More U.S. States Cooking Up Renewable Energy Incentives

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PETERBOROUGH, N.H. -- Wisconsin Governor Jim Doyle's Task Force on Global Warming has called for implementation of Advanced Renewable Tariffs to encourage the development of the state's renewable energy resources.

The recommendation is contained in a massive new report on how Wisconsin can reduce its emissions of global warming gases. The call for Advanced Renewable Tariffs, or renewable energy payments, is but one of many measures recommended.

However, the recommendation is the first time that an advisory committee to a U.S. governor has formally endorsed the policy common in continental Europe. It follows on the California Energy Commission's proposal of feed-in tariffs (FITs) as a remedy for the failures of the state's Renewable Portfolio Standard (RPS), and premier Gordon Campbell's call for feed-in tariffs in the Canadian province of British Columbia.

The action is another sign of growing acceptance of the policy mechanism that has fueled the rapid growth of Germany and Spain's renewable energy industry.

Implicit in the task force's recommendation is that Wisconsin's Public Service Commission (PSC WI) has the authority to establish feed-in tariffs without specific enabling legislation. The PSC WI has already initiated a proceeding that may explore how to design the program.

Support for inclusion of the recommendation in the Task Force's report came from RENEW Wisconsin and Clean Wisconsin. RENEW Wisconsin was the first non-governmental organization in the U.S. to propose a policy of Advanced Renewable Tariffs when it filed testimony with the Wisconsin PSC in the fall of 2006. At the time, RENEW Wisconsin's Michael Vickerman argued that renewable tariffs should be based on the cost of generation. His filing was a significant departure from the position of most American NGOs involved in renewable energy rate cases, putting RENEW in line with its Canadian and continental European colleagues.

Governor Doyle's task force accepted this reasoning and specifically recommends "that these advanced renewable tariffs should be based upon the specific production costs of each particular generation technology, include a return comparable to the utilities' allowed returns, and be fixed over a period of time that allows for full recovery of capital costs."

Projects developed under Wisconsin's proposed renewable tariff program will be limited to 15 megawatts (MW).

The task force "recognized that Advanced Renewable Tariffs would likely result in increased costs per unit of electrical output compared to utility-scale renewable projects, but that these costs are justified by the economic and environmental advantages from encouraging distributed small-scale generation."

South Carolina Enacts Net Metering

In related news, last month a decision by the South Carolina Public Service Commission (PSC SC) came to fruition as net metering for solar energy began in the state. The ruling came after the commission began hearings on subject in 2005. This new PSC SC ruling applies to all investor-owned utilities including Duke Energy, Progress Energy and South Carolina Electric and Gas, it also makes South Carolina the 43rd state to have a net-metering policy.

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