Another Legislative Session Goes into the History Books

Although the legislation session officially ended on June 29, 2009, it didn’t really end for CUB until August 7. CUB was pushing for several vetoes, and the Governor did not make a decision on the bills until last week. Now that all action on bills from 2009 is done (for now), we can give members and supporters a complete report.

CUB entered the 2009 session in high spirits from gains in the 2007 session and with the ambitious goals to retain past successes and to move policy forward in four main categories: 1) Climate, 2) Energy Efficiency, 3) Renewable Energy, and 4) Telecommunications. We succeeded in meeting goals in each category, with particular gains in energy efficiency legislation and defeating bad telecom legislation.

However, this past legislative session was a hard one for renewable energy policy. Despite tireless work during the session by a wide range of allies, CUB had to join with other allies to request vetoes for three anti-renewable energy bills. We believed these bills threatened Oregon’s position as a leader in the national push for clean energy and proactive climate change policy. But, overall, CUB was able to deliver several pro-consumer bills.

Climate

Victories:

SB 38
Greenhouse Gas Emissions Reporting: SB 38 expands the ability of the Oregon Department of Environmental Quality to track greenhouse gas emissions from sources outside the state but that account for significant in-state use. The primary emissions sources covered by the bill are utilities that may generate or purchase generated power outside the state for in-state use to meet their loads.

SB 101
Emissions Performance Standard: This bill requires that all new power generation sources have emissions that are equal to or better than the most modern natural gas plant. In general, the bill ensures that new coal plants that do not sequester their carbon emissions will not be built to serve Oregon load. It was the subject of significant negotiations between both public and private utilities, CUB, and the NW Energy Coalition, and this legislation ended up being a consensus bill.

Loss:

SB 80
Cap-and-Trade Authorization: The centerpiece of the climate agenda had many lives. It was clear relatively early in the session that a regional-cap-and-trade bill did not have adequate support to pass. However, a serious effort was undertaken to create a “planning and scoping” process to determine how to create a state interagency coordinating council which would direct four main agencies to create plans to meet the state’s statutory goals for greenhouse gas emissions reduction. This effort made significant headway but ultimately, industry demands would have watered down the bill to until it was nothing but a showpiece, doing little to reduce greenhouse gas emissions.

Energy Efficiency

Victories:

HB 2626 and HB 2180
HB 2626 (Energy Efficiency and Sustainable Technology Act) was introduced to provide a series of pilot projects intended to deliver increased energy efficiency services to residential customers and businesses. By making financing available to implement efficiency projects, particularly encouraging the use of utility on-bill financing as a payback mechanism for the upfront loans, a strong source was found to fund the efficiency work. HB 2180 was introduced to enable local governments to establish “local improvement districts,” or LIDs, to fund energy efficiency projects in particular areas.

HB 2626 was the subject of significant negotiations by a wide range of parties early in the session. Eventually it became a consensus bill. HB 2180 went through some minor adjustments but faced some bumps in the Ways and Means process. HB 2180 was ultimately folded into HB 2626, which passed with overwhelming majorities.

SB 79
Building Codes and Energy Performance Score: The bill as introduced was designed to do two things. First, it intended to create a system of “reach codes” within the building codes system that would adopt two sets of codes at a time: a new building code that met national efficiency standards and a “reach code” with stricter efficiency requirements that would be the main code in three years’ time. This would create an incentive for building designers and builders to “push the envelope” in terms of adopting efficiency measures earlier than current codes because they would have the certainty about what the code would eventually be. Second, the bill sought to establish a system of providing an “energy performance score” to a residence or commercial building at the time of sale, much like a car has a mileage rating. The intent of the energy performance score was to (1) provide an incentive for sellers to upgrade their buildings and use the added efficiency as a selling point, and/or (2) enable buyers to negotiate on price based on potential efficiency work they might undertake after buying a building.

SB 79 passed with the “reach code” language but not the energy performance score provisions, although there will be a task force that will look at establishing such a system in the future.

