State energy policies may drive island's economy
State legislation regarding renewable energy sources is paving the way for Jamestown to make profitable use of its biggest resource, wind. With support from state government, the idea of becoming an energy-producing, economically independent community may not be as futuristic as it sounds.
Matt Auten, advocate for Environment Rhode Island, says if the current renewable energy bill is approved, the legislation would require the development of enough clean energy to power 130,000 homes with locally produced renewable power. The bill would require National Grid to enter into "commercially reasonable" long-term contracts to purchase electricity from renewable energy developers.
"For new projects to be viable they need to have a long-term guarantee that says: here is our revenue stream supported by a contract," Auten said. With this bill approved, Jamestown could develop turbines to sell generated electricity commercially.
The governor vetoed the bill late last month, citing unnecessary costs to taxpayers. The bill passed in both chambers by big margins, a vote of 52-11 in the House and 34-1 in the Senate, large enough to override a veto. A 60-percent majority vote is required for a veto override. But House and Senate leaders said they had not decided whether they would return for an override vote, according to their spokesmen.
Another clean energy state bill that has just passed addresses net metering. The new law allows a municipal project to sell up to 3.5 megawatts of power back to the utility company. More signif- icantly, Auten adds, the new law allows Jamestown, and any other community or private renewable project that is eligible under net metering, to generate as much power as they can and use that power throughout the year to off-set their own bills. The excess power generated can also be used to offset all other utility bills owned by the municipality, not just the bill for the closest municipal building.
Because of the net-metering policy, savings for communities is significant, running into hundreds of thousands of dollars. The project in Portsmouth, for example, cost about $3.5 million. "The biggest barrier for cities and towns is, what's our economic payback?" Auten says. "This could knock a couple of years off the payback period, it's a huge change. It will encourage communities like Jamestown. As a direct result of this law, we're going to see wind turbines go up. That's a great thing."
Yet, Jamestown Wind Committee Chairman Don Wineberg urges the island to look beyond net metering. Wineberg believes the clean energy bill that was vetoed may have more implications for Jamestown than the net metering bill that passed. The net metering bill was designed for small-scale projects that would allow turbines to be anywhere and take advantage of behind the meter use. All of the town's municipal load behind the meter would be put out by one turbine.
Wineberg points out that excess energy produced would have no buyer. If a project qualifies for net metering, the most it can do is reduce the electricity bill to zero. Then, any excess is transferred to the Rhode Island Renewable Energy Low-Income Fund. Even if Jamestown built just one, the town would still generate more energy than it would be worth to make use of the net metering bill. "We would reduce our electricity bill to zero, but we would have to give rest of the energy away."
Since the vetoed energy bill is geared toward commercial projects, windy Jamestown would benefit from the legislation if it were over-ridden. On a commercial scale, a key question Wineberg asks, "At what price will we be able to sell back to the grid?"
Wineberg talks about the wind committee and the feasibility study. As the panel considers recommendations to the Town Council, considering one turbine as a net metering turbine and then others for commercial may make economic sense. "It might make a lot of sense to pursue a smaller one that would meet the town's energy needs. If we can put turbines together and sell energy and make money off of it, let's do it."
The cost of getting turbines built is huge, Wineberg stresses. It would make no sense to do one small turbine dedicated to net metering, and then larger commercial turbines later on. "The cost of construction, the mobilization costs are very expensive."
The Economic Development Corporation will set up a fund of $1 million a year, a competitive grant program to help municipal projects, Austen says. Municipalities will be able to get up to half a million dollars for their projects. "The whole reason is to provide incremental funding for cities and towns that have wind resources."
The key to setting renewable energy facilities is the financial support, Auten emphasizes. State government has taken two major steps to make renewables very attractive to cities and towns. "We probably didn't get everything perfect, but the General Assembly took important steps to support communities, undoubtedly, with economic returns."
Sen. Teresa Paiva Weed, a strong and long-time proponent for the state's sustainable energy goals, praises the commitment of the senate toward clean energy. "In the past five years, the state senate has led the way in passage of comprehensive renewable energy legislation," she says. "While the Governor's recent veto of one such law is disheartening, we will continue to champion efficient and environmentally sound energy policy for the state."