September 17, 2013
Performance audit requested on I-937, renewable energy

When Gov. Jay Inslee signed the current two-year budget on June 30, he vetoed a study that was to look into how much more customers pay for electricity to meet Initiative 937's renewable energy standards. The initiative, which does not count hydroelectric power as renewable, passed with 51.7% in 2006, a year that saw Democrats sweeping races around the state.

In his veto of the study, which was to be conducted by the bipartisan Joint Legislative Audit and Review Committee, Inslee said that the study would "assess the cost impacts of the state's renewable electricity standards without also evaluating the environmental and economic benefits of renewable energy" and that "the study is unnecessary, as there are cost controls built into the standards." As we noted at the time, Inslee's veto didn't win him any plaudits from east side papers The Spokesman Review and The Tri-City Herald.

Now numerous state legislators, the Washington Policy Center, and representatives of Eastern Washington chambers of commerce are appealing to State Auditor Troy Kelley to undertake a comprehensive performance audit of I-937. Under that initiative, the State Auditor's Office was given oversight over some of its provisions, and I-900 gave the office the power to conduct performance audits of government functions.

The letter asks Kelley to evaluate "how the law is impacting the energy market in Washington and if the law's promises, including reducing carbon emissions, are being realized." Specifically, they believe Kelley should examine these questions:

  • How many others states/countries with renewable energy production targets exclude hydro generated power from their targets?

  • Is the implementation of I-937 saving businesses and consumers money as promised?

  • Are the renewable energy targets of I-937 resulting in cheaper energy production as promised?

  • Have the renewable energy requirements reduced the carbon intensity of Washington's electricity?

  • How much have the policies of I-937 either reduced or increased the electricity bills for businesses, governments, and private residences and by how much?

  • Have the policies of I-937 resulted in Washington utilities selling excess hydro power to other states?

  • Inslee's veto of the JLARC I-937 study brings to mind the questionnaire he filled out to receive the endorsement of the League of Conservation Voters. Inslee refused several opportunities during the campaign to release his answers to their questionnaire, which asked this:

    In 2006, the environmental community placed on the ballot and passed I-937, the Clean Energy Initiative, to ensure that at least 15 percent of electricity we get from major utilities comes from new renewable sources. Since passage of the initiative, I-937 has come under attack in Olympia from utilities and businesses who seek to lessen or eliminate these requirements. We believe I-937 is working as intended. Most utilities are on track to meet the first step for renewable energy and energy efficiency in 2012.

    As Governor, what will you specifically do to ensure that the state maintains the integrity of I-937 and that it is not weakened by the Legislature?

    Inslee's answer to that is more relevant than ever - why not release it?

    **Update**
    Washington State Wire has a great piece up about the thinking of some major players in the debate over I-937's future.

    Posted by Adam Faber at September 17, 2013 10:24 AM | Email This
    Comments
    1. So in short. We need taxpayer dollars to have State Auditor Troy Kelley -repeat - Troy Kelley conduct a performance audit on the renewable energy initiative?

    And just what do you expect the results of the audit will be? Can we get a clip Claude Rains as Captain Louis Renault in Casablanca?

    Posted by: Don Ward on September 17, 2013 04:00 PM
    2. Now numerous state legislators, the Washington Policy Center, and representatives of Eastern Washington chambers of commerce are appealing to State Auditor Troy Kelley

    Adam Faber, you hilarious HACK!

    Hey, here's an idea for you. Why don't you, policy director of Rob McKenna's gubernatorial campaign, team up with fellow (un)SP front pager and notorious grifter, Tim Eyman, and take your case to the people to resend I-937?

    Heck, you could convince the Washington Policy Center (headquartered in liberal Seattle and not in Eastern Washington) perform and publish its own "study".

    I know why you won't, because you'd get your ass handed to you.

    Posted by: MikeBoyScout on September 17, 2013 04:29 PM
    3. The initiative, which does not count hydroelectric power as renewable...

    I-937, Section Three. Paragraph 18: "Renewable resource" means: (a) Water; (b) wind; (c) solar energy; (d) geothermal energy; (e) landfill gas; (f) wave, ocean, or tidal power; (g) gas from sewage treatment facilities...

    Adam, are you getting your "facts" from the grifters at WPC, or is there some actual, legitimate reason to believe "hydro power" is not a "renewable resource" under the definitions given in I-937?

