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Mandates on renewable power raised prices

Morning Sentinel|Kenneth Fletcher|May 21, 2011
MaineTaxes & SubsidiesEnergy Policy

The Maine Public Utility Commission's analysis showed that the first two years of the increased renewable energy mandate added $7 million to Maine ratepayer's electric bills. Rather than continue the automatic increases to the renewable energy source mandate, we think there is a better approach by allowing consumer choice while still supporting renewable energy development.


The paper's May 13 article, "Power Struggle Looms in Augusta," will hopefully be the first of many reports about the importance of reducing energy and electricity costs to Maine consumers.

While some seem to suggest that electric prices are not as important as mandating the use of "green" energy and subsidizing developer's projects, Gov. Paul LePage believes that all three of these goals can be achieved. But we can no longer unnecessarily keep passing the bill on to the Maine people.

According to the U.S. Energy Information Administration, Maine people pay the 12th highest electricity rates in the nation. Maine's own Economic Growth Council identified that retail electricity prices were 16 percent higher than the national average in 1990, rising to 42 percent higher than the national average in 2008.

Businesses give great consideration to the cost of energy when making location and expansion decisions, notes the Economic Growth Council. High electricity prices negatively affect job growth and put the ... more [truncated due to possible copyright]

     

The paper's May 13 article, "Power Struggle Looms in Augusta," will hopefully be the first of many reports about the importance of reducing energy and electricity costs to Maine consumers.

While some seem to suggest that electric prices are not as important as mandating the use of "green" energy and subsidizing developer's projects, Gov. Paul LePage believes that all three of these goals can be achieved. But we can no longer unnecessarily keep passing the bill on to the Maine people.

According to the U.S. Energy Information Administration, Maine people pay the 12th highest electricity rates in the nation. Maine's own Economic Growth Council identified that retail electricity prices were 16 percent higher than the national average in 1990, rising to 42 percent higher than the national average in 2008.

Businesses give great consideration to the cost of energy when making location and expansion decisions, notes the Economic Growth Council. High electricity prices negatively affect job growth and put the state at a competitive disadvantage.

Maine already has the highest renewable energy requirement in the nation and is one of only 24 states that impose this mandate on consumers. In fact, Maine's current 34 percent requirement is two to three times greater than any other New England state. By way of comparison, Massachusetts hopes to reach 22 percent by 2020 and New Hampshire's goal is to achieve 23.8 percent by 2025.

The proposed legislation, L.D. 1570, is simply allowing Maine ratepayer's wallets to take a break while the rest of the region catches up to Maine's high renewable standard.

The Maine Public Utility Commission's analysis showed that the first two years of the increased renewable energy mandate added $7 million to Maine ratepayer's electric bills.

Rather than continue the automatic increases to the renewable energy source mandate, we think there is a better approach by allowing consumer choice while still supporting renewable energy development.

In 2011, Maine electric consumers will have the choice to purchase a "green" power option as part of the MPUC standard offer program. This option will allow consumers to decide to support renewable energy expansion when they make their electricity supply choices. Consumers will potentially be able to select up to 100 percent from renewable energy sources rather than be limited by a 1 percent year to year increase as mandated by the current program.

In addition, each of us has the option of contributing to the existing Maine Renewable Resources Fund, which supports the development of new renewable sources of energy. The LePage administration believes that consumer choice is the preferred means to achieve competitive energy costs rather than imposing mandates on Maine people.

L.D. 1570 also reduces electricity prices by requiring that long-term contracts with energy developers be priced below market, places reasonable limits on renewable cap allowances and requires legislative approval of contracts that affect electricity prices.

Kenneth Fletcher of Winslow is director of the Office of Energy Independence and Security.

Content truncated due to possible copyright. Use source link for full article.


Source:http://www.onlinesentinel.com…

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