RPS Utility Trepidation Unfounded

Contrary to utilities’ common perceptions, states committed to developing more renewable energy have found it costs less than expected and typically saves money, according to researchers and consultants who have helped craft such legislation.

Their experience stands in contrast to the concerns of Xcel Energy, which claims that Colorado’s Amendment 37 will raise utility rates. The amendment would require that the state’s larger utilities get a certain amount of their energy from renewable sources like wind or solar power. “This assertion is totally unsupported by actual experience,” said Jon Wellinghoff, author of Nevada legislation requiring utilities get 15 percent of the energy they sell from renewable sources by 2013. Before the Nevada legislature unanimously adopted its renewables bill, said Wellinghoff, utilities were claiming their costs would go up $300 million. They have since testified to the Nevada Public Utilities Commission that they expect their first renewable contracts to save them $15 million over 20 years. Mark MacLeod saw a similar pattern when he helped broker a renewable measure that passed in Texas in 1999. Utilities and industrial customers resisted it at first, then realized it saved money as large wind developments created economies of scale in site preparation and equipment pricing. Texas quickly exceeded its renewable energy targets and is now one of the leading wind power markets in the country. Wind power in Texas now costs less than gas-fired power, said Mike Sloan, who also helped craft the Texas renewable standard. In California, where a renewable measure was enacted in 2002, early proposals for renewable measures are coming in at a low enough cost that utilities will not need to tap public funds available under the law, said Ryan Wiser of the Lawrence Berkeley National Laboratory.
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