Critics of the so-called “Clean Energy Jobs Act” (CEJA) bill are pointing to a major assumption it makes about future national regulation of carbon emissions that would make or break the bill.
Right now it is cheaper to produce electricity from fossil fuels than from renewable sources. Supporters of CEJA are counting on that to change.
In calculating the cost-benefits of CEJA, The Wisconsin Public Service Commission “assumed a future cost for emitting carbon dioxide from power plants that starts at $20/ton and rises slowly with inflation,” according to the Office of Energy Independence. If that happens, the PSC says it will then be cheaper to produce electricity from renewable sources than from fossil fuels.
To capitalize on that possibility, CEJA would enforce Renewable Portfolio Standards (RPS) that set requirements on how much renewable energy utilities would have to sell. By 2025, a full 25 percent of all electricity sold in Wisconsin would have to come from renewable sources, under the bill.
If the PSC’s assumption is correct, the Office of Energy Independence predicts “electric utility bills would go down under this legislation.” However, to date, the federal government has had little luck in passing that type of carbon regulation, the PSC is counting on.
Representative Mike Huebsch (R-West Salem) argued it’s dangerous to base state legislation on what might or might not happen in Washington at some unkown date in the future.
“Those are tremendous assumptions and take remarkable leaps of faith, because if Cap and Trade in Washington isn’t dead, it’s certainly on life support,” stated Heubsch during a panel discussion.
Representatives Spencer Black (D-Madison) and Jim Soletski (D-Green Bay), who wrote the Assembly version of the Clean Energy Jobs Act, sat on the panel with Heubsch and defended reying on the assumption.
Representative Soletski argued it is not a great leap of faith to believe Washington will eventually pass some form of carbon regulation, and Wisconsin needs to be ready for it.
“If not now, when? It’s going to happen,” said Soletski. “We are going to put an emphasis on renewables. We are going to put an emphasis on efficiency. Are we going to do this in 2010, or are we going to do this in 2020 or 2030?”
Representative Black argued other states used the same methods as Wisconsin in analyzing potential climate legislation, but Wisconsin has been much more responsible in its assumptions.
“Other states have actually gotten much more robust numbers,” said Black. “Very intentionally, the Public Service Commission put in the most conservative assumptions, so it is completely defensible.” (Source: MacIver Institute)
So now we pass legislation in Madison based on assumptions? Nice.
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