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Sunday, March 15, 2015

Serious approach to cutting energy costs

Senator Sosnowski submits legislation to address high cost of energy in Rhode Island

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STATE HOUSE – Focusing on the high cost of energy in Rhode Island, Sen. V. Susan Sosnowski (D-Dist. 37, South Kingstown, New Shoreham) has submitted a package of legislation to promote renewable energy, energy efficiency, and ensure that National Grid’s profits are set in a transparent process.

The first bill (2015 S-0089) would extend Rhode Island’s Renewable Energy Standard (RES), which is set to expire in 2019, to 2035. Enacted in 2004, the RES requires National Grid to gradually increase the amount of renewable energy in the power it supplies its customers. The goal for 2019 is that 14.5 percent of electricity supplied to ratepayers will come from renewable sources.

“Extending the RES will continue to support the state’s rapidly growing renewable energy industries that provide substantial economic benefits,” said Senator Sosnowski, chairwoman of the Senate Environment and Agriculture Committee. “These benefits include in-state investments and local jobs, while helping to reduce the state’s reliance on natural gas to generate electricity.”

The second bill (2015 S-0409) would authorize the Public Utilities Commission to conduct a more comprehensive review when determining a utility’s profit by allowing the agency to consider the existence of other remuneration.

“As it stands now, the PUC can’t consider the profit that National Grid makes from other sources, such as administering efficiency and renewable energy programs, when determining the utility’s overall profit,” said Senator Sosnowski.

In 2014, these profits totaled almost $6 million as follows:  National Grid received about $1.1 million in profit for administering gas efficiency programs; about $4 million in profit for administering electricity efficiency programs; and $876,602 in profit for long-term contracting and distributed generation.

“The bill also levels the regulatory playing field so that Rhode Island is similar to Massachusetts and Connecticut by allowing the PUC to consider all circumstances that may reduce a utility’s risk,” said Senator Sosnowski. “Risk is a factor the PUC considers when determining a utility’s profit. A lower risk translates into a lower profit.”

Finally, the bill caps National Grid’s profits for administering the Renewable Energy Growth Program to 1.75 percent and for administering the energy efficiency program to 2 percent of the Energy Efficiency Fund, which would be less than half of its current profits under the efficiency programs.

The third bill (2015 S-0410) would require the Office of Energy Resources to assemble a task force to promote the development of markets for alternative renewable home heating and transportation fuel, such as clean burning biodiesel fuels. It would also assemble a task force to develop an energy efficiency program for home heating oil and propane. The reports of these task forces would be due Jan. 31, 2016.

The alternative renewable fuel task force would have up to $50,000 from the Renewable Energy Fund to hire consultants.

“This is good for the environment,” said Senator Sosnowski. “Clean burning biofuels reduce greenhouse gas emissions. It will also increase our energy security, because biofuels are a domestically produced sustainable fuel source. And it’s good for the economy because producing biofuels creates jobs.”

The energy efficiency task force would be provided with up to $75,000 from the energy efficiency fund to hire consultants.

“Efficiency programs in Rhode Island have a proven track record for reducing energy costs,” said Senator Sosnowski. “Rhode Island leads the nation in electricity efficiency, yet we don’t have an efficiency program for home heating fuels, despite the fact that about 42 percent of Rhode Island homes heat with oil.”

The national ranking for Energy Efficiency Policies by the American Council for an Energy-Efficient Economy placed Rhode Island third in the nation for energy efficiency. Since 2008, $558 million invested in electric efficiency has resulted in $1.99 billion in consumer benefits, 25,000 job-years of employment created, and $2.35 billion added to the Rhode Island gross state product.

All three bills have been referred to the Senate Committee on Environment and Agriculture.