by Sue Jones, NRCM energy project director
Thank you for the opportunity to submit comments on behalf of the Natural Resources Council of Maine (Council). I am Sue Jones and I live in Freeport. The Council is a public interest, nonprofit organization that seeks to protect and conserve Maine’s environment for now and future generations. We support the development of renewable power products, services, and markets in Maine and New England.
The Committee has before it today two bills designed to promote renewable energy by amending the State’s renewable portfolio standard. Another bill being heard today, LD 1379, would create a sustainable energy trust fund for wind (only) that would be funded through the current systems benefit charge that is now solely used for efficiency and conservation. These two tools – renewable portfolio standards and clean energy funds – are the primary approaches currently being used across the nation to support renewable energy. As indicated in the attachments to my testimony, 19 states currently have portfolio standards and 12 states have clean energy funds. Nine states (CA, AZ, NM, MN, WI, PA, NJ, MA, and CT) have both a portfolio standard and a clean energy fund.
The Council believes that both of these tools could be used effectively in Maine as part of a strategy to support existing renewable energy and to assist the development of new renewable generation. Of the two approaches, the Council believes that establishment of a clean energy fund (as provided by LD 1379) has the advantage of enabling the State to know how much money is involved, and to focus those funds toward specific objectives and candidate projects. A clean energy fund provides more control over who the beneficiaries will be, based on public policy objectives and demonstration of need.
The clean energy funds that have been established in 12 states are expected to generate $3.5 billion in funding through 2012 to be used to promote renewable energy businesses. Because of this level of activity, Maine can learn lessons from experiences elsewhere. A comprehensive study was produced by the Lawrence Berkeley Laboratory in April 2001 reviewing the experiences of clean energy funds. Attached to my testimony is a short excerpt from that study, indicating the types of renewable resources that are eligible for support in these other states. The highest level of support has gone toward wind power, photovoltaics, geothermal, landfill gas and fuel cells. These are the emerging renewable technologies that tend to need more support in getting to market. More mature technologies, such as biomass and hydropower, also are eligible for support from clean energy funds in many states, although generally restricted to “sustainable biomass” based on advanced technologies and “low-head” or Low Impact Hydropower Institute-certified (LIHI) hydropower not requiring construction of new dams.
Shifting now to renewable portfolio standards, the Council supports amendments to Maine’s RPS. We believe that the existing RPS is ineffective. It has done little to benefit existing renewable power producers, and provides no significant value to prospective developers of new power projects in Maine. We support amending Maine’s RPS so that it functions as a means of promoting renewable energy development. More specifically, the Council supports the direction of LDs 1065 and 1434, yet we have a number of concerns with the existing language.
Eligibility criteria:
The Council does not support including municipal solid waste as an eligible resource.
The Council believes that the eligibility criteria for hydroelectric facilities should be based on environmental standards, and not simply on capacity. The Council believes that qualifying hydroelectric facilities should demonstrate that they are meeting all applicable state and federal water quality standards, all fish passage requirements, and pass adequate minimum flows that are required at the particular facility. This could also be accomplished by adding an amendment making the qualifications of the Low Impact Hydro Institute the applicable criteria for RPS eligibility. Any amendments that propose allowing trapping and trucking fish around a dam is unacceptable except as an interim measure while permanent fish passage is being designed and constructed.
We support clarifying the eligibility of biomass facilities and support criteria to be added that would exclude the combustion of construction and demolition debris, delineate acceptable (cleaner) fuels, and discuss emission control standards. Further, the Council does not support inclusion within Maine’s RPS of biomass facilities that contribute to unsustainable timber practices.
Only fuel cells that use renewable fuels should be eligible within the RPS.
We support removing the 100 mw limitation on the eligibility in the definition of “renewable resource” for sources other than hydro, so as to allow large renewable resource projects to potentially be developed in Maine. In most instances, larger projects have more attractive economies of scale and can therefore generate electricity for cheaper costs per kwh. However, at the same time, many hydro, including those of Hydro-Quebec, have had huge environmental consequences that should not now be supported through market initiatives.
All suitable wind power projects should be eligible for the RPS; they should not be conditioned upon location on tribal lands.
Portfolio requirements:
The RPS should continue in place for an adequate and set period of time in order to ensure developers of new renewable power projects enough time to recover their capital costs. We recommend keeping the RPS in place until 2024.
Compliance:
We do not support the mandatory disbursement of the money in the Maine Renewable Power Fund without a demonstration of criteria that describes how and where it would be distributed. The proposed language in section 6, paragraph 4-C does not consider the unique support that is needed by different types of eligible sources. We support an amendment that would allow the Commission to allocate funds in a fashion that best promotes in-state renewable generation, based on environmental performance, economic development, and/or other relevant criteria.
Where participants cannot satisfy the annual RPS, we support the adoption of a compliance fee that is consistent region-wide with RPSes of states within the Northeast grid so that there is an equal playing field. MA requires a payment of $.05 for every unmet kwh ($50 per mwh).
Thank you for this opportunity to present these comments.
