Legislative Action Alert! Support the Coal to Clean Bill

As the state’s premier advocate for residential ratepayers, CUB supports the passage of Senate Bill 477 (dubbed the Coal to Clean Bill) because in addition to being good for the environment it is also good for ratepayers. On Wednesday, March 25 I gave testimony to the Senate Committee on Environmental and Natural Resources in favor of this bill.

Now I am asking YOU to email your senator and tell her/him to support SB 477, and here is why!

One of the biggest risks that electric customers face today—one of the biggest financial risks specifically—is coal.

As far as I can see, coal has a target on its back. It is obviously a large source of carbon pollution and a significant source of air and water pollution. Because of this, coal plants are now and increasingly will be required to invest in expensive upgrades for pollution control. The cost to Oregon utilities for these coal retrofits has already exceeded $2 billion—with another $1 billion coming between now and 2030. And even after all this money is spent on coal upgrades, customers are still at risk because carbon regulation will likely make the plants uneconomic.

This is the reason that a decade ago, CUB opposed PacifiCorp’s proposals to invest in three additional coal plants and it is why a few years ago we worked with PGE to find a way to phase out the Boardman coal plant, rather than invest $500 million in new plant upgrades.

SB 477 follows the same principles as the Boardman deal: phase out the burning of coal on a timetable that makes it affordable, avoids investing millions in environmental retrofits, and most importantly, protects customers from the future financial risk associated with coal and carbon.

So here are six really good reasons why your Senator should support SB 477, the Coal to Clean Bill:

1. SB 477 is fair: It gives Oregon utilities ten years to plan for phasing out their coal use in Oregon.
2. SB 477 is flexible for utilities: The bill includes a clean energy standard for replacement power, but it exempts any coal plants that have an agreement to close by 2030. This provides a great deal of flexibility for the utilities and an incentive to close plants. And for a multistate utility such as PacifiCorp, it allows replacement power to be decided through the Integrated Resource Plan (IRP) process with all states in the service territory.
3. SB 477 is flexible for regulators: Because we do not know what market or hydro conditions will be in the region at the time of implementation, the Public Utility Commission has the authority to phase the bill in over five years in order to protect customers from higher rates.
4. SB 477 holds utilities accountable: If a utility fails to develop a plan to close one of its plants by 2030, then it must discontinue using that plant to serve Oregon customers in 2025, and instead it must replace it with power that is 90% cleaner than coal. However, the utility is allowed to make substitute market purchases to phase in the clean energy investment over a period of 7 to 12 years. Again, giving the utility some flexibility while still holding them accountable.
5. SB 477 protects ratepayers: When doing utility planning, it is wise to assume that in the next 20 years some additional carbon regulation from the EPA is likely. In fact, in their last IRP, PacifiCorp’s base case assumed that there would be a price on carbon (or carbon regulation instituting a price on carbon – also called a “carbon tax”) of $16 per ton beginning in 2022. Some critics of this bill suggest a carbon tax rather than coal reduction should be the focus of our efforts. As an economist, I know that price signals are one (and probably eventually an unescapable) solution to reduce the use of coal…but it will also push the price of electricity up substantially and harm customers.
6. SB 477 is pro-active: Because we are entering an era of carbon regulations, it makes sense for Oregon lawmakers to be proactive and pass this bill that will flexibly, over time, phase out the use of coal for Oregonians’ power needs. Then, when the inevitable federal mandates require a carbon tax, we will be ahead of the game and Oregon ratepayers will be more able to afford these costs.

So, now that you know what SB 477 does and why CUB supports this Coal to Clean Bill, please write or call your Senator! It is time to make YOUR voice heard because YOUR Voice Matters!

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