Mid-term Elections and Discussion of a Federal Renewable Portfolio Standard

Mid-term elections are here. Time for a quick poll. Suppose I'm running for Congress. Which campaign platform would you recommend? You can vote for me because I will fight to:

a) Protect women's reproductive rights, put honesty back into government, return power to the voters, and end tax-payer bailouts for the super-rich.

OR

b) Establish a federal renewable portfolio standard (RPS), even though it is fiercely opposed by the utilities who, in a deregulated environment have used their cozy relationships with the FERC-appointed quasi-governmental agencies to hide profits and create an environment in which only a fraction of clean energy is contracted for purchase at retail net metering rates, thus quietly but effectively removing incentive for capital formation in solar, wind, and other clean energy technologies.

If you picked a), you have what it takes for a career as a political speechwriter. If you picked b), I'd advise you to head in another direction.

Kidding aside, this is the exact situation in which we find ourselves at this point. Without a federal RPS, the states have the power to create an extremely anti-competitive environment for clean energy. In New Hampshire, to take an example, the state will let anyone with a power source under one megawatt connect to the grid with a minimum of hassle.

Sound good? Well, there's a catch.

The utilities don't have to buy anything over 100 kilowatts (90% of the project) at retail net metering rates, but rather at wholesale rates (less than 6 cents per kilowatt hour). Thus a project that appears to have a reasonably attractive 16% internal rate of return, actually comes in at a dismal 5.5%. Once they realized that, investors didn't walk away from those projects (that entrepreneurs had spent millions of their own dollars developing) – they ran.

All this garbage needs to go away. In the absence of a federal RPS, all this stuff is slowly going nowhere.

If you vote for me, I'll make that happen. I'll also protect women's reproductive rights, put honesty back into government, return power to the voters, and end tax-payer bailouts for the super-rich.

 

Craig Shields is editor of 2GreenEnergy.com, and author of Renewable Energy - Facts and Fantasies (published by Clean Energy Press - 2010)

--
Scott's Contracting
scottscontracting@gmail.com
http://www.stlouisrenewableenergy.blogspot.com
http://www.stlouisrenewableenergy.com
scotty@stlouisrenewableenergy.com