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Tuesday, May 3, 2011

Testimony in Opposition to Counting Canadian Hydro Toward RPS

Statement of RENEW Wisconsin in Opposition to SB 81
Senate Judiciary, Utilities, Commerce and Government Operations Committee
May 3, 2011

Good morning, my name is Michael Vickerman. I am here to represent RENEW Wisconsin, a nonprofit advocacy and education organization based in Madison. Incorporated in 1991, RENEW acts as a catalyst to advance a sustainable energy future through public policy and private sector initiatives. We have over 300 total members, and more than 60 businesses around the state, including Biogas Direct (Prairie du Sac), Bubbling Springs Solar (Menomonie), Crave Brothers Farm (Waterloo), Convergence Energy (Lake Geneva), Emerging Energies (Hubertus), Energy Concepts (Hudson), Full Circle Farm (Seymour), Full Spectrum Solar (Madison), GHD, Inc. (Chilton), H&H Solar (Madison), Kettle View Renewable Energy (Random Lake), Michels Wind Energy (Brownsville), North American Hydro (Neshkoro), Northwind Renewable Energy LLC (Stevens Point), Pieper Power (Milwaukee), Organic Valley (LaFarge), Quantum Dairy (Weyauwega), Renewegy (Oshkosh), and Seventh Generation Energy Systems (Madison).

More on North American Hydro later.

On behalf of our members and the many businesses and individuals who support the continued expansion of Wisconsin’s renewable energy marketplace, RENEW Wisconsin is here to express opposition to AB 114/SB 81, and urges the Legislature not to pass this bill. If passed as is, AB 114/SB 81 would allow electric utilities to use generation from hydro facilities larger than 60 megawatts to satisfy their renewable energy requirements under 2005 Act 141. Manitoba Hydro could easily become Wisconsin’s largest supplier of statutorily sanctioned renewable energy in the next decade.

Because no increase to the state’s Renewable Energy Standard is contemplated in this bill, the outwash of kilowatt-hours from Manitoba in the next decade will crowd out opportunities for utility-scale renewable energy development opportunities in Wisconsin. The window was already closing for in-state renewable energy sources before this bill was introduced. According to Platt’s Electric Daily, Wisconsin Power & Light and WPPI Energy have already accumulated enough renewable electrons and credits to meet their 2015 targets. The same is true of Madison Gas & Electric. The Platt’s article also quotes a Wisconsin Public Service Corporation official stating that the utility can meet its 2015 renewable energy requirements with what it has acquired to date until 2020. AB 114/SB 81 would enable those utilities to enter into contracts with Manitoba Hydro to supply them with post-2015 renewable energy, thereby sparing these utilities from ever having to invest another nickel in a Wisconsin renewable energy project again.

Leaving aside We Energies’ proposed biomass plant in Rothschild, which may or may not go forward, We Energies’ Glacier Hills wind project in Columbia County is the only utility-scale renewable energy project under construction right now in Wisconsin. It will be completed this December. None of the other utilities have any plans to build a renewable energy generating facility in Wisconsin in the next five years. Should this legislation pass, we could go 15 to 20 years before seeing another large renewable energy project built in this state, if ever.

True, there are quite a few wind prospects under development in Wisconsin, all of them pursued by independent companies. But as of late, Wisconsin utilities have shown no interest in entering into a contract with them. And if AB 114/SB 81 is adopted without an increase in the state’s Renewable Energy Standard, Wisconsin utilities will have no reason to buy wind projects or their output, because the utilities can get whatever they need from Manitoba Hydro.

For the record, RENEW supported the Clean Energy Jobs Act introduced last year and the compromise on large-scale hydro in that legislation. That bill would have increased the utilities’ renewable energy requirements along with classifying large hydro as an eligible renewable energy resource. In it there was room for both in-state renewable energy development and electricity purchases from Manitoba Hydro. However, as a stand-alone measure, AB 114/SB 81 would make room for Manitoba Hydro at the expense of local renewable energy businesses. If passed, this bill would effectively turn Wisconsin into a renewable energy backwater for the next 20 years.

In the absence of legislation to increase the state’s renewable energy standard, AB 114/SB 81 is best described as the “Outsource Renewable Energy to Canada Act.”

About North American Hydro, this company owns 25 hydro generating units in Wisconsin and employs about 70 people. Both the company and its employees pay taxes in Wisconsin and spend the income they earn in their respective communities. That won’t happen when renewable energy production is outsourced to Canada.

Let me close by asking a few rhetorical questions.
  • How does the elimination of in-state renewable energy development revitalize the state economy and create new jobs?
  • How does importing vast quantities of hydropower from another jurisdiction promote energy self-sufficiency and resilience in this state?
  • How does purchasing vast quantities of hydropower from another country improve the country’s balance of payments?
  • Where will our children and young people go to find renewable energy employment opportunities if we decide that foreign hydro should become Wisconsin’s default energy resource option.
Respectfully submitted,
Michael Vickerman,
Executive Director

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