by Jon Sanders
Director of the Center for Food, Power, and Life, Research Editor | John Locke Foundation
After contentious debate Wednesday, the Affordable and Reliable Energy Act passed a House Commerce subcommittee on a narrow vote, 11-10. In its original version, Rep. Mike Hager’s bill, slated to be heard in four separate committees, would effectively freeze the state’s renewable energy portfolio standards (RPS) mandate imposed in 2007 by SB 3 (see my study on that here).
I continue to find the new corporate-welfare case for the RPS mandate to be curious and quite self-defeating. It’s a real balancing act rhetorically to argue that something is a vibrant success and then plead the absolute necessity for it to keep being spoon-fed state subsidies. Besides which, the case at face value is patently ridiculous.
Perhaps their hope is that through audacity alone — as if the RPS mandate was passed to have green cronyism at the flip of the switch! — they could obfuscate that the RPS mandate’s costs are being shouldered by poor captive ratepayers.
I hope legislators are wise enough and responsible enough to see through it. As I wrote earlier this week,
the mandate’s supporters are ringing the jobs bell hard. Theirs is an interesting case to make: that the mandate is (a) creating a solar success story in North Carolina that (b) would collapse in a heap once the subsidies ended. That isn’t an argument for a successful industry any more than perpetual life support is an argument for a successful patient, let alone a strong case for raising rates on poor captive ratepayers.
Meanwhile, Rep. George Cleveland’s H.B. 280, the Public Staff/Duty to Represent the Public Act, would amend the Public Utilities Act to add a portion to the statutory introduction of the Public Staff. The addition would make the Public Staff’s role — to work on behalf of the using and consuming public — more explicit. Here is the addition:
The public staff shall, in all of its duties and responsibilities provided for in this Chapter, act on behalf of the using and consuming public and shall not act on behalf of any other person, group, or entity. The public staff shall not give any advice, guidance, or opinion in any proceeding or other matter before the Commission that is not in the interest of the using and consuming public.
The insertion is in line with Recommendation 3 in my predecessor Daren Bakst’s Spotlight report on the Public Staff, "Consumer Protection Blackout." Bakst’s report gives ample background for the concerns behind Cleveland’s bill. Here is Bakst’s summary (emphasis added):
The Public Staff is an independent government agency whose role is to represent the interests of electricity consumers before the Utilities Commission. However, as recent examples demonstrate, the Public Staff is acting more like an environmental advocate than a consumer advocate. The Public Staff has recommended a major new tax on consumers, possibly as large as $181 million annually. The Public Staff also has expressed support for wind power plants even though it would mean higher costs and an unreliable means of electricity for consumers. The agency needs major reforms so consumer interests are truly protected, including term limits on the executive director of the Public Staff.
Bakst’s recommendations also include adding consumer oversight of the Public Staff, requiring the Public Staff to demonstrate a need for any price increase or price-increasing policy it recommends, and term limits on its executive director.
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