Senate

Maybe. From my seat as a journalism and environmental science student at the University of Idaho, things are not looking too great for wind power. While the wind energy industry has seemingly flourished here in parts of the Pacific Northwest (as seen in Beyond the Light Switch’s wind segment), with wind turbines populating once vacant stretches of land, a recent article in The Denver Post revealed that developments like this might come to a crashing halt.

The increased production and assembly of wind turbines in the U.S. over the past 10 years are partially the result of production tax incentives (PTC), a program whose future may be in jeopardy.

Created under the Environmental Policy Act of 1992, PTC has promoted growth in renewable energy industries and supplied many Americans with jobs in sustainability-related areas. PTCs currently offer a 2.1 cents/ kilowatt-hour tax credit to qualified wind industries and other renewable energies like biomass, hydroelectric, and geothermal – with the U.S. currently sporting a total of 38 states with utility-scale wind turbines. The PTC program is currently up for renewal, but deliberations in Congress may tie it up for good. The Denver Post reported that the $1.4 billion program (extended over 10 years) has already failed three times in the Senate.

Here Allison Sherry of The Denver Post quotes U.S. Senator Michael Bennet of Colorado, "It's nuts…it's like Congress will get around to it when Congress is ready to work on it, but that's cold comfort for people getting laid off across the country and the state of Colorado." Sherry adds that cutting this program now would be way more damaging than it would have been 10 years ago because of the industry’s recent and rapid growth. But opponents of the program’s renewal are less sympathetic...

 A February article from The Wall Street Journal offered an example of such wind-opposing sentiment here, “The wind industry simply cannot continue to rely on the American taxpayer," said Rep. Mike Pompeo (R., Kan.), who is currently pushing a bill that would cut many energy-related credits from the tax code. "Each time it comes up to a year of expiration, they say, 'If we just get a few more years our technology will mature and we will become more competitive.' It's time for them to figure out how to do that."

Director of Stanford University Atmosphere and Energy Program Mark Z. Jacobsen’s response to this issue is related more to the health benefits of switching to renewable energy sources versus fossil fuels. A Beyond the Light Switch video interview posed the following question to Jacobson: “If energy from renewables is going to be more expensive, why should we consider our energy mix at all?” Jacobson answered, “This is a really twisted incentive system where we pay people to cause environmental damage, and so as a result they can freeload off the health of our citizens. And at the same time we complain about giving subsidies to renewable energy industries that are effectively eliminating those air pollution health problems and deaths.”

California's largest electric utility is desperate to slow down a new program that's going to revolutionize the way small businesses pay for their power. The company claims customers need more time to understand 'dynamic' pricing, but higher "time-of-use" rates will mean a new way of doing business for many of California's small business owners.

Consumer advocate groups and The California Small Business Association have come out against the new pricing for electricity, but state regulators have already approved the program. According to the San Francisco Chronicle "PG&E in November will start charging its roughly 500,000 small-business customers different rates for electricity at different times of day. Businesses will also face significantly higher rates on a handful of days each year when power supplies are strained, either by hot weather or problems with the electricity grid."

It should be noted that business owners will be able to "opt out" of the program —for the time being, anyway. According to The Chronicle, "the California Small Business Association has now asked the California Public Utilities Commission, which approved PG&E's program, to slow down the timetable for the changes. And PG&E, to an extent, agrees, arguing that the utility needs more time to educate its customers."

What utilities like PG&E want to "educate" all of us about is the transition to "time-of-use" rates. So what does all of this actually mean? Wikipedia breaks down the different categories of time-based pricing in relation to electricity industry like this:

• time-of-use pricing (TOU pricing)—whereby electricity prices are set for a specific time period on an advance or forward basis, typically not changing more often than twice a year. Prices paid for energy consumed during these periods are pre-established and known to consumers in advance, allowing them to vary their usage in response to such prices and manage their energy costs by shifting usage to a lower cost period or reducing their consumption overall;
• critical peak pricing—whereby time-of-use prices are in effect except for certain peak days, when prices may reflect the costs of generating and/or purchasing electricity at the wholesale level
• real-time pricing (also: dynamic pricing)—whereby electricity prices may change as often as hourly (exceptionally more often). Price signal is provided to the user on an advanced or forward basis, reflecting the utility’s cost of generating and/or purchasing electricity at the wholesale level; and
• peak load reduction credits—for consumers with large loads who enter into pre-established peak load reduction agreements that reduce a utility’s planned capacity obligations.

The Wiki-editors go on to recommend dynamic pricing, saying that "time-based pricing will reflect the price variations on the market. Such variations include both regular oscillations due to the demand pattern of users, supply issues (such as availability of intermittent natural resources: water flow, wind), and occasional exceptional price peaks." The general idea is that dynamic pricing begets consumer response—once people are paying more for electricity depending on when they use it, they tend to pay more attention to their usage. While it may be true that Americans have long enjoyed cheap electric rates in comparison to other countries, but the days of power that's "too cheap to meter" are decidedly coming to an end...

Subsidies for renewable energy may be going away...again.

America's stormy love affair with renewable energy began in the 1970's, when President Jimmy Carter introduced subsidies for what were then termed 'alternative' energy resources. But the burgeoning wind and solar industries that grew under Carter were not fated to last long. Nurturing an infant renewable energy industry was not part of Ronald Reagan's presidential image, nor his platform. Beyond the Light Switch looks at this pivotal time in our nation's history as a means to understand the current state of our energy policy and energy politics.

Currently, the hopes of many long-suffering renewable energy supporters (and industry players) have been pinned on the Obama administration. And Obama did make good--by ushering in subsidies for renewables, known as the "1603 grants" (so-called for the section of the stimulus bill that created them). And just in case you were wondering what those grants actually do, today The LA Times was kind enough to lay it out for us--the 1603 grants "paid up to 30% of the cost of projects breaking ground by the end of this year. Renewable facilities generating a combined 4,250 megawatts (the equivalent of roughly four large nuclear plants) were supported by the program as of March, according to a report by Lawrence Berkeley National Laboratory; that output is doubtless far higher now. The grants have created thousands of jobs, and helped clean the air and wean the country off fossil fuels. But all that may be about to stop".

Sounds scary, doesn't it? Well, what's happening is...