‘Too little, too late’: Renewable energy bill expected to resolve litigation heads to committee
A bill to eventually expand renewable energy use in the First State will be heard in committee Tuesday.
Senate Bill 33 (SB33) would extend Delaware’s Renewable Portfolio Standards through 2035, requiring the one utility regulated under the program to provide 40 percent renewable energy by that point. The current standards end in 2025 with a requirement of 25 percent renewable energy.
The legislation must pass by the end of the month in order to resolve pending litigation between the state Department of Natural Resources and Environmental Control (DNREC) and the Public Service Commission over who can freeze progress toward the 40 percent goal, according to legislative staff. The bill would make freezes automatic based on the market price or availability of renewable energy credits.
Stakeholders from environmental advocates to business lobbyists discussed the proposal Friday at a virtual forum hosted by State Sen. Stephanie Hansen (D-Middletown).
University of Delaware wind energy researcher Jeremy Firestone argued the 40 percent goal is “too little, too late.”
“We are now way behind all of the East Coast states from Virginia to Massachusetts,” Firestone said. “I think as a state we risk a lack of investment in our state more generally if we are seen as laggards in our sustainability movement.”
Hansen, the Senate Environment & Energy Committee chair, says discussions about renewable energy in Delaware will continue.
“Senate Bill 33 is what we need to do this month to get something that’s been negotiated in the past … and that will help settle the dispute that’s arising that has a clock ticking on it,” Hansen said. “We need to do this, but we can do more. This is the floor.”
Currently only Delmarva Power is regulated under the Renewable Portfolio Standards (RPS) program—but municipal utilities are encouraged to meet the same renewable energy goals.
A utility can meet the program’s requirements by generating electricity from renewable sources itself or buying credits from other producers that do. A utility can also meet the requirements by making “alternative compliance payments” if renewable energy credits are unavailable or too expensive. SB33 would set these payments at $25 per megawatt hour deficiency in non-solar renewable energy credits and $150 per megawatt hour deficiency in solar. The temporary freeze on increasing renewable energy requirements would kick in when a utility relies on these alternative compliance payments for at least 15 percent of its non-solar obligations over two years.
Delmarva Power region vice president Glenn Moore told the forum Friday that the current RPS compliance cost to the average consumer, including the Bloom Energy surcharge, is currently around $8 per month. The utility predicts that cost will fall to around $1 by 2035 under the current laws, or $1.56 by 2035 if SB33 succeeds.
SB33 would not change the fact that large industrial energy users can opt out of paying the RPS cost, according to Tom Noyes of DNREC’s Division of Coastal, Climate, and Energy. Delmarva Power’s renewable energy obligation is calculated on the amount of energy the utility provides minus that used by customers that opt out of the RPS cost. This means that when large users opt out, the RPS costs for other customers do not rise, according to Delmarva Power and DNREC.
Correction: A previous version of this story quoted Tom Noyes, a DNREC official, stating that large industrial energy consumers opting out of the RPS cost marginally raises the cost for other consumers. The agency has since clarified that this is incorrect.