    Heck, you could convince the Washington Policy Center (headquartered in liberal Seattle and not in Eastern Washington) perform and publish its own "study".

    To be fair, they have their Home Office in Seattle, but they have a legislative office in Olympia -- that's sixty whole miles away! -- and a regional office in Eastern Washington. (Because you can't write a blog post just anywhere, you know.) WPC -- showing government how to be efficient since whenever it was they were founded.

    Posted by: tensor on September 17, 2013 05:24 PM
    4. tensor:

    Section 3, paragraph 10: (10) "Eligible renewable resource" means:

    (a) Electricity from a generation facility powered by a renewable resource other than fresh water that commences operation after March 31, 1999, where: (i) The facility is located in the Pacific Northwest; or (ii) the electricity from the facility is delivered into Washington state on a real-time basis without shaping, storage, or integration services; or

    (b) Incremental electricity produced as a result of efficiency improvements completed after March 31, 1999, to hydroelectric generation projects owned by a qualifying utility and located in the Pacific Northwest or to hydroelectric generation in irrigation pipes and canals located in the Pacific Northwest, where the additional generation in either case does not result in new water diversions or impoundments.

    That pretty much excludes hydro, except for upgrades at existing facilities.

    Posted by: Dishman on September 17, 2013 05:50 PM
    5. Lefties are so arrogant and stubborn that they think the laws of physics do not apply to their favorite energy sources. That is why they subsidize and support the least effective and lowest energy density sources like wind and solar.

    Posted by: Leftover on September 17, 2013 10:49 PM
    6. Why the fear of actually implementing I-937, and seeing how well - or how poorly - it's done? I guess we should just take classes in school and never test or check homework, either...

    Posted by: Shanghai Dan on September 18, 2013 06:33 AM
    7. Adam and Dishman, your confusion could be cured by, um, reading. The first words of I-937 are: "AN 1 ACT Relating to requirements for new energy resources ...". (emphasis mine) It doesn't say hydropower isn't renewable, it says old hydropower isn't new. Duh.

    I'm sure different people supported I-937 for different reasons, but the policy goals stated clearly at the beginning of I-937 are different from those you now want to waste taxpayer money studying through your absurdly leading questions.

    Posted by: Bruce on September 18, 2013 08:42 AM
    8. "6. Why the fear of actually implementing I-937, and seeing how well - or how poorly - it's done?"

    We're doing that already. The question here is whether we'll waste taxpayer money holding a law to new, different, snd higher standards because people who opposed the law all along are looking for an excuse to avoid further implementation of it.

    "I guess we should just take classes in school and never test or check homework, either..."

    Or, as Bruce notes, we can check math homework for spelling errors. Not much value-added there, eh?

    Posted by Shanghai Dan at September 18, 2013 06:33 AM

    Posted by: tensor on September 18, 2013 12:15 PM
    9. The whole issue of whether new hydro projects are "clean" or not is moot since there is literally no more room for major hydro projects in the state. The only section of the Columbia River where there is room for another dam is the Hanford Reach and - quite frankly - that area should be preserved in its natural habitat.

    That goes for most of the state's secondary river systems as well (think Puyallup or Nisqually sized) since they already have have hydro or flood control dams on them and just about all of their surplus water flow has been tapped for municipal or irrigation purposes.

    That only leaves room for micro projects such as one proposed on the Little Mashell Falls near the town of Eatonville in Pierce County which would have diverted part of the flow through a very small pipe/turbine generator and would have been enough juice to power (if memory serves) a couple hundred homes.

    With the political situation being what it is, it's irrelevant whether such a hypothetical project would be considered "green" because if I-937 or not because there's no way it would be able to pass all the state and federal permit processes in the first place.

    Posted by: Don Ward on September 18, 2013 12:49 PM
    10. Following up on what Bruce wrote, it's amusing to compare the requests Adam quoted to the actual stated intent of I-937. There's literally nothing in the stated intent of I-937 about the "promised" savings of money, or any "promised" reducing the overall cost of power. Yet another reason, as if we ever lacked for one, why the WPC can be simply ignored on the topic of policy in Washington state.

    That the most bitterly intractable critics of I-937 have engaged in such flagrant goalpost-moving is itself an excellent indicator of I-937's success.

