Bill would let state’s utilities buy renewable-energy credits

08/08/2013 7:06 AM

08/08/2013 9:56 AM

Kansas and other states may soon be considering legislation by a pro-business political group that would let utilities meet renewable-energy standards by buying credits from companies in other states, instead of generating or buying their own clean power.

The bill would allow Kansas utilities to comply with state renewable-energy standards by purchasing credits – not actual power – from hydroelectric plants in the west, rather than investing the money directly in Kansas wind energy.

That could cause the state to lose the environmental, economic and employment benefits of companies building and operating wind farms in rural Kansas, opponents say.

Documents from the American Legislative Exchange Council show the proposed “model bill” will be considered this week by the group’s Energy, Environment and Agriculture Task Force.

ALEC is a group of business interests and like-minded lawmakers who gather to produce model legislation for state governments to adopt.

More than two dozen Republican members of the Kansas Legislature are expected to be in Chicago for the ALEC annual meeting, which started Wednesday.

Taxpayers have already paid the registration fees – $475 to $675 depending on when they registered – for 11 of them. More could file for reimbursement of travel expenses after the conference, said Jeffrey Russell, director of legislative administrative services.

One of them is Rep. Dennis Hedke, R-Wichita, chairman of the House Energy and Environment Committee and a member of the ALEC task force that will consider the renewable energy bill. Hedke said this week he was not fully familiar with the bill and could not immediately comment on it.

Hedke is an opponent of the Kansas renewable energy standards, which require power companies to get 10 percent of their power from renewable sources by 2010 and 20 percent by 2020. This year, Hedke floated a bill to delay and reduce the standards. It passed his committee but failed on a floor vote.

The ALEC bill “may be one way to skin that cat,” he said.

Pushback coming

ALEC shopped around a bill last year to try to get states to repeal their energy standards outright, but found little success.

Rep. Jim Ward, D-Wichita, said he sees the new bill as a backdoor move to try to accomplish what ALEC failed to do directly.

The bill would mandate that Kansas ratepayers pay for their utilities to buy renewable-energy credits, but Kansans wouldn’t get the benefits of cleaner air, ongoing investment in wind power, payments to farmers for use of their land or jobs building and maintaining windmills, Ward said.

Ward said Kansans would probably soon tire of paying for somebody else’s investments in renewable energy and demand repeal of the state standards, which is ALEC’s goal.

He said the main benefit of the current program is that it’s building a wind-power infrastructure, which is valuable to Kansas both for its own use and the potential for exporting power to other regions.

“They (ALEC) want us to get into the false choice of no (renewable energy) portfolio or buying these credits,” Ward said. “Neither is a good choice.”

Westar Energy, the state’s dominant power company, is unfamiliar with the bill and has no position on it, said Gina Penzig, director of corporate communications. The company now either generates or buys renewable power to meet its obligations, although Westar did get some credit early on in the program for wind power it generated before the renewable-energy standard was established, she said.

The standard was part of a “grand bargain” struck by former Democratic Gov. Mark Parkinson. In exchange for getting renewable energy, he signed off on approving a controversial coal-fired power plant near Holcomb in western Kansas, a major priority for conservative Republicans in the Legislature.

Ward said he was in the room four years ago when Parkinson told stunned Democratic lawmakers that he was bending on the coal plant, which appeared to have been stopped by them and Parkinson’s predecessor, Gov. Kathleen Sebelius.

“I was there when people said, ‘Governor, you’re buying a pig in a poke. As soon as your term is up they will go ahead and eliminate the portfolio standard and continue to build the coal plant,’” Ward said. “There were people who very much believed that the conservatives were not to be trusted.”

ALEC and Kansas

ALEC’s members-only deliberations are important because they often find their way into Kansas law.

Requirements for voter photo ID and proof of citizenship, limits on monetary damages for injured workers and a ban on voluntary payroll deductions for public-workers union political activities are all ideas that came from ALEC and passed into Kansas law.

In some cases, the state Legislature adopted ALEC bills practically word for word, including a resolution denouncing the Environmental Protection Agency as a “regulatory train wreck” and the Kansas Health Care Freedom Act, which sought to exempt state residents from the Affordable Care Act.

State House Speaker Ray Merrick, R-Stillwell, and Senate President Susan Wagle, R-Wichita, are both public-sector national board members of ALEC. Wagle is a past chairwoman of ALEC and Merrick is its Kansas state chairman.

Economist Arthur Laffer, chief architect of Gov. Sam Brownback’s plan to eliminate Kansas income taxes, is a member of ALEC’s Board of Scholars and one of the featured speakers at this week’s conference.

Earlier this year, Kansas lawmakers delayed their annual legislative wrap-up session so that representatives and senators could attend an ALEC regional conference in Oklahoma City.

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