Saturday, February 21, 2009
Ever since the inauguration I've been on the road driving most mornings 60-plus miles to Virginia's Capitol, leaving the car in a high- rise car park and trudging several blocks to the General Assembly Building.
The state legislature has been in session. It adjourned only yesterday.
I've been a lobbyist during this month -- talking to legislators and appearing before committees to try to convince them to vote for or against measures my organization supports or opposes. I work for an environmental organization and advocate for politices and laws that we deem to be good for the environment. Over the pasts 15 years I've lobbyed for bills to improve clean water, provide open space, and allow citizens the right to appeal pollution permits. More often than working for bills, I'm playing defense -- fighting against legislation that would despoil natural resources, allow landfills near public water supplies, lease park areas to private interests, etc.
This year, I had one assignment: EnergyEfficiency legislation. Of course this is all about using elecriticity in the most cost effective way. But energy is exactly what one needs during the General Assembly as I go to bed late and rise early to plan my day and write talking points before driving to Richmond to meet with allies and opponents, and attend committee and subcommittee meetings. One night we were in committee until midnight.
The Governor has dubbed 2009 the Year of Energy and Environment; in the last year of his term, he's trying to take a meaningful step toward a new energy future. After receiving a lot of criticism from enviromentalists for his support of a new coal fired power plant, he persisted in efforts to look at new energy sources through sponsoring a Commission on Climate Change and in this his last session of the General Assembly, forging ahead with energy efficiency legislation the Commission recommended.
However, the Governor is also now the chair of the Democratic National Committee; he has a Republican House and a bare majority in the Senate. This is not an easy time for him, and bi-partisanship has not become the mantra of the Virginia General Assembly.
Still, the Governor is promoting "Energy efficiency," the legislators claim they're all for it, but the term means different things to different people.
After all the votes were counted, one of the Governor's bills, patroned by Senator Ralph Northam of Norfolk got through the General Assembly and onto his desk, albeit in very different shape from how it was originally drafted by the Governor's staff.
What does energy efficiency mean anyway?
For environmental groups, it denotes promoting programs that permanently reduce demand for more electrical supply by using electricity more efficiently, like, for example, home appliances and machinery that are built to use less electricity, better insulation and weatherization of residences, homes and industries, programmable thermostats that help to turn down the heat when it's not needed even when you're not there to do it, and smart meters -- combined with variable rates -- that help you to become aware of the best times to use electricity when it is cheapest (like washing and drying your clothes in the middle of the night rather than at peak usage times).
The end result should be that by making electricity more efficient, we'll consume less, our bills will go down, and there will be excess capacity that can be used for new growth, thus delaying the need (and expense) to build new power plants. Energy efficiency costs about 3 cents/kWh; power plant generation, 9-10 cents/kWh.
But less demand for electricity is dicey for utilities. Their task is to plan so that a reliable source of electricity is always available. While they agree to reducing electricity through company-based programs, they would like to be compensated for their costs of the programs and for loss of revenues they would have received if everyone was continuing to use more electricity.
Energy efficient legislation has to take these factors and more into consideration. To Wit:
The Governor's bills (one beginning in the Senate with its twin in the House) started out with a goal of 19% as a mandatory reduction by 2025 -- 10 % allocated to utilities, 1% to public buildings, 1% to industry, etc. The idea was that the utilities would have to pay into a compliance fund if they didn't hit yearly targets.
You can imagine how well that went over with Virginia Dominion and Appalachian Power, the big utilities in the Commonwealth.
So a "carrot" approach was tried using "enhanced" rate of return to get the reductions rather than the "stick" of the compliance fund. Even with the loss of the "mandatory" aspect, environmental groups worked well with the utilities on language for the bill - agreeing to definitions of various terms and the framework of how energy efficiency programs would be developed.
Still . . . we hit snags.
The manufacturers wanted to be carved out of the bill arguing that they already used energy efficiency to cut costs and therefore should not have to pay for programs serving other consumers (Of course, they will still benefit from the lower costs due to delay of building power plants). So a carve-out was designed and re-designed several times.
The utilities wanted a guarantee that nothing in the bill would prevent them from getting new power plants so they wanted language that in essence would have directed the the State Corporation Commission (SCC) not to consider the impact of reducing demand when they asked the SCC to give them permission to build power plants. With a lot of wordsmithing, the Governor's staff was able to placate environmentalists and utilities.
At the time the Governor's bill in the House of Delegates went to the full House Committee on Commerce and Labor, a number of Republican delegates expressed concerns about the enhanced rates and the costs to ratepayers -- even though studies show that ratepayers would see their rates drop by 2015 an average of $5-20 a month.
Nevertheless, the Governor's bill (sponsored by Del. Plum of Herndon) never got out of the House committee -- It was "rolled into" (i.e. subsumed by) a more innocuous version of rate recovery for energy efficiency program costs (Del. Pollard's bill) Because of the motion to "roll" one bill into another, there was no vote on killing the Governor's bill, but the proof was in the pudding.
Meanwhile the House (and Senate) passed other bills that required a study of the cost effectiveness of "energy conservation" and other measures by next fall.
But the Senate also passed another version of the Governor's bill. By the time it passed the Senate, the mandatory goals had become voluntary; by the time it left the House of Delegates, even the voluntary goals had been stripped away.
Success, however, is getting the bill in relatively unscathed form (no fatal amendments) to the Governor's desk, and that was achieved.
This is probably more than you wanted to know about energy efficiency or lawmaking -- but this , I emphasize, is only a synopsis. There are many more "back stories."
Pollard's bill subsequently became the subject of an effort on on the Senate Floor to require an amendment that would list the cost of energy efficiency programs on consumer bills. Now consumer disclosure is a good thing, but oddly, as Senator Chap Peterson pointed out, the same legislators had not asked for consumer disclosure two years ago when they mandated the building of a coal fired power plant in South West Virginia.
Fortunately, the amendment was defeated, largely along party line vote.
Peterson by the way had sponsored legislation that was far more ambitious than the Governor's in attempting to set a reduction in electricity usage; his bill went down in flames. Senator Don McEachin of Richmond championed a bill with mandatory goals and the compliance fund; his was killed by the committee on an 8-7 vote. Other legislators who championed some aspects of energy efficiency legislation included David Toscano and David Nutter.
The Governor will have two bills on his desk that go to the heart of energy efficiency programs -- Pollard's HB 2506 and Northam's SB 1248. Other bills (that we opposed) that were substantially amended, SB 1348/HB 2531, will also be before the Governor to sign, veto or amend.
The debate over energy efficiency will continue in Virginia. Because it's in your self interest to save money at your home and business, you need to be involved. We also need citizens to help shape future Commonwealth policy on the topic. Sphere: Related Content
Posted by Katherine "Kay" Slaughter at Saturday, February 21, 2009