Wednesday, May 8, 2013

The People who Cast the Votes decide Nothing…

Last week the North Carolina General Assembly proved true the old aphorism about counting votes: it is the people who count the votes who decide everything, not those who cast them.  For the better part of the past decade, North Carolina utilities have been complying with a piece of legislation referred to as Senate Bill 3, which included among other provisions a renewable portfolio standard provision or RPS.  This provision of legislation was enacted after a lengthy process of negotiation which arrived at a consensus RPS.

North Carolina’s  RPS has been wildly successful as well explained by Robin Smith’s excellent blog.  By every measure you can reckon, the RPS has achieved a number of important long term objectives.  The only people who do not like the REPS appear to climate change deniers, young earth creationists and John Locke Foundation columnists.  In other words, the base of the current legislative leadership objects to North Carolina’s RPS because it violates their hobby horse theories about renewable energy generally.  The facts do not support their claims.

The original bill capped the RPS costs to consumers at $1 per month.  Please note that this type of cap does not apply to any other form of energy subsidized by Utilities Commission.  Contrary to statements by Senator Harry Brown, all forms of energy used by state-regulated utilities are subsidized by the regulated monopoly structure of our Utilities Commission.  Any investments by utilities in generation assets are subsidized by rates paid by all customers set by the Commission including a profit margin for the utilities constructing the plants.   

Now that consensus is under attack, including some people who voted for the original bill.  The opponents of the RPS lost a key vote two weeks ago.  Rather than making their case, they ran the same bill again and this time the Chairman of the Committee declared that the ayes had it on a voice vote and gavelled the meeting closed before recognizing members who objected.    

First, the REPS has increased the percentage of energy that is produced entirely in North Carolina.  This has positive economic effects throughout North Carolina.  Most of the new solar installation has been done by North Carolina’s small businesses in the energy sector.  FLS Energy of Asheville has grown steadily, investing more than $70 million into North Carolina and creating scores of jobs.    Some of this growth is due to the RPS, but much of it is driven by demand from industry and the military.

Second, the REPS has kept costs down of electricity for consumers.  Duke Power filed application to rebate customers money due to the lower costs of implementation than expected.  Instead of hitting the $1 per month cap promised, the utilities have placed 3% of their electricity into renewables for less than $.25 per month and the cost is going down, hence the rebate. 

New power plants using coal or nuclear fuel are very expensive to construct.  These plants only make sense to build for very large increases in demand as they can only be built on a large scale.  The REPS allows utilities to recover costs for meeting smaller increases in demand as they occur, rather than forcing all customers to pay now for demand that may not come for decades.  North Carolina utilities which invested too heavily in nuclear plants in the late 1970s have foisted a large bill on their customers that still lingers today.  These customers would love to have seen increases to their monthly bills limited as the REPS was to less than a dollar a month.

Third, the REPS has environmental benefits that are impressive.  Many miles of North Carolina’s surface waters are impaired for mercury contamination.  This mercury contamination makes fish unsafe to eat and damages the nervous systems of fish themselves.  A significant amount of mercury comes from burning coal.  Nuclear plants in the United States produce prodigious amounts of high level radioactive waste.  No safe place to store that waste has been found.  Instead, we keep it piling up at our active nuclear power plants.

Solar energy does not emit mercury.  Nor does it produce radioactive waste.  It is far more efficient and far more reliable than it was twenty years ago.  Growing economies are embracing the solar technology as they expand.  So why is Senator Brown opposed to solar?   His constituents include many active duty Marines.   The Marine Corps has invested heavily in solar energy in order to protect soldiers’ lives.  There is now healthy service rivalry over who can develop the best solar systems.

Some see little to gain from the solar revolution and are using politics to stop it in the United States.  Solar is not vulnerable to the supply disruptions or price market manipulation as commodity-based energy swings.  OPEC cannot cartel the Sun.  Investment banks have not figured out how to tranche the Sun.  No one has yet taken a hedge position on the Sun.   

It is more dangerous than voter fraud because the result actually subverted the will of the elected majority on that committee.  A single voter cannot swing a major election.  A single chairman can swing a bill through and has done so, blatantly disregarding the principles of one person, one vote in the General Assembly itself. 

Besides, solar energy is patriotic.  Oorah!

1 comment:

  1. Great post! The General Assembly is always good for laughs or tears depending on whether it is viewed as a soap opera or real life. I look forward to keeping up with the blog!