The year 2015 may go down as when support for renewable energy flipped. Policy adjustments—whether for electricity generation or transportation fuels—are in the works on both the state and federal levels.
While the public remains generally positive about the idea of renewable energy, the reality of years-long policy implementation that offers it special favors has changed public opinions. An October 2014 report in Oklahoma’s Enid News titled: “Wind Worries?: A Decade after Welcoming Wind Farms, States Reconsider,” offers this insightful summary:
A decade ago, states offered wind-energy developers an open-armed embrace, envisioning a bright future for an industry that would offer cheap electricity, new jobs and steady income for large landowners, especially in rural areas with few other economic prospects. To ensure the opportunity didn’t slip away, lawmakers promised little or no regulation and generous tax breaks. But now that wind turbines stand tall across many parts of the nation’s windy heartland, some leaders in Oklahoma and other states fear their efforts succeeded too well, attracting an industry that gobbles up huge subsidies, draws frequent complaints and uses its powerful lobby to resist any reforms.
But, it isn’t just wind energy that has fallen from favor. State and federal legislation reflects the “reconsider” prediction. Likewise, “powerful” lobbyists resist the proposed reforms.
About a decade ago, when more than half of the states enacted strict Renewable Portfolio Standards (RPS), Oklahoma, and a few other states, agreed to voluntary targets. Now, nearly one-third of those states are reconsidering the legislation that sounded so good in a different energy era. Back then people widely believed that in an energy shortage and the idea of “dealing with global warming” struck the public as a higher public priority.
“Roughly 30 bills relating to the Oklahoma wind industry have been filed in the state legislature in the 2015 session, including at least one targeting the tax breaks and others attempting to alter regulatory policies,” reports Fox News. On April 16, the Oklahoma House voted, 78-3, to eliminate the wind energy tax credit. The measure now moves to the Senate.
Oklahoma isn’t the first state to reconsider its renewable energy policies. That distinction goes to Ohio, which, in May 2014, passed legislation that paused the state’s RPS for two years. Governor John Kasich signed it in June. Meanwhile, according to Eli Miller, the Ohio State Director for Americans for Prosperity: “the economic well-being of our working families and businesses can be factored in before moving forward.” The International Business Times projects that the two years a commission has to study will lead to a “permanent reduction.”
Earlier this year, West Virginia became the first state to repeal its RPS. With unanimous support in the Senate and a 95-4 vote in the House, renewable energy supporters are dismayed. Calling it “pure political theater and probably a flop,” Nick Lawton, Staff Attorney at the Green Energy Institute dismisses the move: “West Virginia’s withdrawal of its weak renewable energy policy is unlikely to significantly change that state’s energy markets.” Nancy Guthrie, one of the four Democrats who voted “No,” did so because she believes “we are running out of coal, it’s that simple”—which is, of course, totally incorrect.
Last month, the Texas Senate voted to end its RPS and another program that, according to the Star Telegram, “helped fuel the state’s years-long surge in wind energy production.” While Texas is known for its leadership in wind energy, the termination of the RPS would impact the solar industry as well. Charlie Hemmeline, executive director of the Texas Solar Power Association, states: “Increasing uncertainty for our industry raises the cost of doing business in the state.”
Coming up, Kansas, North Carolina, and Michigan have legislation that revisits the states’ favorable renewable energy policies. New Mexico and Colorado had bills to repeal or revise the RPS that passed in one chamber, but not in the other.
While Louisiana doesn’t have an RPS, it does have generous tax credits for solar panel installations that have exploded the cost to the state’s taxpayers. The credits were originally expected to cost the state $500,000 a year. In 2014 the payouts ballooned to $63.5 according to the Baton Rouge Advocate. Repealing or revising the policy is a key priority in the current legislative session.
“Taxpayer support for wind energy is also losing momentum in Congress,” says Fox News. It points out: “Capitol Hill lawmakers at the end of last year did not extend the Federal Production Tax Credit (PTC). And in March, Sen. Heidi Heitkamp (D-ND), failed to rally support behind an amendment that would have put a five-year extension on the PTC.”
It is not just wind energy that has lost favor on Capitol Hill. Congress re-examines the ethanol mandates—known as the Renewable Fuel Standard (RFS)—too.
On January 16, 2015, Senators Dianne Feinstein (D-CA) and Pat Toomey (R-PA) introduced the “Corn Ethanol Mandate Elimination Act of 2015.”
Hawaii, uniquely, has its own ethanol mandate, but it, too, faces scrutiny. KHON states: “Nine years after a major change at the gas pump was forced on Hawaii drivers, many are now calling it a failed experiment and want it gone.”
In both the case of Hawaii and the federal government, lawmakers look toward advanced biofuels that don’t raise food costs. However, the Environmental Protection Agency—tasked with implementing the RFS—has repeatedly waived or reduced the cellulosic biofuel requirements because, despite more than $126 billion invested since 2003, the industry has yet to produce commercially viable quantities of fuel.
Addressing dwindling investment in biofuels and growing skepticism, The Economist, on April 18, says: “Campaigners generally find it easier to fulminate against those which damage the environment or food security than to explain exactly how they ought to be grown.” It concludes: “Whether such bright ideas can be commercialised at scale is a different question. Some companies, indeed, are starting to give up. Several algae-to-fuel ventures in America are switching to the manufacture of high-value chemicals instead. Sunlight is a great source of energy. Biology may not be the best way of storing it.”
And this doesn’t include the public’s failure to embrace higher-priced electric cars—even with tens of thousands of dollars of subsidies and tax credits.
Looking at all the policy reviews, the trend is clear. As Watchdog.org concludes in a report: “The best policy for the states is to leave energy consumption decisions to consumers in the market rather than legislate them.”
The author of Energy Freedom, Marita Noon serves as the executive director for Energy Makes America Great Inc. and the companion educational organization, the Citizens’ Alliance for Responsible Energy (CARE). She hosts a weekly radio program: America’s Voice for Energy—which expands on the content of her weekly column.