September 22, 2010

Renewable power vote could come in U.S. Senate this year

The U.S. Senate should take up legislation after the November elections that would require utilities to buy more electricity from renewable sources such as wind turbines, Senator Jeff Bingaman said.

Bingaman, a New Mexico Democrat who introduced the legislation today, told reporters in Washington he will “develop support” for the bill and push for a vote “in the lame-duck session when we come back after the election.”

Bingaman’s “renewable electricity standard” would require utilities to obtain as much as 15 percent of their power from low-pollution sources by 2021. The U.S. renewable energy sector is a potential “job engine” and the national standard will “fuel it,” said Senator Sam Brownback, a Kansas Republican and a cosponsor of the bill.

A renewable electricity standard requires utility companies to produce or purchase some of their power from wind turbines, solar panels and other sources that pollute less than plants fueled with oil, coal and natural gas.

A credit, or certificate, is awarded for every megawatt- hour generated from renewable sources. To comply with the renewable standard, utilities have to surrender a target number of credits each year. Companies with more credits than they need can sell to those that are short.

Good Timing
Bingaman’s push to get a renewable mandate passed this year “couldn’t come at a better time” as the U.S. economy struggles to create jobs and recovers from the worst recession since the 1930s, Denise Bode, chief executive officer of the American Wind Energy Association, told reporters on a conference call. “America needs jobs and more clean energy resources,” Bode said.

Some of the targets can be met through energy-saving measures rather than purchases of renewable electricity or credits, according to a summary of the bill. Utility companies could also make an “alternative compliance payment” of $21 for every megawatt-hour they fall short of their renewable target, according to the summary.

Investment in renewable energy sources has the potential to “reinvigorate” the U.S. manufacturing sector, Lisa Jacobson, president of the Business Council for Sustainable Energy, said in an e-mail. Without a U.S. mandate to bolster demand for cleaner power sources, renewable energy investors are “sitting on the sidelines,” Jacobson said.

Last year, the U.S. House passed a renewable electricity standard as part of a bigger bill to cap carbon dioxide and other greenhouse gases scientists have linked to climate change. The House bill, which set a renewable standard of 20 percent by 2020, stalled in the Senate.

Energy Legislation
In July, Senate Democrats considered adding a renewable standard of 15 percent by 2021 to energy legislation that responded to the BP Plc oil spill in the Gulf of Mexico. The renewable standard was dropped from the oil-spill bill, which failed to get a vote before lawmakers left Washington in early August for a monthlong break.

The renewable electricity standard, or RES, has “near-zero odds” of becoming law this year, partly because of “partisan rancor” before November’s congressional elections, Kevin Book, managing director at ClearView Energy Partners LLC, a Washington-based policy analysis company, said in a report today.

It won’t be any easier for a national renewable mandate to pass the Senate than the House climate-change bill, which would limit greenhouse gases with a cap-and-trade system, George Voinovich, an Ohio Republican, told reporters. “You’re going to have as much controversy about the RES as you had over cap and trade,” Voinovich said.

Brownback disputed that prediction and said the renewable power proposal should attract “strong bipartisan support” because “it’s not cap and trade.”

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