achievable in All Regions of the Country

ENERGY RESOURCE POTENTIAL: There is more than enough renewable energy potential in the U.S. to generate 25% of our electricity from renewable sources from a wide range of energy resources including coal reservoirs, oil and gas fields, strong wind and solar resources, geothermal fields, and access to biomass. There are more than eight million MW of wind resource potential on land, which is roughly eight times the current installed electric generating capacity for all energy resources. However, our nation’s energy resources are distributed unevenly across the country, with no single energy resource reaching all corners. Thus, states must be interdependent for their energy sources.

Wind is already one of the most widely available energy resources across states, with developed resource in over 35 states. Although wind resources cannot be transported by rail or pipeline, the electricity wind produces can be transported by transmission lines. For example, while the Southeast region of the country has biomass and offshore wind resources, its onshore wind resources are less than ideal. However, a proposed transmission expansion plan by the Southwest Power Pool could bring the Southeast significant wind resources from the wind-rich central plains. Instead of importing coal and gas from other states, as it currently does, the Southeast could import clean and renewable wind power. This has already occurred across the Oklahoma-Arkansas border, where strong Oklahoma wind connected to the Arkansas electric system has provided a cost savings to Arkansas ratepayers, with the fuel savings from wind in 2007 alone offsetting the cost impact of the wind project.

RENEWABLE ENERGY DEVELOPMENT: There are close to 300,000 MW of wind energy projects under development at various levels which have applied for access to the transmission grid. The national RES would provide the long-term stable market and the incentives to upgrade and expand the transmission infrastructure which will allow these proposed projects to move forward.