    Posted by: tensor on September 18, 2013 01:15 PM
    11. The Voters' Guide in 2006 made the following promises or statements if you prefer: https://wei.sos.wa.gov/agency/osos/en/press_and_research/PreviousElections/2006/Documents/206Gen-Large.Print.VP.pdf

    "INITIATIVE 937 SAVES ENERGY AND SAVES US MONEY: I-937 gives us cheaper, renewable alternatives like wind and solar. According to Puget Sound
    Energy, just two Washington wind farms are projected to save consumers $170 million. Renewable energy strengthens family farms by paying up to $5,000/year per wind turbine.
    I-937 also saves money by requiring utilities to offer energy efficiency programs, like cash
    rebates for energy efficient appliances, home weatherization, and lighting, heating and cooling
    systems for businesses . . . Yes on I-937! For cleaner air and more affordable energy."

    To be fair of course, the proponents of I-937 may not have meant what they said.

    Posted by: jason on September 18, 2013 02:16 PM
    12. Jason@11, as I said, different people doubtless had different reasons for voting for I-937. Statements in the Voters' Guide are part of a campaign, not part of the law. Do taxpayers really want to spend money to fact-check every campaign promise 7 years later? Do taxpayers really want to do cost/benefit analysis of every policy? (Speed limits? Park maintenance? Every environmental law?) How often? How will you weigh the nonfinancial benefits?

    Given that a study like this would be unlikely to change policy, would you favor a study on the cost/benefit of doing pointless studies?

    Partisans are always free to do this sort of political analysis and publicize the results, but to ask taxpayers to do that political research for them is ridiculous.

    Posted by: Bruce on September 18, 2013 02:32 PM
    13. Yeah, I'm with Bruce! Why would we want to know if the law is effective? That'd be stoopid.

    Posted by: Uhh... on September 18, 2013 03:25 PM
    14. Jason -- follow the link to the WPC's letter. It clearly (and fasely) refers to "the law's promises..." and then follows with their laundry list of items which were not "promised" by I-937, the list Adam foolishly quoted. (I tried to warn him about the WPC, but no...) Most of us understand new technologies require capital investment, and that time will pass before their benefits are realized. That's why the law sets a target of 2020 for full realization of the few things it actually does require.

    To be fair, of course, maybe the proponents of this audit have no clue as to what they're talking about.

    Posted by: tensor on September 18, 2013 03:28 PM
    15. What has got me frosted the most over this issue (as you can tell) is that not only is it political grand standing. It is STUPID political grand standing.

    What we have here is a "sternly written letter" penned by the Washington Policy Center and the GOP. They know full well that State Auditor Troy Kelley (a Democrat!) will not conduct any meaningful performance audit. It's a bit of political kabuki theater.

    The worst thing that can happen is that Auditor's office actually does take them up on the offer and perform the audit. You don't need a crystal ball to tell you the end result will be "working as intended". And then that becomes the lead news story and state GOP and WPC winds up looking like even bigger fools.

    It's handing a sword to your political opponent. Idiotic process ridden drivel like this that causes the GOP here in this state to lose over and over again.

    Posted by: Don Ward on September 18, 2013 03:36 PM
    16. Uhh@13, define "effective"; is it "doing what it said it will do" or "doing everything that anyone in favor if it ever said it would do" or "doing things that its opponents would like a different law to do"? And how much money should the government spend to study this? For every law ever passed? Every decade? Every year? Or just for laws you don't like?

    Posted by: Bruce on September 18, 2013 03:50 PM
    17. The law was passed on 2006. It set out targets, resource costs, and accountability. The target date for meeting the goals of the bill was 2020. We are about half way there, what's the status?

    NEW SECTION. Sec. 1. INTENT. This chapter concerns requirements for new energy resources. This chapter requires large utilities to obtain fifteen percent of their electricity from new renewable resources such as solar and wind by 2020 and undertake cost-effective energy conservation.

    Large utilities that obtain most of their energy from hydro will not get credit for that: only for (10) "Eligible renewable resource" means: (a) Electricity from a generation facility powered by a renewable resource other than fresh water that commences operation after March 31, 1999

    So, if they get 85% from hydo, they must totally replace the other 15% with "new renewable" to comply with the law.

