Originally printed at ILSR.org
An advocacy group in Boulder, Colo. has made the case for why utilities, not clients, ought to be accountable for the price of retiring fossil gasoline belongings.
For this episode of the Local Energy Rules podcast, host John Farrell speaks with Leslie Glustrom, an advocate with Clean Energy Action in Boulder. They mentioned Clean Energy Action’s white paper on utility accountability and the way we are able to equitably transition to a clear vitality future for a current episode of ILSR’s Building Local Power podcast, republished right here for Local Energy Rules.
Listen to the complete episode and discover extra assets under — together with a transcript and abstract of the dialog.
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Securitization: One Tool for Early Fossil Fuel Retirement
Leslie Glustrom, a biochemist-turned-clean vitality advocate, was a founding member of Clean Energy Action. She has been volunteering in help of carbon-free, native vitality for 20 years. For her, accelerating the transition to wash vitality means serving to different vitality trade outsiders grapple with advanced ideas – one being securitization.
Farrell compares securitization to refinancing a home. Essentially, it permits utilities to refinance their debt owed on growing old energy crops. When a coal plant is retired earlier than the tip of its helpful life, the rest of that plant’s helpful life have to be paid off. Securitization can decrease the charges on these funds from seven p.c to a few p.c.
Securitization is a less expensive strategy to retire fossil gasoline crops early. However, securitization leaves utility clients on the hook for paying “ratepayer obligation cost bonds.” A big share of the burden will fall on small companies and low-income clients, who’re much less prone to have solar energy or different insulation from utility prices.
The endgame is to have ratepayers repay the utility drawback… I’m simply not totally on board with assuming that price payers ought to repay utility’s errors.
Privatizing the Risks and Not Just the Profits
Glustrom is essential of a Rocky Mountain Institute report on coal plant retirement, which basically assumes that utility clients will bear the burden. Instead, she desires to reframe the dialog. Communities are already burdened by the air pollution and local weather impacts of fossil gasoline crops, so why ought to they carry the monetary burden of retiring them early?
In most companies, if you happen to’re caught carrying the fashions from 5 years in the past and you may’t promote them, that’s your drawback.
The new white paper by Clean Energy Action explores what number of instruments, together with securitization, may be correctly applied to “retire coal crops and fossil gasoline belongings early and extra equitably.”
Like all instruments, there’s a time to make use of it at a time to not use it.
Ultimately, duty for fossil gasoline debt will likely be determined by public utility commissions. Commissions are unlikely to shift duty completely to the utility, however Glustrom hopes they are going to be open to splitting the burden between the utility and ratepayers.
Read John Farrell’s testimony in help of an improved securitization invoice advancing within the Minnesota House.
How Long Have Utilities Known the Costs of Climate Change?
Electric utilities are granted monopolies within the curiosity of customer support, however making investments in fossil gasoline infrastructure has been opposite to the general public curiosity for a while.
Thanks to Eunice Foote, says Glustrom, local weather science has been clear for the reason that 1850s. At that point, utilities had few cost-effective options to coal and gas-fired technology. Now, photo voltaic plus storage is the most affordable strategy to generate electrical energy – and it curbs greenhouse gasoline emissions. At what level ought to utilities have realized that fossil fuels have been a nasty wager?
Read the Energy And Policy Institute report Utilities Knew: Documenting Electric Utilities’ Early…