Florida House passes bill allowing utilities to raise rates for renewable energy

04/27/10 Seán Kinane
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Today, the Florida House passed a bill that may mean more renewable energy in the state. The bill will allow utilities to raise rates by up to $386 million over the next three years for clean energy. That could translate to an additional dollar per month for a typical energy customer.

Susan Glickman is a lobbyist for the environmental group Southern Alliance for Clean Energy.

The Florida House of Representatives passed House Bill 7229, which is known as Economic Incentives for Energy Initiatives. And it is really only a small step toward adding additional renewable energy to the grid. It allows for utilities to get cost recovery for renewable energy projects. And, of course, this is just the House of Representatives, and the bill needs to go through the Senate as well, so we don’t have a law just yet. But according to current law, utilities can’t develop projects that go above a cost they refer to as avoided costs, or the cost to build the next new power plant. So it’s a limiting policy for utilities if they want to pay a little bit more money for renewable energy. So this allows them to go above avoided cost.

It’s a very small step; the clean-energy advocates such as myself were advocating for a target for renewable energy, which is known as a renewable portfolio standard. But the Florida House was unwilling to take the bigger step toward that policy, which is the mechanism that has worked to develop renewable energy in thirty states. So it’s—we still have a long way to go in Florida; we’re very behind in developing this market, and a very small step forward happened today in the House with the passage of this bill.

Q. And now it moves on to the Senate; do you think it’ll pass there?

I think that the Legislature wants to do something—in part, large part, because of the difficult economic times that we’re in. Everyone’s very sensitive to costs, and being very price-conscious. So I anticipate that the Legislature will do something. The bills over in the Senate look very different than the bill that came out of the House, so they’re going to have to have some kind of agreement. But I think it is highly likely that we’ll have a bill. It is my hope that the Senate will strengthen what the House has done.

There is an imperative when you’re trying to build a market for renewable energy, in creating certainty for the market, because that’s what attracts the manufacturers. And as I said before, this bill will allow utilities to develop some renewable-energy projects that they wouldn’t have before. But this does not create that certainty in the marketplace that’s really going to drive a big, robust renewable market for the state of Florida. So there’s more that could be done, and I hope the Senate will strengthen the bill before it comes to final passage.

More WMNF coverage of renewable energy:

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