    NEW SECTION. Sec. 2. DECLARATION OF POLICY. Increasing energy conservation and the use of appropriately sited renewable energy facilities builds on the strong foundation of low-cost renewable hydroelectric generation in Washington state and will promote energy independence in the state and the Pacific Northwest region. Making the most of our plentiful local resources will stabilize electricity prices for Washington residents, provide economic benefits for Washington counties and farmers, create high-quality jobs in Washington, provide opportunities for training apprentice workers in the renewable energy field, protect clean air and water, and position Washington state as a national leader in clean energy technologies.

    Are energy rates stabilized? How destable were they before? Are the economic benefits beign realized? How many high quality jobs have been created due to this law? How many apprentice workers are in training due to this law? Where do we stand with other states in being a national leader in clean energy technologies?

    (10)(b) Incremental electricity produced as a result of efficiency improvements completed after March 31, 1999, to hydroelectric generation projects owned by a qualifying utility and located in the Pacific Northwest or to hydroelectric generation in irrigation pipes and canals located in the Pacific Northwest, where the additional generation in either case does not result in new water diversions or impoundments.

    (17) "Renewable energy credit" means a tradable certificate of proof of at least one megawatt-hour of an eligible renewable resource where the generation facility is not powered by fresh water,

    (18) "Renewable resource" means: (a) Water; (b) wind; (c) solar energy; (d) geothermal energy; (e) landfill gas; (f) wave, ocean, or tidal power; (g) gas from sewage treatment facilities; (h) biodiesel fuel

    NEW SECTION. Sec. 4. ENERGY CONSERVATION AND RENEWABLE ENERGY TARGETS. (1) Each qualifying utility shall pursue all available conservation that is cost-effective, reliable, and feasible.

    (2)(a) Each qualifying utility shall use eligible renewable resources or acquire equivalent renewable energy credits, or a combination of both, to meet the following annual targets:
    (i) At least three percent of its load by January 1, 2012, and each year thereafter through December 31, 2015;
    (ii) At least nine percent of its load by January 1, 2016, and each year thereafter through December 31, 2019; and
    (iii) At least fifteen percent of its load by January 1, 2020, and each year thereafter.

    How are we doing on these targets? Meeeting or exceeding these goals?

    NEW SECTION. Sec. 5. RESOURCE COSTS. (1)(a) A qualifying utility shall be considered in compliance with an annual target created in section 4(2) of this act for a given year if the utility invested four percent of its total annual retail revenue requirement on the incremental costs of eligible renewable resources, the cost of renewable energy credits, or a combination of both, but a utility may elect to invest more than this amount.

    How many utilities are in covered under this law and how many are in compliance?

    NEW SECTION. Sec. 6. ACCOUNTABILITY AND ENFORCEMENT. (1) Except as provided in subsection (2) of this section, a qualifying utility that fails to comply with the energy conservation or renewable energy targets established in section 4 of this act shall pay an administrative penalty to the state of Washington in the amount of fifty dollars for each megawatt-hour of shortfall. Beginning in 2007, this penalty shall be adjusted annually according to the rate of change of the inflation indicator, gross domestic product-implicit price deflator, as published by the bureau of economic analysis of the United States department of commerce or its successor.

    How many utilities have been required to pay this penalty?

    NEW SECTION. Sec. 7. REPORTING AND PUBLIC DISCLOSURE. (1) On or before June 1, 2012, and annually thereafter, each qualifying utility shall report to the department on its progress in the preceding year in meeting the targets established in section 4 of this act,

    Are we getting these reports? What are they telling us?

    Why are the progressives afraid of an audit to determine if this potentially expensive bill is actually bringing in the efficiencies, benefits, jobs, and clean air and water the authors claimed as the intent of the legislation?

    Posted by: SouthernRoots on September 19, 2013 06:06 AM
    18. @19....because "it will just be good for us". No need to know if it will. Look at the SLUT in Seattle or the LinkLight rail. They say it is good for us, so darn it the projects must be OK no matter what....why know if they are.

    Posted by: Dengle on September 19, 2013 10:37 AM
    19. Roots -- I-937 identifies the Washigton State Department of Commerce as the agency to which qualifying utilities must report compliance. Putting "I-937" into the search box on the Department's home page gets you this page, which reads, in part:

    "In June 2012, utilities submitted the first of their annual conservation reports. All reported they had met or exceeded initial two-year targets."

    A link on that page, to "EIA Reporting", will take you to the page where the qualifying utilities reported their compliance data. Happy reading -- unless, of course, you righties are afraid of seeing hard economic data on how well liberal government policies improve industrial efficiency.

