In what may be a first, the North Carolina Utilities Commission (NCUC) has put on its docket a petition to declare that a renewable power facility is in fact a public utility under NC law. This action is the result of a filing I did on May 18 asking the NCUC to issue a “… declaratory ruling that Fresh Air Energy, LLC is a public utility pursuant to G.S 62-3(23) for the purposes of the public utilities act.”
While much of what the NCUC does is legalistic, and seems complicated to the non-lawyer, this request is straightforward. I just want the NCUC to require the renewable companies to tell the public how much it costs them to produce the electricity they are selling us — just like Duke Power and the other power companies are forced to do.
Since I buy my electricity from Duke, a regulated utility, and Duke (and other power companies) are forced to buy electricity from these renewable companies, due to the 2007 Senate Bill 3, they should be treated in the same manner we treat all power companies. Duke is required to disclose how much it costs to generate and transport the electricity and the NCUC sets a price that allows Duke to make a profit.
With the renewables, Duke adds a charge to our electric bills to help cover the costs of buying this “renewable energy” at a higher price than it costs to generate the electricity itself. This extra charge goes towards covering the higher costs of this electricity and the higher costs of upgrading the grid to handle these distributed generators.
To protect families and keep North Carolina competitive, we need to keep the cost of electricity as low as possible. The current system does not encourage competition among renewables. We also need to encourage the idea that we need transparency from our utilities.
I believe in the future, when more robust and safe storage (i.e. batteries) solutions are developed, renewables will have a more important place in our energy mix. Right now, however, the primary driver of renewables in NC has been state and local tax subsidies. Even the industry’s own studies admit this, as in Lazard’s Levelized Cost of Energy Analysis 10.0, which states that producers have been focused on maximizing subsidies rather than driving down costs. Since taxpayers have already subsidized the production of this electricity, why don’t they pay for it solely based on the actual costs?
If our efforts are successful in opening the books on renewable power, we will finally know the true costs of renewable electricity in North Carolina.
Francis:
THANK YOU for doing this! Yes, renewable energy businesses should be required to provide full disclosure of their costs.
Two points:
1) The two main renewable drivers here are: the state’s RPS (SB3), and the federal government’s Production Tax Credit (PTC).
2) Even after we get the cost you are asking for, we will still not have the FULL cost of these renewables. For example, it will not take into account the necessary cost to maintain and operate an auxiliary source (typically gas). For example, it will not likely take into account the cost of extra transmission lines needed. Etc.
That said, what you are doing is an important step in getting a better handle on the true costs of renewable energy.
A bit of selective deleting of comments….
George,
What are you talking about? No comments have been deleted. We do edit out comments that are profane but haven’t seen any of those.
Francis