Hardwick Hates Renewable Energy??

No town in northern New England has managed to associate itself with enlightened public policy recent than Hardwick, Vermont. See the web site of the Hardwick- based Center for an Agricultural Economy for news of the successful efforts there to build local food systems that operate as a viable alternative to race-to-the-bottom globalization and factory food production. (We may, by the way, have such production to thank for the emerging swine flu epidemic, since the virus seems to have emerged from a facility in Mexico that houses a million pigs for slaughter.)

So, it's a bit surprising to read this apparently antedulivian letter from the chair of Hardwick's municipal electric utility (which also serves all or part of Greensboro, Craftsbury, Woodbury, Wolcott, East Calais, Elmore, Hyde Park, Eden, Stannard and Walden) in today's Barre-Montpelier Times Argus:

In order to meet their promised closure date of May 8, the Vermont House of Representatives has rushed their vote in favor of bill H.446. As a consequence, the bill, while commendable, is flawed. The bill proposes to require that all Vermont utilities, including Hardwick Electric, will have to pay SPEED qualified renewable energy generation facilities "above rate" prices for the electricity they produce.

Specifically, Hardwick Electric will be required to pay its share of a statewide allocation for power produced by methane, residential wind power, and solar powered systems higher than normal prices for the electricity they produced. Per kilowatt hour, we will have to pay $0.12 for methane systems, $0.20 for wind power systems and $0.30 for solar powered systems. Currently, Hardwick Electric can buy electricity on the open market for around $0.06 or $0.07 per kilo-watt hour.

This bill is flawed. Why? Only the more wealthy Vermont residents will be able to afford to invest in these residential renewable energy systems.

Along with all of the other municipal utilities, Hardwick Electric is a non-profit entity. To get the extra money that will be required to pay the above market rates, we will eventually have to raise the residential electricity rates. Those local residents or businesses who have built their own renewable energy systems will be essentially unaffected by these raised rates, since the rates at which they will be paid is fixed by law and they will be providing their own electricity needs. Those ratepayers who cannot afford to build such systems will have to bear the higher electrical rates.

What does this mean? Effectively we will be transferring the cost of maintaining Vermont's, including Hardwick Electric's system to the "poorer" rate payers. Those local residents with a wind turbine or solar panels will be letting their next-door neighbors pay an extra or nickel, dime or so for each kilowatt hour of electricity their renewable energy system produces.

While I like the idea of encouraging those who can afford it to invest in the renewable energy, we should not do this by penalizing only those who cannot afford to invest. Bill H.446 needs to be rewritten with a fairer funding source for the required above rate prices. I believe the Legislature is moving too fast and as a consequence is making mistakes. They can do better.

Joe Wood

Hardwick Electric Commissioner

Woodbury

This is a troubling letter, both for what it says and what it does not say.

Mr. Wood's complaint boils down to a lament that is familiar whenever there is discussion of a proposal that would encourage the development of renewable power. The only way to encourage activities (as opposed to mandating them) is to subsidize them economically -- that's just as true for private-sector development of renewable energy capacity as it is for home ownership. And when we subsidize renewable energy facilities, the only possible source of these subsidies is either (1) taxpayers, or (2) electric customers -- which, of course, are really the same groups, i.e., everybody -- whether rich or poor.

One implication in Mr. Wood's letter is correct: Historically, this has meant money flowing from relatively impoverished ratepayers to wealthier people who have the resources and sophistication to invest in renewable energy facilities, either directly or indirectly. But, ultimately, the only thing that is impoverished here is the thinking. What's to stop municipal electric utilities like Hardwick's from investing in renewable energy and thus receiving the subsidies that H.446 would authorize? The Washington Electric Cooperative has invested in a landfill gas facility, for example; its member-customers are receiving the benefit of renewable energy credits sold to utilities in Massachusetts.

Mr. Wood mentions that his municipal utility can buy power at wholesale for as little as 6 cents per kilowatt-hour -- but he omits any mention of where that power would come from. The cheapest power available for wholesale purchase in New England comes from coal and nuclear plants. The Hardwick commissioner doesn't mention where his utility is currently getting its power. I have no idea myself, but his letter and his argument would be stronger if it included references to how the Hardwick Electric Department is already investing in renewable power without the mechanisms authorized by the bill he opposes.

Meanwhile, we can do as Governor Douglas proposes and wait for the renewable energy free lunch. Or we can be responsible about energy, and climate change, by acknowledging that every Vermonter will have to help bear the cost of developing the electricity sources that will allow us to continue to live in relative prosperity without making the planet inhospitable to future generations.

[Note to the meticulous: The photo at the beginning of the post isn't Hardwick -- it's Craftsbury.]