    Now, how many taxpayer dollars should be spent on an audit to replicate this two-minute web search? Can we bill the Washington Policy Center for any time the State Auditor spends on explaining how their request shows an abject ignorance of I-937's intent and effects?

    Posted by: tensor on September 19, 2013 12:08 PM
    20. @16, I completely agree with you again Bruce. 937 can't really be measured in any way. Teachers effectiveness can't really be captured, either. And the president's claim that people would save $2,500 under his health plan? Also not measured. None of the things liberals want can be measured or evaluated.

    Posted by: Uhh... on September 19, 2013 08:13 PM
    21. Uhh, the targets given in I-937 are specific and measured; the data appears where I showed it was. Are you thinking of the "promised" benefits specified by the WPC? Those false claims seem to fit your description much better than the actual targets which I-937 really specified.

    Posted by: tensor on September 19, 2013 08:21 PM
    22. Uhh@21, if you want to participate in an intelligent conversation, consider answering my questions rather than misrepresenting what I said.

    Posted by: Bruce on September 20, 2013 08:37 AM
    23. Ironically, the Democrats are now becoming the opposite of what they claim. They claim to be the party of freedom and protection for the little guy. But who really trusts Barack Obama or Hillary Clinton to use less surveillance on us in light of revelations of Edward Snowden and ??? Manning?

    And think about all those check-box questions you are now asked to answer at every doctors visit, regarding your sexuality, and so on. How long before you are denied healthcare based on "unapproved" personal decisions? This will be entertaining when Progressives cannot get treated for grossly hedonistic behavior under their own pet healthcare system.

    Posted by: Leftover on September 20, 2013 10:53 AM
    24. And I should clarify:

    It is not that I think the right wing will necessarily be any less willing to abuse government. But that a more libertarian direction sure as hell is NOT EVER coming from the ever expanding Statist Progressive Left.

    If you want to have a truly reasonable middle ground, vote for libertarian/ right candidates. Because all you will get from the Left is a larger bill, with no results.

    Posted by: Leftover on September 20, 2013 11:38 AM
    25. "If you want to have a truly reasonable middle ground, vote for libertarian/ right candidates. Because all you will get from the Left is a larger bill, with no results."

    That's flat-out hilarious, coming in a thread where we've determined the liberal I-917 has produced the results specified, and the right-wing/glibertarian WPC is begging for government assistance because it can't understand this.

    Posted by: tensor on September 20, 2013 01:36 PM
    26. Leftover@24 frets, "think about all those check-box questions you are now asked to answer at every doctors visit, regarding your sexuality, and so on."

    I'm thinking... I'm thinking... oh yeah, the doc asks if I use sunscreen! Thanks for pointing out that he is trying to take away my freedom with irrelevant, freedom-hating questions!

    "How long before you are denied healthcare based on "unapproved" personal decisions?"

    Gosh, I'm gonna guess "never" here. The only personal decision that anyone has ever seriously suggested shouldn't be covered is sex by a woman. And that suggestion didn't come from the "statist progressive left"; it came from the right.

    Posted by: Bruce on September 20, 2013 03:19 PM
    27. Bruce wrote:
    Adam and Dishman, your confusion could be cured by, um, reading. The first words of I-937 are: "AN 1 ACT Relating to requirements for new energy resources ...". (emphasis mine) It doesn't say hydropower isn't renewable, it says old hydropower isn't new. Duh.

    It ignores Hydro completely except for upgrades to existing facilities.

    where the additional generation in either case does not result in new water diversions or impoundments.

    If you know some brilliant way to extract Hydro without a diversion or impoundment, please share it with us that we might celebrate and bask in your brilliance.

    Posted by: Dishman on September 20, 2013 06:53 PM
    28. "It ignores Hydro completely except for upgrades to existing facilities."

    Adam agrees with the first clause in your sentence; the second, not so much. Maybe you can get him to update his post, so that it's not as misleading.

    As Bruce also pointed out, the stated purpose of I-937 is to develop new sources of energy. Thus, it exudes established sources. Any complaint about this is a complaint about the law working as written, not a complaint that it's not working as intended. It's not really much of a surprise that the people who opposed the law when we voted for it still oppose it now; the only question is why should we listen to them, when the law is working per design?

    Posted by: tensor on September 20, 2013 08:15 PM