The Senate easily passed a bill Tuesday that would require utilities to move aggressively into renewable
power, adding momentum to Gov. Ted Kulongoski's effort to make the state a leader in clean energy
development.
Under Senate Bill 838, wind, solar, geothermal and other types of renewable power must account for 25
percent of an electric utility's retail sales by 2025. Intermediate requirements set the standard at 5 percent
by 2011, climbing gradually until 2025.
State Sen. Brad Avakian, D-Bethany, called the bill a "landmark effort" to reduce Oregon's dependence on
electricity produced from fossil fuels such as coal and natural gas.
"It's an ambitious standard, but Oregon is an ambitious state," said Avakian, chairman of the committee that
pounded out the bill's details.
Pacific Power and Portland General Electric, which together account for 70 percent of the electricity
consumed in the state, say reaching the 25 percent goal would be difficult. Still, they have supported the bill.
"We think we can get to 15 percent by 2015 and have it be cost-effective," said Scott Bolton, a Pacific
Power lobbyist. "Twenty-five percent? That seems hard."
The vote, 20-10, was split primarily along party lines. Democrats, with an 18 to 11 Senate majority (there's
one independent) claimed the bill would fuel clean energy development in urban and rural parts of the state
without jeopardizing Oregon's reputation as a state with relatively low-cost power.
Republicans warned that the mandates would force rate increases for households and businesses and
cause big energy users, such as semiconductor makers and pulp and paper producers, to lay off workers.
The bill now goes to the House where Democrats hold a narrower majority, and a tougher fight is expected.
Business groups such as Industrial Customers of Northwest Utilities have been lobbying hard against the
bill's passage.
Tuesday's vote underscored the support the bill currently enjoys, and Democrats, including second-term
Gov. Ted Kulongoski, were confident of success.
The bill is the centerpiece of Kulongoski's energy agenda. Other proposals working their way through the
Legislature include tax breaks for renewable energy and ethanol and biodiesel development.
More than 20 states have renewable energy standards, although details vary widely. Supporters of SB 838
said Oregon needs mandates of its own to snag its share of renewable energy development and regain its
position as an environmental leader.
Critics say Oregon's plan is stricter than most other states and would force utilities to buy mostly wind
power. Other renewable resources, such as solar and wave power, haven't yet honed the technologies that
would make them cost-competitive, they said.
"I call it the 'no windmill left behind' bill," said Dave Nelson, R-Pendleton, who, on a clear day, can look out
from his eastern Oregon property and see wind turbines on the horizon.
The windy Columbia gorge corridor has become a hotbed of wind farm development, and many rural
counties see SB 838 as a way to stimulate faltering local economies. But Nelson frowned at the prospect.
"Do I want them in my backyard? No. They're ugly," he said. "They're 260 feet tall, and they go 'woof, woof,'
" as the blades turn.
Currently, Oregon gets about 1 percent of its power from wind. The rest comes mostly from hydro, coal and
natural gas.
Pacific Power, owned by Iowa's MidAmerican Energy Holdings Co., and publicly traded PGE were part of a
working group that helped craft the bill's details. Critics have accused the utilities of adding provisions that
would allow automatic rate increases to cover the extra costs tied to renewable energy purchases.
"We're really, really alarmed by the huge change this would bring about to rate-making," said Melinda
Davison, an attorney with Industrial Customers of Northwest Utilities. "I've never seen anything this
far-reaching."
Avakian has countered that consumer protections and a cost cap are part of the bill and that the Oregon
Public Utility Commission would maintain its authority to regulate rates.
The bill's treatment of hydropower provided another flash point. Only renewable resources acquired after
1995 count toward meeting the mandates, a provision that excludes the huge dams fed by the Columbia
and Snake rivers.
Critics pounced on the exclusion. "We should be proud of our heritage," said Sen. Roger Beyer, R-Molalla,
who called hydro "probably the most renewable power there is."
Avakian countered that the "hydro issue is a red herring." The point of SB 838 is to look to the future, not
the past, he said.
"It's a visionary type bill," Avakian said. "Oregon needs to look forward again. And this does it in a big way."
Gail Kinsey Hill: 503-221-8590
