Guest Editorial for the Jefferson Post (November 2007):
Doug Johnson, Chief Executive Officer,
Blue Ridge Electric Membership Corporation
As you may know, the North Carolina General Assembly passed legislation late this summer to encourage generation of more electricity from renewable resources such as wind, solar and biomass (hog and poultry waste).
The new law applies to utilities that produce electricity and also to distribution utilities like Blue Ridge Electric which purchase electricity on the wholesale market to distribute to their consumers. By the year 2018, Blue Ridge Electric and other cooperatives are required to get at least 10 percent of their power form renewable sources and energy efficiency. For larger investor-owned utilities, the requirement is 12.5 percent.
This new legislation is designed to bring more renewable energy to our state in a time when the population and demand for energy is dramatically increasing. Projections show that over the next 30 years, North Carolina’s electric utilities must supply energy to approximately 3.5 million more consumers. Blue Ridge Electric is already working to help meet this demand in our area by constructing new distribution facilities to replace an aging electric infrastructure originally built in the 1950s and ‘60s.
The state’s energy policy is also designed to help address growing power demand by including traditional base load generation sources such as coal, nuclear and natural gas. We believe this mix of resources for electricity generation will be critical to delivering highly reliable power. It will also help utilities incorporate more renewable energy resources in a way that protects consumers from burdensome cost increases while meeting the growing electric power requirements for North Carolina.
Like other utilities, Blue Ridge Electric is currently developing our strategy to meet the state’s renewable energy mandates.
First, we are closely coordinating with our power supplier, Duke Energy. As a distribution utility, a major part of our plan to meet the standards depends upon purchasing our power from a supplier whose generation portfolio meets the requirements of the renewable energy standard. We are working closely with Duke on our wholesale power contract to ensure it includes renewable energy. Additionally, our existing contract with Southeastern Power Administration for federal hydropower helps us meet the state mandate.
Energy efficiency measures will also play a large role in meeting the new standards. Blue Ridge Electric has always emphasized energy conservation and efficiency and I believe the direction for all North Carolina utilities will be to strongly encourage consumers to reduce energy consumption where possible and to become wiser energy users.
We also help our members wanting to implement personal renewable energy projects. We have interconnection policies and procedures for connecting solar, hydro or other renewable energy projects to the grid. We have net metering and net billing policies that allow our members to sell us any excess power generated by a system they own. Additionally, we assist members with qualifying renewable energy projects in applying for the appropriate credits from NC GreenPower, the states independent, nonprofit renewable energy initiative created by the NC Utilities Commission to encourage more renewable energy.
A key goal for Blue Ridge Electric as we work to meet the state’s new renewable energy standard is to achieve these objectives in a way that meets the intended purpose without dramatically increasing costs. It is well documented that renewable energy costs more to produce than traditional generation resources and electric consumers will pay this additional cost through higher electric bills. The new legislation helps protect consumers with a retail cost cap limiting what consumers can be charged for the renewable energy portion of their bills. For residential consumers, this is an annual cap of $10 through 2012. The amount increases to $12 through 2014 and moves to a cap of $34 in 2015.
As a member-owned electric cooperative, our responsibility is to ensure that electricity is delivered to our members in a highly reliable manner and at the most affordable price possible. Our responsibility is also to be good environmental stewards as we work to meet the goals of the state’s new renewable energy legislation.
While we are developing our plans to meet North Carolina’s renewable energy requirements we are also closely watching developments on a federal level. Next month, I’ll discuss Congressional initiatives for renewable energy and potential national energy policy changes.
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