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FEBRUARY 16, 2010 | Policy Brief by ELIZABETH BRYAN, KATRINA CURRIE
Business Guide to Electric Choice & Competition
In the late 1990s, Pennsylvania's electricity rates were 15% above the national average, despite the abundance of low-cost coal generation in the Commonwealth. At that time, electricity was sold by a monopoly utility provider per designated region. Then federal regulations changed to allow electricity markets to develop. The state legislature re
JANUARY 5, 2010 | Policy Brief by ELIZABETH BRYAN, KATRINA CURRIE
Citizen's Guide to Electric Choice & Competition
In the late 1990s, Pennsylvania's electricity rates were 15% above the national average, despite the abundance of low-cost coal generation in the Commonwealth. At that time, electricity was sold by a monopoly utility provider per designated region. Then federal regulations changed to allow electricity markets to develop. The state legislature re
DECEMBER 23, 2009 | News Release by COMMONWEALTH FOUNDATION
Climate Change Action Plan Fails to Balance Evidence
The Commonwealth Foundation today expressed dissatisfaction with the process and conclusion of the Climate Change Advisory Committee's (CCAC) action plan for Pennsylvania. The plan deviates from key objectives listed in Act 70 of 2008, provides Pennsylvanians an insufficient analysis of the economic costs of policy proposals, and does not
Recent Blog Posts
MARCH 17, 2010
Gas Bags Scare Off Gas Investor
In an interview with CNBC, Larry Nichols, CEO of the highly-successful Devon Energy, claimed his company will not be seeking a share of the Marcellus Shale gas reserves anytime in the near future. The reason he cites? The political war going on over whether and how much to tax and regulate the industry.
The Marcellus shale is certainly an attractive place to be, and we don’t want to diminish that in any way. But when we looked at all the shale plays and where we could grow production the fastest, and grow it with the least amount of political problems, it was not high on our list.
What's ironic about is that the very company environmentalists are discouraging with "political problems" has been recognized as one of the nation's top promoters of clean energy and sustainable corporate practices. Devon Energy was even given the DEP's STAR award for "Rookie of the Year" in 2004 and "Production Partner of the Year" in 2005. They are considered an industry front runner in waste water recycling, and were deemed as one of Fortune Magazine's 100 Most Admirable Companies.
So now, not only does Pennsylvania's poor economic climate cost a job creator, but one of the most environmentally-friendly companies.
posted by MICHAEL NEROZZI | 08:44 AM | 0 comment
MARCH 16, 2010
The Green Schools Ruse
Yesterday the House passed Rep. Drucker's bill to exclude any costs associated with making a school building LEED certified from a possible taxpayer referendum.
Committee staff reported the department said there is a dollar amount threshold for referendums and green building costs can be excluded from that in order to avoid a referendum. Staff said, according to the department, if there is a referendum anyway, all projects will be included in the ballot question, including green construction. (PLS subscription)
With the cost of school construction and debt spending on the rise this bill could have wide implications. As noted in Nate Benefield's testimony on education spending:
Construction and debt spending grew 137% from 1996-97 to 2007-08, compared with 66% growth in instructional spending.
In committee, legislators debated whether green construction is more expensive and Rep. Drucker indicated responded the upfront costs are but the long-term costs are "significantly less". And Rep. Clymer hit the nail on the head when he asked why the exemption is needed if green technology is accepted by the taxpayers.
HB 689 hinders the ability of local taxpayers to gauge the true cost of school construction in their district and is just one more way government favors alternative energy companies at the expense of taxpayers.
posted by ELIZABETH BRYAN | 11:12 AM | 0 comment
MARCH 12, 2010
Could Municipalities Provide Cheaper Electricity?
Last week the State House Committee on Consumer Affairs held a hearing on legislation which would allow municipalities to act as electricity aggregators for residents, unless they opt-out for another supplier. Pennsylvania Consumer Advocate Sonny Popowsky explains:
The theory behind municipal aggregation is that by aggregating the buying power of a
large number of small customers, a non-profit municipal entity can get a better deal for those
customers than if those customers each go out and shop for electricity on an individual basis. In addition, many customers may have neither sufficient interest nor sufficient understanding to choose their own supplier of a product that they have never had to shop for.
While this could go a long way in encouraging competition, Duquesne Light and other Providers of Last Resort (POLR) point out that allowing entire municipalities to choose alternative suppliers creates more uncertainty, making it difficult for them to provide "least-cost" electricity through long and short-term contracts, as mandated in Act 129.
Any opt-out program should be free of restrictions or penalties that would prevent residents from leaving the municipalities program at any time. Municipal aggregators can be an effective tool to encourage more electricity shopping but, giving the power to elected leaders to negotiate contracts could easily lead to cronyism. Municipalities should stick to opt-in programs, where residents have to opt into the city's electricity aggregation maximizing consumer choice.
posted by ELIZABETH BRYAN | 10:34 AM | 0 comment
