As we continue to increase our consumption and demand for power, Utah faces an immense challenge in developing a well-balanced energy policy for the future. Just as the great inventors of our past devised ways to harness the power of electricity, the great minds of our time must now turn their focus toward delivering a cost-effective, balanced and increasing clean stream of power. We must increase the diversity of our sources of electricity while continuing to provide that energy to consumers at costs lower than most states nationally.
Low electricity prices compared with other states is a crucial economic development tool and a benefit to citizens that Utah cannot afford to lose. To ensure we retain this energy advantage, we must address Utah's specific needs, rather than follow what states on the West and East coasts are doing.
Senate Bill 202 crafts a truly innovative approach to achieving these objectives. Similar to other states, it provides powerful incentives for electric utilities to seek generation diversity through the development of cost-effective wind, solar, geothermal and other renewable sources. But it does more. It removes many of the barriers to the development of renewable resources identified by both utilities and independent power producers.
It provides a mechanism for consumers who elect to install renewable energy projects to receive renewable energy certificates and the financial benefits associated with ownership of those certificates. It recognizes that development of renewable resources alone will be insufficient to meet the growing needs of Utah's consumers. It encourages utilities to acquire or develop electric energy from other zero-carbon-emitting sources, including energy efficiency. Finally, it directs Utah's utilities to take these actions while retaining the cost-effective standard for the acquisition of new electric generation.
SB202 was criticized because it does not mandate that utilities use an arbitrary level of renewable power by an arbitrary date. A mandate would dramatically increase energy prices. In contrast to a mandate, SB202 requires utilities to acquire at least 20 percent of the power consumed by Utahns to come from renewable sources by the year 2025, to the extent it is cost-effective to do so.
This cost-effective requirement is better than an arbitrary mandate for two reasons. First, it provides the correct incentive to renewable energy producers to produce competitively priced energy. Second, the cost-effective requirement's flexibility protects consumers from price shocks, should renewable energy continue to be an expensive alternative.
In addition, SB202 realistically anticipates Utah's future energy needs. Utah's explosive growth will need more than just renewable power to keep the lights on. This bill therefore gives state government a sensible role in developing technology to produce clean coal power.
There has seldom been energy legislation in Utah with the broad support enjoyed by this bill. We must deal with the complex issue of diversifying electric resources used to serve Utah's consumers and reducing carbon emissions, while retaining our energy cost advantage. This benefits all sectors of the economy.
Many of the original concepts of the bill were made public in November. Since then, a diverse coalition of stakeholders worked together to develop a holistic approach to addressing Utah's energy challenge. Consumer groups representing electricity users large and small, independent power producers and renewable resource developers who will be offering projects and energy sales to Utah's electric utilities, together with all of Utah's electric utilities, contributed to this legislation.
Energy prices will likely increase as a result of growing consumer demand, the need for new infrastructure and the cost of fuel. Consumers should not, however, carry the added cost burden of poorly developed legislation. SB202 achieves the goals the governor has established for the state's energy future, which are diversity and a reduction in carbon emissions, while retaining Utah's cost-effective standard for the acquisition of new electric generation.
SB202 directs Utah electric utilities to further reduce carbon emissions through continued investment in cost-effective zero-carbon electricity, with a focus on renewable sources. It also removes unnecessary impediments to renewable energy investment and creates new opportunities for electric consumers. This bill, crafted by all the stakeholders of Utah energy policy and development, lays the foundation for the next generation of energy policy in Utah.
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* SEN. CURTIS BRAMBLE, R-Provo, is majority leader of the Utah Senate.
SEN. MIKE DMITRICH, D-Price, is the Senate minority leader.
