When the 146th General Assembly resumes its work next month, energy issues promise to be at the forefront. In light of recent developments, I believe that two bills currently tabled in the House Energy Committee need to be re-considered.
The first, House Bill 27, could have implications for the more than 75,000 members of Delaware Electric Cooperative, as well as tens-of-thousands of additional homes served by the nine Delaware municipal electricity utilities.
Under a state law enacted in 2010, 25-percent of the electricity Delmarva Power delivers to its customers must come from renewable sources by 2025. Neither the Delaware Electric Co-op, nor the nine municipalities, are subject to that provision. However, they must still submit to state officials a comparable plan to increase the use of electricity from renewable sources.
House Bill 27 seeks to allow the Co-op and municipalities to “utilize conservation, energy efficiency and demand-side management programs” to comply with the state’s green energy mandate.
The Co-op has been very active in promoting conservation measures. Its nationally-recognized “Beat the Peak” program alerts consumers as to when electricity rates are at their highest levels, giving them an opportunity to voluntarily decrease electricity use. Not only does this reduce pollution by avoiding the need to bring additional generating resources online during periods of peak usage, it has also been effective at keeping the Co-op’s electricity rates about 36 percent below the state’s residential average.
The Co-op has also installed smart meters on members’ homes, at no added expense, to more effectively manage power distribution and usage.
This is not to say that the Co-op is seeking to avoid the use of green energy. In fact, the organization has been expanding its renewable energy portfolio, which is currently at about seven percent.
Earlier this year, the state enacted legislation (Senate Bill 124 w/SA1) to allow Delmarva Power to use electricity produced from Bloom Energy fuel cells to be counted towards meeting its state-mandated requirement for using more renewable energy. These fuel cells, which will use natural gas, will be made at a new facility in Newark. This sizable concession was one of the keys to securing that manufacturing plant for Delaware.
I was one of four House members to vote against the “Bloom Energy Bill,” in part, because I saw it as inequitable. Now that it’s been enacted, that fairness issue is more apparent than ever. If it is acceptable to allow Delmarva Power to count electricity produced from non-renewable, fossil fuel as meeting its renewable energy requirement, then the Co-op and municipal utilities should be allowed to use conservation measures, which actually are “green,” to meet that same mandate.
Making comments before the House Energy Committee earlier this year, Department of Natural Resources and Environmental Control Sec. Collin O’Mara recognized the value of the Co-op’s conservation efforts: “We want to reward the co-op because they’re doing the right thing and I get that.”
It’s time not only to release House Bill 27, but to enact it into law, giving the Co-op and the municipalities the consideration they have earned.
The second bill (House Bill 86), currently in legislative limbo in the Energy Committee, is a bill I sponsored that seeks to terminate Delaware’s participation in the Regional Greenhouse Gas Initiative (RGGI) — a 10-state “cap and trade” compact designed to reduce carbon dioxide emissions from large power plants. After capping emissions levels, the states auction off emission allowances and invest proceeds in energy programs.
The Regional Greenhouse Gas Initiative, Inc. — a 501(c)(3) non-profit corporation — issued a report in February indicating that between mid-2008 and the end of 2010 member states reaped collective revenues of $789.2 million from the auctions. Delaware’s share of this has been more than $18.8 million, which the RGGI report says the state is using to invest in “innovative energy efficiency and renewable energy programs administered by the Sustainable Energy Utility (SEU).”
While the goal of the RGGI is well-intentioned, events that have occurred since the program began in 2008 have rendered it unnecessary.
Changes at three Delaware power plants in recent years will result in those facilities producing 30 to 40 percent less CO2 by 2014, which will far surpass the RGGI target of a 10 percent reduction by 2019. Add to that the recent announcement by NRG Energy to replace a coal-fired generator at its Dover facility with a cleaner and more efficient natural gas turbine.
When the RGGI was begun three years ago, natural gas prices were on the rise. Since then, natural gas from a huge reserve in nearby Pennsylvania has come onto the market, dropping prices and increasing its attractiveness as an alternative to coal. Accelerating that trend are new EPA anti-pollution rules that will make coal-produced electricity considerably more expensive, hastening the switch to cleaner natural gas turbines.
According to research done by the Caesar Rodney Institute, maintaining Delaware’s unneeded participation in the RGGI could add $15 million to $35 million to the collective annual cost of providing power to Delawareans as the consequences of the program are fully realized.
It’s time we ended our participation in this needless relic, which is serving no purpose other than to senselessly drive energy prices up for our residents and businesses. To not do so would only acknowledge that the program functions solely to levy a stealth tax for funding the pet green energy initiatives of the current administration.
Jack Peterman represents the 33rd district in the Delaware House of Representatives.