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Renewable Energy Requirements Get a Second Wind

Conservatives were out in force last year trying to roll back requirements for some states to use alternative energy. They failed. Does that mean attitudes on green power are changing?

David Kidd/Governing
Last year could have been a rough one for wind power. As a renewable source of energy, it was under attack in 20 states—as were other alternative sources of energy. Leading the charge was a corps of well-financed conservative groups, and one front in their well-financed attack was Republican-led states. The target of their offensive? Mandates that have been passed over the last 15 years calling for alternative energy sources to be an ever-increasing part of the energy base in a state.

Given the way red states and the conservative groups lined up, it certainly looked like rollbacks in state renewable energy requirements—if not outright repeals—were inevitable. And yet, energy and politics have a strange way of playing out. Kansas in particular, one of the reddest of the red states and one with a big investment in wind energy, proved to be a test case in the power of conservatives to push through an anti-renewables agenda.

The mandates in question are state renewable portfolio standards (RPS), which call for a certain percentage of a state’s electricity to be generated through renewables, such as biomass, solar, thermal, hydro or wind. The first RPS law passed in Iowa way back in 1991. Since then, 29 states and the District of Columbia plus two territories have adopted RPS, while eight other states and two territories have set renewable energy goals.

Last year, however, there was an all-out attack on these portfolios in 20 of those 29 states. The effort was led by such conservative stalwarts as the Heartland Institute, Americans for Prosperity and the American Legislative Exchange Council (ALEC), which helped supply model legislation aimed at derailing the renewable boost. Bills in the 20 states were introduced to either modify, stall or kill RPS outright.

The reason for the 2013 flurry of attacks on RPS is that a host of state laws will be going into effect in the next few years, says Susan Williams Sloan, vice president of state policy for the American Wind Energy Association. The anti-RPS forces claim that these laws represent a multimillion dollar tax on utilities. That translates, they say, into a job-killing multimillion dollar tab for consumers who would be forced to pay higher rates for the higher-cost renewables when compared to such carbon-based fuels as coal and natural gas.

But the economics of renewable energy are complicated. Its cost varies depending on a wide array of factors and formulas, ranging from weather, topography and hydrology to whether the consequences of extracting and burning hydrocarbons ought to be considered when calculating the actual cost of coal, gas and oil. “There are so many factors that can affect electricity rates, from resources to demand,” says Glen Andersen, energy program director with the National Conference of State Legislatures (NCSL). “It can be difficult to figure out why rates are actually going up.”

The politics of renewables is proving to be equally complex—something that may have come as a surprise to those working to stall, roll back or kill RPS. In the 20 states where anti-RPS legislation was introduced last year, all the bills came up short. This sweeping rebuff, RPS supporters argue, is proof that the standards are a legitimate vehicle for encouraging the drive toward U.S. energy independence. They also argue that standards encourage cleaner energy generation, which has direct bearing on climate change.

That the argument would get caught up in the climate change debate was inevitable. And many say that is likely the reason why the fight has taken on an ideological tinge. But the phenomenon of renewables—wind power, in particular—is also highlighting a clear rift in conservative ranks. It is pitting the ideologically pure against the politically practical in a way that appears to be blowing wind’s way.

The plain and politically topsy-turvy reality is that the fastest growth in wind power is taking place in some of the most conservative states—Nebraska, Oklahoma, Texas and, of course, Kansas. The battle in Kansas has its roots in a 2009 coal versus renewables compromise.

That compromise was brokered by interim Gov. Mark Parkinson, who took the reins when then-Gov. Kathleen Sebelius agreed to join the Obama administration as secretary of the Department of Health and Human Services. The debate was over the permitting of a new coal-fired power plant, which drew the opposition of environmental advocates and also advocates of renewables.

The deal that Parkinson hammered out was a permit for the coal plant in return for a renewable portfolio standard. Under the deal, the legislature passed a law mandating that by 2015, 15 percent of Kansas energy would come from renewables, with that percentage rising to 20 percent by 2020.

The ensuing debate over the standards in Kansas hasn’t revolved around whether or not such percentages are reasonable: Most utilities have blown through the 15 percent and all but one Kansas utility has already rolled through the 20 percent goal. The debate is over cost and whether politicians ought to be meddling in markets. Also helping wage the wind wars are David and Charles Koch, the ultra-conservative billionaire brothers with extensive oil and gas holdings. The brothers, who live in Kansas, have in recent years begun to shift their political sights and agenda toward states.

The RPS battle in Kansas started percolating in 2012 and then got fierce in 2013, when the chair of the House Energy and Environment Committee, Dennis Hedke, a member of ALEC and a geologist with fossil fuel clients, championed a bill to cap the Kansas RPS at 15 percent (the Senate bill would have delayed implementation).