Renewable Energy

This was the most disappointing issue area for the session since all of the bills CUB opposed, as mentioned in the introduction, were renewable energy legislation.  The bills were bad enough on their own—though a couple actually had some good ideas—but together they represented a retreat from the substantial renewable energy policy progress made in 2007.  Three bills that retreated on the progress made were passed, but thankfully, the Governor vetoed HB 2940 and HB 2742, which were the worst of the bills.  Although HB 3039 was signed, it was the least troublesome of the bills and CUB will be working in the PUC process to ensure that the bill is enacted in the best way possible.

HB 2940
The bill, as passed, added a significant amount of existing biomass generating resources to the state’s new Renewable Portfolio Standard (RPS). In current law, biomass sources can be used to meet the RPS, but the facility that generates the energy must have been constructed after 1995 in order to qualify for use towards meeting the RPS. HB 2940 allowed up to 100 megawatts of power from biomass facilities built before 1995 to count toward the RPS and allowed up to 11 megawatts of power from municipal solid waste, a resource that is not allowed under the existing standard. Both of these provisions would have substantially reduced the amount of new renewables that would otherwise be required under the standard. The Governor vetoed the bill on August 7.

HB 2472
This bill sought to reduce the amount of money directed through the state’s Business Energy Tax Credit (BETC) for renewable generating facilities over 10 megawatts. This reduction primarily impacts large wind facilities and, ironically, biomass facilities. The reduction makes Oregon largely non-competitive for siting these resources when compared to neighboring states, meaning that Oregon loses the economic benefits associated with the building and ongoing operation of these facilities. The Governor vetoed the bill on August 7.

HB 3039
This bill does have some parts that CUB supported, namely the creation of a pilot solar feed-in tariff, which pays individuals and businesses that install solar generation systems for the energy generated from those systems. However, also included in the bill was a provision to allow renewable energy certificates (RECs) from “utility-scale” solar generating systems to count two-for-one against the RPS. While the overall impact on the standard is likely to be minor, CUB believed that this set a bad policy precedent for the future integrity of the RPS and opposed the bill on that basis.

In its veto request letter, CUB outlined potential steps forward on all of these issues, and we remain committed to working constructively with all stakeholders on the issues raised by the bills.

Telecommunications

Most of CUB’s work in this area was defensive, making sure that telecom companies didn’t pass legislation harmful to consumers. The good news is that no bad telecom legislation passed. CUB’s efforts were focused on two main bills:

HB 2405
Verizon proposed legislation to prevent regulation of Voice-Over Internet Protocol (VOIP)—which isn’t regulated anyway—but also wanted to prevent regulation of any “internet-enabled protocol” service or any “successor technology.” CUB thought this was overly broad language that could endanger regulated basic telephone service and worked with cities, counties and Oregon’s Attorney General John Kroger to defeat the bill.

HB 3036
Qwest and Verizon introduced a bill that would deregulate all telecommunications services, despite the fact that CUB had reached a settlement last year with Qwest to deregulate some competitive services but keep basic telephone service regulated. With all the controversy that HB 2405 (see above) engendered, HB 3036 never even got a hearing.

General Pro-Consumer Legislation

SB 76
SB 76 codified an agreement between the governments of Oregon, California, tribes, PacifiCorp and the U.S. government over the future of dams on the Klamath River. The parties came to an agreement that could lead to the removal of the dams as the best economic decision on behalf of ratepayers rather than re-licensing the dams because that would be more expensive. The agreement provides certainty for the governments, the utility and ratepayers by defining and capping the liability to be borne in the rates of Oregon customers of Pacific Power.

CUB was very concerned about the original language of the bill because it seemed that the bill would require the Oregon Public Utility Commission to put costs into rates without adequate review. CUB felt that would create an extremely dangerous precedent and wanted to make sure that the decision to take any action around the Klamath Dams received the same PUC review that any resource decision would receive. With the changes made to the bill, Pacificorp will have to defend any action it takes in regard to the dams and demonstrate that any decision is prudent and in the best interest of ratepayers before any costs were allowed into rates.

As in all past sessions, CUB’s members helped make a huge difference in supporting good bills and opposing bad ones (particularly HB 2405, Verizon’s bad bill). Oregon’s legislature will be going back into session in February 2010 and CUB will be prepared to again defend residential ratepayer interests and we know our members will be with us again. Thank you for all your help and support.

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