Spokanes two major electric utilities say they have concerns about a proposed initiative that would make all of Washington states larger utilities get 15 percent of their power from renewable sources, such as wind, solar, and biomass, by 2020.


A coalition of environmental and other public-interest groups that calls itself Washingtonians for Energy Security is promoting the measure, Initiative 937, and hopes to get it placed on the November ballot. The campaign, which has been gaining momentum, received what its backers claim was a huge boost last month when the board for the Washington Public Utility Districts Association voted to support the measure.


Executives from investor-owned Avista Corp. and customer-owned Inland Power & Light Co., both of which are based here, say those utilities support the development of more renewable-energy generation, but worry about how a mandate with specific deadlines for expanding the use of renewable power would affect rates.


Avista serves 330,000 electric customers and 305,000 natural gas customers across the Inland Northwest. Inland Power, the states largest electric cooperative, has more than 35,000 customers, located largely in rural areas.


Avista has decided to remain neutral on the initiative for now, says Tom Paine, its government relations director.


Were not opposing it, he says, but he adds, We think its going to take a fair amount of clarification if the initiative passes. Our biggest concern about being mandated is it reduces your flexibility to make sure those renewables are cost-effective.


Inland Power CEO Kris Mikkelsen was more critical of the measure, saying, We have major concerns about it and intend to convey those to our members. We are very concerned about the cost of this moving forward.


Inland Power is a member of the Washington Rural Electric Cooperative Association, which represents about 20 small and rural electric utilities. That organization hasnt announced a formal position yet on the initiative, but Mikkelsen says she expects that it will oppose the measure.


It flies in the face of local control, and thats always a basic tenet of the co-op philosophy, she says. The Association of Washington Business, the states largest business group, also opposes the initiative.


Supporters of it include Audubon Washington, Climate Solutions, Northwest Energy Coalition, Northwest Energy Efficiency Council, Northwest Sustainable Energy for Economic Development, Renewable Northwest Project, the Sierra Clubs Cascade chapter, and United Steelworkers, among others.


Backers argue that the initiative is needed to provide more stability for electricity consumers and to buffer them from the price and supply volatility inherent in the fossil-fuel market. They say also that it would help keep the states air clean, partly by providing a practical alternative to major expansion of coal-fired electricity in the Northwest, and by helping avoid more global-warming emissions.


They say that the renewable-energy and energy-efficiency industries already provide more than 4,000 jobs in the state, and they claim that the initiative would create thousands of additional jobs. The initiative also would provide new economic-development opportunity for rural communities, they assert, such as through lease income that land owners could derive from wind turbines and the potential for turning costly animal and plant waste into biomass energy.


The initiative doesnt count current hydroelectric generation as a renewable source, since the focus is on new capacity, but utilities would get credit for projects that boost the generating efficiency of dams. The 15 percent renewable benchmark would be phased in over eight years, beginning at 3 percent in 2012 and bumping up to 9 percent in 2016.


As a cost-cap proviso, the initiative states basically that utilities will be considered in compliance with the law if using renewable sources costs them at least 4 percent more than relying on nonrenewable sources in any given year. Utilities that fail to comply with the renewable standards, though, would face a penalty, currently set at $50 for each megawatt-hour of shortfall.


The initiative applies to utilities with more than 25,000 customers, which encompasses about 17 of the states more than 60 public and private electric-energy providers. The coalition thats promoting the initiative claims that similar legislation has been enacted in at least 20 other states. It has until early July to collect the more than 224,000 signatures of registered voters that are needed to qualify the measure for the November ballot.


Because there are some uncertainties in the bill, were a little reluctant to just recommend carte blanche that our customers vote for it, Avistas Paine says. He adds, though, that, We are on a path to acquire more renewable energy.


Avistas energy-source mix currently is about 54 percent hydroelectric, 30 percent natural gas, 13 percent coal, 3 percent biomass (coming from a Kettle Falls plant thats too old to be eligible under the initiative), and 1 percent wind power, Paine says.


He notes, though, that Avista recently has been seeking proposals for additional long-term renewable energy supplies, as outlined in a new integrated resource plan (IRP) the company completed last year. The long-term plan lays out a strategy for meeting projected future energy demands.


We think our IRP brings us to the level the initiative specifies, and we probably wont have trouble meeting it, Paine says.


Nevertheless, the company traditionally has taken the view that regulatory mandates, such as what this initiative seeks to impose, may not be in the best interests of the customers, he says, adding, Thats always our No. 1 concern, to make sure that its cost-effective.


Inland Power currently obtains all of its power from the Bonneville Power Administration, so Mikkelsen is unsure just how it would be able to comply with the initiative. Presumably, she says, it would have to collaborate with BPA somehow to find a solution or be forced to develop its own generating capacity.


Wind clearly is the most viable source of renewable energy available currently, she says, yet shes not at all sure if theres enough wind out there to provide the amount of generation needed to comply with the initiative standards. Another problem with wind energy, she contends, is that sometimes the wind doesnt blow, which creates a need to devote resources to costly backup generation.


Also, although its true that 20 other states have adopted similar renewable-energy measures, the initiative being proposed here appears to be more onerous than almost any of them, Mikkelsen says.


Whatever the law is, well do our best to comply with it, she says. I just think theres much better ways to encourage renewable-energy development than with an artificial mandate.


Adds Mikkelsen, I think whats going to happen is two or three or four years from now, people are going to wake up to this thing and just be scrambling to make the mandate, and its not going to be possible.


Contact Kim Crompton at (509) 344-1263 or via e-mail at kimc@spokanejournal.com.