But what happened to that legislation is instructive, and raises obvious questions about how red-state Republicans proceed on the question of renewables. In the end, the anti-RPS forces lost by 23 to 17 in the Senate. The House voted 63 to 59 to send the bill back to committee—this in a legislature where Republicans have an overwhelming supermajority in both chambers: 92 to 33 in the House and 32 to 8 in the Senate. In other words, plenty of Republican legislators bucked leadership in support of RPS.

John Eick, who handles energy, environment and agriculture policy for ALEC, speculates that the loss in Kansas was due to powerful alternative energy interests. “In Kansas [and other states] the wind and solar industries are pretty entrenched, so when the proposal came up, a lot of legislators felt heat from those industries.”

Pro-RPS representatives have a much different read on the reasons for the bill’s failure. For one thing, Kansas utilities sat out the fight. That, in no small part, might have to do with statistics validated this year by the Kansas Corporation Commission, the utility regulatory body in the state. The findings show the impact of RPS on the cost of electricity to be negligible; less than one-sixteenth of a penny per kilowatt hour (the average household uses about 14,000 kilowatts per year). But utilities’ seeming neutrality on changing RPS laws also might have something to do with the fact that utilities tend to plan 20 to 40 years out and therefore crave policy stability—whatever that policy might be, says NCSL’s Andersen. Since the early and mid-1990s, those plans have begun to include incorporating RPS.

It wasn’t only the clout of renewables that derailed the two bills, says Dorothy Barnett, executive director of the pro-renewables Climate + Energy Project, based in Hutchison, Kan. Rather, it was a broad coalition of supporters, ranging from Fortune 500 companies to individual landowners.

Heavy hitters like Mars candy, Siemens, Google and Facebook came out in favor of renewables for reasons ranging from corporate concerns about climate change to the public relations value of boasting a clean energy base. Also in the RPS corner were numerous local chambers of commerce. “You hear repeatedly from economic development officials that [renewables] are another tool in their business recruitment tool box,” Barnett says. There can also be serious tax and revenue benefits from hosting a wind farm, she argues, noting that in Elk County, which has a $2.5 million annual budget, the 20-year payoff for hosting a wind farm is $1 million a year. It didn’t hurt either that Kansas Gov. Sam Brownback is a strong backer of Kansas wind farms.

Faced with heavy pressure from corporations, chambers of commerce, local government officials and individual landowners—including farmers for whom wind energy has proven to be a boon—legislators in Kansas turned down the chance to cap renewable energy standards. At the same time, a recent poll commissioned by the Climate + Energy Project indicates overwhelming support for wind power in Kansas. The poll, conducted by North Star Opinion Research, indicates that among Kansas voters, 73 percent of Republicans, 75 percent of Independents and 82 percent of Democrats support the 2009 energy law. Two-thirds of those polled said they would support increasing the state’s renewable energy threshold, even if it meant a $1 to $2 increase in their monthly bill.

Of course, parties from both sides of the debate have numbers to throw around. A joint study by the conservative think tanks the Beacon Hill Institute and the John Locke Foundation estimates that RPS will cost North Carolina electricity consumers $1.845 billion between 2008 and 2021. The report also challenged what it characterized as bloated job creation claims by pro-RPS forces. Such arguments—and eye-popping numbers—however, weren’t enough to win over key House and Senate Republicans last session. They joined with Democrats to kill a bill sponsored by ALEC member and former Duke Energy employee, Rep. Mike Hager.

Hager blames the foundering of his Electricity Freedom Act on powerful political interests including poultry and pork farms, which are specifically designated as renewable energy producers in the North Carolina RPS law. “[They] don’t want to end the gravy train,” Hager was quoted as saying after the bill was bottled up in the House.

The rebuke in North Carolina—along with the sweep in the 19 other states by pro-RPS forces last year—seems to have taken the wind out of the sails of those seeking to stall, roll back or repeal renewable portfolio standards. This year only a handful of states are seeing continued action on RPS, but one of those is Kansas. There, anti-RPS forces are going the grassroots route, blanketing the airwaves with ads pounding RPS as anti-consumer and anti-economic development.

Meanwhile, notes the Climate + Energy Project’s Barnett, neighboring state legislatures, including those in both Nebraska and Oklahoma, are trying to figure out how to boost wind energy, including offering tax breaks for in-state wind farms. So while Kansas has been debating renewables, Barnett says, “other states [have been] taking advantage of our mistakes.”

A Senior Editor of Governing, Jonathan has been covering state and local public policy and administration for more than 30 years.
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