It’s no secret that North Dakota has been kicking Montana’s butt economically. But there’s another storyline that doesn’t often get published back here in Montana: North Dakota has been kicking Montana’s butt when it comes to alternative energy production. Odd, you might say, considering the fact that some Montana politicians were thumping their chest after passing down a “green power mandate” known as the Renewable Portfolio Standard. North Dakota has been surpassing Montana in green energy production without a green power mandate. And yet, North Dakota will now see a hike in their power prices thanks to Montana’s green power mandate.
The Plains Daily has this headline “Montana Renewable Energy Mandate Leads To Rate Hike For North Dakotans.”
The subject of a green power mandate is taking center stage in the race for the Montana Public Service Commission.
Incumbent Ken Toole (D-Helena) is facing challenger Bill Gallagher (R-Helena) in the November election for the 5th District seat on the PSC. The Flathead Beacon profiled the race this week, noting the contrast between the two:
Gallagher seeks to make the PSC District 5 race about a pushback against Democratic control of state governing bodies like the Land Board and PSC, where Democrats hold a 4-1 majority. He calls Toole a “career politician” in the sway of environmentalists, who supports conservation and efficiency mandates that could end up raising rates for consumers.
Toole is unrepentant that improving efficiency is economical and obtainable.
“Energy efficiency is the cheapest thing to do to meet our power needs,” Toole said. “I’ve been a long-term advocate of it.”
Meanwhile, as the state’s Renewable Portfolio Standard enters as a leading issue in the PSC race, Dave Skinner offers up some interesting insight in his weekly opinion column.
Then there is the idea, and implications, of renewable energy standards (RES). As you’ll remember, Montana has an RES of 10 percent (increasing to 15 percent in 2015) for public utilities (not electric co-ops). That became law in 2005, passing by one vote in the state Senate, when Sam Kitzenberg (remember him?) switched his vote. The bill’s sponsor? Now-U.S. Sen. Jon Tester.
On Aug. 12, Montana-Dakota Utilities asked the Public Service Commission for a 13 percent rate hike, mainly because of the higher cost of renewable power. The Billings Gazette reports MDU ratepayers, mostly in eastern Montana, will be hit with a 14.5 percent net increase – about $100 per year per household.
Now, why would 10 percent more power cost 14.5 percent more? Oh yeah, renewables cost more. With RES’s set to rise again to 15 percent in 2015, MDU and Northwestern will inevitably be back for what is sure to be more … don’t forget, the first facilities to be built are usually the low-hanging fruit that are easiest and cheapest to bring on line.
Fortunately for the folks in Glasgow, who will be heading to Glendive tonight (as I type) for the Scotties football game, MDU is not their supplier for electricity, so they will not pay the electric increase attributed to former State Senator Sam Kitzenberg’s (D-Glasgow) vote. Just don’t tell that to the folks in Glendive though.
Then again, Northwestern Energy is subject to the Renewable Portfolio Standard as well. So everyone in Glasgow, less than 20 miles from one of the cheapest electric power sources in the country (The Fort Peck Dam), brace yourselves for a rate increase.
The American Tradition Institute teamed up with The Montana Policy Institute, a Bozeman-based conservative think tank, to analyze the impacts of Montana’s renewable portfolio standard.
The results of their study: higher rates and job losses.
Here’s more info following a prepared release from ATI and MPI:
The coming report, prepared by the Beacon Hill Institute in the economics department at Suffolk University in Boston, found that Montanans will likely pay $225 million more for power in 2015 because of the state’s RPS, and it could cost them as much as $348 million more. A recent study ( http://www.bentekenergy.com/WindCoalandGasStudy.aspx ) found that wind power actually increases pollution and greenhouse gas emissions due to these required backup systems.
Other findings from the ATI/MPI report:
• Over the period of 2010 to 2015, the Act will cost Montanans an additional $1.865 billion over conventional power, within a range of $1.102 billion and $2.886 billion.
• Montana’s electricity prices will increase by an average of 1.33 cents per kilowatt hour (kWh), or 18 percent, in 2015, within a range of $0.83 cents per kWh, or 11 percent and 2.06 cents per kWh, or 28 percent.
• By 2015 Montana will lose an average of 1,874 jobs, within a range of between 1,172 jobs under our low cost scenario and 2,893 jobs under our high cost scenario.
• In 2015, the RPS mandate will reduce annual wages by an average of $520 per worker, within a range of between $325 per worker $803 per worker.
• Due to higher home energy costs, in 2015, annual real disposable income will fall by $175 million, within a range of $109 million and $270 million.
Click here for the full report.