Southeastern Utility Commissioners to Congress: RPS Means Higher Prices for Consumers

Nine SE States Urge Congress to Reject Federal RPS

June 6, 2007
04:44 PM
           WASHINGTON – The State Utility Commissions of nine southeastern states have sent a clear message to Congress: a federal renewable portfolio standard (RPS) will mean higher prices for consumers.
            In a letter to chairman Jeff Bingaman and ranking member Pete V. Domenici of the Senate Energy and Natural Resources, and chairman John Dingell and ranking member Joe Barton of the House Energy and Commerce Committee, the public utility commissions of Alabama, Arkansas, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, and Tennessee warn that a federal RPS mandate fails to recognize the variety of resources available to states, a theme echoed by Domenici.
            The letter notes that traditional renewable energy sources such as wind energy are not widely available in the southeast, which will mean that utilities in those states would be forced to buy credits from the federal government.  The utility commissioners point out that while over 20 states and the District of Columbia have adopted state RPS standards, states have included a wider array of energy sources in their definitions of eligible renewable resources than the proposed federal RPS.
            “As the Senate considers an RPS amendment over the coming weeks, I believe we should take the concerns raised by the state utility commissions in the southeast very seriously.  The federal RPS mandate is more narrowly defined than those adopted by states.  It should be the other way around.  It is unfair to expect states that simply don’t have renewable energy resources available to them to meet the limited RPS mandate,” Domenici said.
            “A clean portfolio standard like the one I’m working on would avoid this problem.  It would still require states to use clean energy sources—and therefore lower their emissions—but it would allow states to tailor their energy sources according to what works best for them, whether it’s wind, solar, nuclear, fuel cells, hydropower, or through energy efficiency,” Domenici said.
            State utility commissions are responsible for ensuring that retail electricity consumers receive affordable, reliable electric service.
            The letter, sent by the Southeastern Association of Regulatory Utility Commissioners and signed by representatives of the nine states listed above, reads in part:
            “The reality is that not all states are fortunate enough to have abundant traditional renewable energy resources, such as wind…this is especially true in the Southeast and large parts of the Midwest. 
            “Because of the limited availability and cost-effectiveness of traditional renewable energy resources, we are deeply concerned that our utilities will be forced to buy renewable energy credits from the federal government.  Correspondingly, our retail electricity consumers will end up paying higher electricity prices, with nothing to show for it.