Kulongoski pushes for green energyadmin
Bolstered by election results, Gov. Ted Kulongoski says he wants to make Oregon a leader in the development of alternative energy.
He has developed a three-pronged energy plan, which includes combinations of mandates and tax breaks. Bill writers are already drafting proposals for early introduction to the Legislature, which convenes in January The election sustained a Democratic majority in the Senate and, for the first time in 16 years, handed the party an advantage in the House. Regardless, Kulongoski is determined to gather broad bipartisan support, his advisers stress.
He considers his green agenda key to strengthening the state’s economy, especially in struggling rural areas.
Here are the basics of his agenda:
A bill, known as a renewable energy standard, would require utilities, including Portland General Electric Co. and PacifiCorp, to obtain specified amounts of their power supplies from new renewable in the years ahead: 5 percent by 2011 and 25 percent by 2025. At this point, Oregon consumers get about 4 percent of their power from renewables. At least 19 states have renewable energy standards. Neighboring California has one. In unofficial election returns, Washington voters passed one Tuesday.
The proposal would establish fuel blending standards for biodiesel and ethanol. It would require raw materials used in the fuels to be grown or produced in the Northwest.
The package would include property tax breaks for the plants that make the biofuel blends, and it would offer income tax credits for producers and collectors of biofuel raw materials and for consumers who use biofuel.
ENERGY TAX CREDITS
Incentives would increase the business energy tax credit for companies that install renewable energy systems such as wind turbines and solar photovoltaic arrays. The credit percentage would rise to 50 percent from the current 35 percent. Limits on a project’s cost would increase to $20 million from $10 million.
Another component would increase residential tax credits for wind generation and fuel cells to $6,000 from $1,500, matching the maximum available for solar electric systems. The proposal also would allow the residential credit to be used for more than one qualifying system — a solar water heater and a solar electric system, for example.
“If these pass, Oregon can stand up to any state in the country” in terms of its efforts to develop renewable energy and address global warming, said David Van’t Hof, the governor’s renewable-energy policy adviser. Renewable portfolio standards in California and Washington increase pressures to move quickly, Van’t Hof said.
“The point for us is, do we want to be on the tail end and have other states capture the benefits, or do we want to be on the front end?”
Last session, Kulongoski nudged along pieces of his energy agenda. A biofuel bill passed both chambers, only to die in conference committee, the victim of end-of-session maneuvering.
Kulongoski found many rural lawmakers, regardless of party, eager to consider incentives that might aid jobs and businesses in their districts, but he knew he’d get nowhere with a renewable portfolio standard, given Republicans’ aversion to mandates.
In the House, the post-election reality of a slight 31 to 29 Democratic majority hardly creates a majority party juggernaut, the election winners note. But it does give Kulongoski and his crew assurances that key energy bills will hit committee agendas, receive hearings and, more likely than not, proceed to the floor for votes.
“Before we had no idea what the House leadership would do,” said Jeremiah Baumann, environmental advocate for the Oregon State Public Interest Research Group, or OSPIRG. “They could sit on wildly popular bills if they wanted to.”
The renewable portfolio standard promises to draw the most political intrigue. It is expected to be a complex bill, which means that special interests will have room to maneuver for provisions more to their liking.
PGE and PacifiCorp, the state’s largest utilities, say they need more details before they take a position on a renewable requirement. But, PacifiCorp opposed the Washington state initiative, and its parent company, Berkshire Hathaway’s MidAmerican Energy Holding Co., said it prefers market incentives to mandates.
Neither has Associated Oregon Industries, Oregon’s largest business lobby, weighed in on any portfolio requirement, but it would fiercely fight anything thought to increase energy costs, often a critical operating expense.
Copyright 2006 Associated Press. All rights reserved.