Corporate Welfare for Renewables

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(Host) Commentator John McClaughry thinks that the renewable energy initiative currently before the legislature isn’t what it appears to be.

(McClaughry) For the past year, Vermonters have been the target of a full court press by one particular for-profit industry – renewable energy production. Newspaper readers noted a steady drumbeat of letters to the editor. In October there was a Statehouse conference on "sustainable energy." At this event the sponsoring Vermont Sustainable Energy Coalition presented its list of recommendations urging the government to jump-start the fledgling renewable energy industry.

Now that effort may be about to pay off for its promoters. By a 27-1 vote, the Senate has passed a bill containing much of what the industry has asked for. The bill would do some useful things. It would allow electric customers to arrange to buy electricity generated by wind, solar, hydro, or landfill gas, paying the extra cost out of their own pockets. It authorizes home and farm generators of renewable energy to sell their excess electricity to the utilities through reverse metering. So far so good.

Now comes the beef. The bill requires CVPS and Green Mountain Power and the other utilities to buy a state-specified percentage of their electric energy from the higher-cost renewable energy industry. In other words, the promoters of the bill want the government to give them a guaranteed cut of the electricity action, at ratepayers’ expense. Very nice.

There’s more. The bill appropriates $750,000 to allow the Public Service Department to subsidize the customers of the renewable energy industry. Lieutenant Governor Doug Racine, who was featured at the October conference, even advocated switching budget money from economic development programs to support "sustainable energy."

The campaign for "sustainable and renewable" has some appealing arguments. Energy conservation can provide significant cost savings, as every homeowner and businessperson ought to know. For some consumers ¿ including one just a mile over the ridge from me ¿ solar and wind area a better deal than relying on utility power. But the renewable energy folks insist that the government force utility ratepayers to buy their more expensive electricity. They want the government to take other people’s tax dollars and give them out to selected homeowners, who will then buy the higher cost renewable product.

It’s not uncommon for an industry to demand that the legislature rig deals and hand out subsidies to benefit its member firms. But it is the duty of legislators to resist such special pleadings. Twenty-seven of 28 senators, seemingly transported by the "renewable and sustainable" dream-weaving, flunked that duty. House members need to see the corporate welfare part of this bill for what it really is, and earn a passing grade by saying no.

This is John McClaughry. Thanks for listening.

John McClaughery is president of the Ethan Allen Insitute, a Vermont policy research and education organization.

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