Some Real Alternatives to the APCo Fuel Cost Mess

APCo has gotten themselves (and WV rate payers) in a mess.  They want to try a new financing scheme, HB4530, to bail them out.  The mess was caused by rising fuel costs.

As long as electric power generation depends on burning something, electric rate payers will be paying for fuel.  The other thing we know about fuel is that world supply gets smaller and smaller every year, and demand for fuel rises every year around the world.  From these two trends, we can safely conclude that the price of fuels used to produce electricity will continue to rise, as they have been doing for decades now.

There are three ways of “producing” electricity that don’t involve burning fuel.

  1. We can increase the efficiency of our use of electricity.  That is, we can invest in equipment and systems that produce more “work” for the same amount of electricity.
  2. We can conserve electricity more effectively by simply being wiser about how we use power.
  3. We can eliminate the need for fuel altogether by investing in solar power and wind power.

Items 1 and 2 above don’t involve producing any new electricity at all.  Electrical engineers who have studied efficiency savings have concluded that 13% of our current electrical use can be eliminated easily from our current systems just through the easiest efficiency improvements.  Conservation is different from efficiency, because it simply means using less electricity by installing automatic switches on electrical lighting and equipment.  Conservation can be as simple as getting in the habit of waiting to use your washing machine until you have a full load, or turning off lights in rooms you are not using.

Investing in efficiency and renewable power, such as solar panels or wind turbines, does not require any fuel costs.  All of the investment in these systems, however, comes as an initial payment for installation of equipment that will last 30 years or more.  It is that initial investment that is the big hurdle for government regulators and politicians.

As we have seen, our WV PSC and our WV Legislature are more willing to lock WV rate payers in to rising fuel costs than they are to support real investments in efficiency and renewable power generation that will eliminate fuel costs altogether.

Why is it that the WV Legislature is rushing to force rate payers to borrow money to pay for coal that has already been burned?   Why won’t the legislators and the WV PSC consider using a feed in tariff system or state bonding authority to support WV owned and installed renewable power systems that would eliminate the need for fuel cost adjustments forever?

I personally don’t have a dog in the fight over the APCo bailout bill.  I am a Mon Power customer.  Mon Power, just as dependent on coal as APCo is, managed to do just fine during the 2008 coal price bubble, and avoided APCo’s big boo boo.

I hold the WV Legislature and the WV PSC accountable for failing on the larger question of diversifying WV’s sources of electricity.  Back in 2009, the Legislature had the opportunity to pass a renewable energy credit system which would have helped WV citizens and businesses make the initial investment in solar power generating systems.  This bill would also have created dozens of new businesses in the state, created new jobs and increased property tax revenues for schools and counties.  Instead, then Governor Joe Manchin and the Legislature passed a bill that shut new solar power investors out of any benefits and locked up the “alternative energy credit” system exclusively for coal burning power companies.  So the WV Legislature and now Senator Manchin are directly responsible for failing to resove problems that have led to the current APCo coal mess.

The Legislature has a chance during this legislative session to move our state in the right direction, toward a more stable energy future.  Legislators can pass the following bills that are before them right now:

  • SB 162/HB 4646 to create a least cost plan reporting system at the PSC
  • HB 4363 requiring the PSC to set energy efficiency targets for power companies in WV
  • HB 2740 the Solar Bill of Rights to limit local restrictions on installing solar panels

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