Climate change is officially an A-list topic for debate in Olympia—and not a moment too soon. Governor Jay Inslee has declared a state of emergency for drought conditions in both eastern and western regions of Washington, requiring millions of dollars in urgent relief. Climate change is costing us right now.
The climate debate in Olympia this year has centered on two sets of proposals, but only one that addresses the climate problem. The Carbon Pollution Accountability Act (HB 1314), a comprehensive plan to price carbon and invest in our communities, would end free carbon dumping with clear and enforceable limits on emissions. Senate Bill 5735, on the other hand, is designed to offer utilities an exit ramp from the voter-approved clean energy standard, I-937.
The climate bona fides of the Carbon Pollution Accountability Act are unbeatable. The climate case for SB 5735, on the other hand, is much harder to figure out (perhaps because the bill’s proponents understanding of climate science is fuzzy, at best).
I-937: PROGRESS WORTH DEFENDING
Before looking at where SB 5735 goes awry, it is important to understand the clean energy and climate benefits of I-937. I-937 was passed by the voters to diversify and clean up Washington’s electric grid by requiring utilities to generate at least 15% of their electricity from new, non-hydro, renewable sources such as wind and solar. Due to I-937, renewable developers have invested over $8 billion in new projects which have created thousands of jobs, and contribute millions of dollars in tax revenue to rural counties. All of this new clean energy will reduce 8 million tons of carbon pollution per year by 2020, more than any other clean energy law in the state. Since the law was enacted, Washington’s electricity rates have grown only half a cent per kilowatt hour, slower than the national average. Plus, due to effective energy efficiency provisions, I-937 has lowered Washington’s electricity bills. Since 2006, electricity consumption has increased only 2.5%, while the state’s population has grown more than twice as fast. I-937 is good for businesses, ratepayers, and the climate, on both sides of the mountains.
SB 5735 would undermine this progress. The bill would reduce the amount of clean energy investment, divert it from building new renewables and spread it thinly across a wide range of projects. The small investments made under this “kitchen-sink” approach would displace wind and solar, not the fossil fuels that are causing the problem. Replacing proven clean energy with piecemeal projects (some of which may actually increase emissions) would result in limited, if any, carbon benefits. The policy fails the climate test by shrinking the clean energy investment pie, and by slicing it into unsatisfactory slivers.
SHRINKING THE PIE
I-937 already has a “cost cap” provision that limits a utility’s financial commitment to 4% of its revenue. So even if utilities are unable to meet the renewable targets, they are at least investing something in the clean economy. Of course, no utility has needed the cost cap, further evidence that I-937 is working and needs no additional exemptions or compliance loopholes. SB 5735, however, would reduce the total investment by 75% to just 1% of a utility's revenue. Clean energy is already woefully underfunded relative to how fast we need to build new projects, but SB 5735 seeks to pare that down even further. Cutting the clean energy budget is no way to build a low-carbon future.
TOO MANY LITTLE PIECES
So, where would utilities be spending their diminished clean energy dollars? On just about anything that bears a passing resemblance to carbon. SB 5735 creates a new category of “carbon reduction investments,” a catchall term that includes everything from retrofitting ferries to run on natural gas (a project already well underway) to undefined carbon offsets. For a bill that purports to be about carbon reduction, it provides very little opportunity to actually cut pollution. The problem is that instead of reducing fossil fuels, these investments come at the expense of the renewable energy created by I-937.
Not everything in the grab bag is without merit. But if new investments come at the cost of renewable energy, not fossil fuels, they don’t move the ball forward.
Investments in electric vehicle infrastructure and additional energy efficiency deserve both structured programs and long-term commitments. SB 5735 is more likely to produce haphazard projects that vary among utility service territories. Distributed projects are good, but we need focused policies to construct a cohesive energy plan (more Claude Monet, less Jackson Pollock). Good clean energy policy should result in additional projects and new investment, not just provide retroactive handouts for business as usual.
As if it were not enough to curtail clean energy funding and incentivize projects of unknown value, SB 5735 pulls the rug out from the renewable energy industry and leaves responsible utilities in a lurch. Blowing I-937 wide open to all sorts of projects, with little to no oversight, will wipe out demand for new renewable generation. Washington State has more than 100,000 renewable sector jobs at more than 110 companies working to supply solar and wind development. Gutting demand for renewable energy is an attack on this vibrant and growing economic driver. Gifting delinquent utilities easy compliance off-ramps late in the game is unfair to the responsible utilities that followed the will of the voters and increased their renewable portfolios in accordance with the law.
NOT A CLIMATE SOLUTION
SB 5735 uses the language of clean energy investment to weaken the most effective climate and clean energy policy working in Washington. Without increasing the renewable energy target one bit, SB 5735 reduces the total amount of renewable energy investment, while spending that money on unrelated initiatives—some with dubious climate benefit. This is the key issue: This bill would not reduce carbon pollution. At all. It spreads lots of favors out to the Olympia lobbying corps, while failing to advance the public purpose that it claims to serve, even a little. It’s not just a counterproductive climate bill—it’s deceptive public policy.
I-937 has been hugely successful, but that should not make it the sole venue for all clean energy policy. Let’s increase electric vehicle charging and let’s fully fund effective energy efficiency programs and the Clean Energy Fund, but let’s not try to jam these all into I-937 without a commensurate increase in the renewable standard. That would amount to using good clean energy projects to displace other clean energy projects, instead of reducing fossil fuel dependence and lowering carbon emissions. We cannot hope to create a clean energy economy, let alone tackle climate change, by hollowing out our most effective clean energy law and calling it a solution. If you are interested in real progress on climate and clean energy, oppose SB 5735.