What’s wrong with “least cost” for CO ratepayers?

February 9, 2011 by Amy
Filed under: Archive, New Energy Economy 

In State Senator Scott Renfroe’s closing remarks to the State, Veterans and Military Affairs committee, he reasonably questioned members while asking for support of their support for SB11-058: “What’s wrong with striving to have our energy sources be the least cost?”

Apparently everything.

The committee defeated Renfroe’s “Electric Utilities Employ Least-Cost Planning for New Resource Acquisition” along party lines with Democrat Senators Rollie Heath, Bob Bacon and Betty Boyd voting against the pro-ratepayer bill. Senators Bill Cadman and Kevin Grantham voted in favor of ratepayers.

What would SB 58 have done for Colorado’s energy users:

  • Require the PUC to consider “cost” when deciding on new energy facilities and resource acquisition.
  • Put cost to ratepayers before the PUC commissioners’ environmental values.
  • Prohibit “costs that are not identified as those that will be actually incurred by the electric utility may no be included in the revenue requirement analyses.”
  • Prohibit the $20 per ton phantom carbon tax.

Former Public Utilities Commissioners Polly Page and Carl Miller testified that over the last several years the PUC has changed its mission from the least cost principle that leads to affordable, abundant and reliable energy” to one that favors renewable energy sources regardless of cost to ratepayers. Predictably, renewable energy representatives were on hand to protect their heavily-subsidized industry.

The Independence Institute’s Amy Oliver Cooke encouraged the committee to be “forward thinking” and support the bill because it repeals language that assumes the risk of a national $20/ton carbon tax that Congress probably won’t pass any time soon. Even if it did, it would take five years to implement. Also, the carbon tax that was discussed at the federal level prior to last November’s congressional power shift was not anywhere near $20/ton. At the high end, it was $12/ton.  So Colorado ratepayers endure the cost for an obscenely high, non-existent carbon tax. Renfroe’s bill would have corrected this injustice.

Renfroe also reported that Xcel Energy electricity customers have seen their rates rise a whopping 21 percent over the last few years and are expected to continue to do so.  Furthermore, Colorado has higher rates than all neighboring states except New Mexico. And coincidentally, Xcel is enjoying huge profits.

But in the end it did not matter because Senator Bacon (D-Fort Collins) is worried about being a good steward of environment and keeping it clean for future generations. For that reason, he voted “no,” which was in kind of funny because his comments on the previous bill about transparency and new technology indicated he was more concerned with older Coloradans who want to hold a newspaper rather than use a computer.  Also, doesn’t hard copy kill trees so crucial to the environment he claims to protect? Confused? So were some others in the room.

Senator Bacon also frightened everyone with stories of his trip to China and the “pall” that was cast over country from dirty fossil fuels. Perhaps the Senator doesn’t know that those fossil fuel utility plants generate the electricity needed to manufacture the solar panels that U.S. businesses buy from Chinese companies. China controls much of the world’s solar panel production because they are rich in the rare earth minerals needed for manufacturing.

Senator Heath (D-Boulder) voted no because the “least cost planning rule” is regressive. So providing low cost energy to Colorado ratepayers takes the state backwards? Confused? So were some others in the room.

Heath also cited troubling events in Egypt and the reliance on “foreign oil” as another reason to vote “no.” Apparently Senator Heath doesn’t know that Canada is the number one supplier of oil to the U.S.

Bottom line: Ratepayers lose while Xcel and subsidized renewable energies win and continue to enjoy their favorable treatment from the Colorado legislature.

Print Friendly

Comments

3 Comments on What’s wrong with “least cost” for CO ratepayers?

  1. Cooler Heads Digest 11 February 2011 on Tue, 29th Mar 2011 7:19 am
  2. [...] Democrats on the Colorado State Senate State, Veterans, and Military Affairs Committee this week voted down legislation that would have required state regulators to return to least-cost electricity planning. [...]

    [...] Most interesting are the 14 bills Xcel opposes, including pro-consumer legislation such as transparency on ratepayers’ energy bills and reducing energy costs through utilization of a “least cost principle.” [...]

    [...] Rollie Heath (D-Boulder), who as Chairman of Senate State, Veterans and Military Affairs has killed other Xcel-opposed legislation, asked that the hearing for HB 1291 originally scheduled for Monday, April 25 at 1:30 p.m. be moved [...]