Trump vows to bring back coal but GOP governors bet on clean energy
by Allen Best
If you have been having a drab, cheerless day, you should go listen to former Colorado Gov. Bill Ritter Jr. With a professional home called the Center for the New Energy Economy nestled within Colorado State University, Ritter speaks often about the great energy transition underway in the United States.
It’s a happy story of movement at the state and local level, but in the private sector, too. It’s also strikingly different than the talk in Washington D.C., as Ritter has stressed in several recent speeches in metropolitan Denver, including his March 15 appearance at the annual conference of the Colorado Solar Energy Industries Association.
As governor from 2007 to 2011, Ritter pushed the expansion of renewable energy in Colorado and oversaw the first major overhaul of rules that seek to minimize adverse consequences of drilling for natural gas. In his more recent career, he meets privately with many other governors in the West and their aides in an effort to advance the transformation to a cleaner energy economy.
In Washington D.C., new Environmental Protection Agency administrator Scott Pruitt has questioned the basic science of global warming. But in state and local governments, there is clear movement toward energy transformations. The trends are too big for one president to reverse, said Ritter.
The coal industry is under siege. Last year, three of the largest coal producers in Wyoming were in bankruptcy and had lost 98 percent of their shareholder value over a four-year period. Five utilities decided to shut down a major power complex in 2019, even though it has a useful life to 2045. Coal is being displaced not so much by solar as by cheap, plentiful —and cleaner-burning—natural gas.
Then there’s the Governors’ Accord for a Clean Energy Future, a consortium of 17 states that in February 2016 agreed on a vision of diversified energy generation and expanded clean energy, clean transportation options, and the need to modernize energy infrastructure to “manage electricity flexibly and efficiently.”
The states include a number of Republican governors, among them Nev. Gov. Brian Sandoval. Nevada, said Ritter, has decided it will not have another coal-fired power plant because “the are too many other opportunities.”
“This is happening at the state level. That’s where the transition is happening, and utilities are understanding they have to be part of it,” he said.
But cities are also been adopting climate action plans that call for reduced greenhouse gas emissions. Utilities must respond to these municipal plans. Denver has such a plan, and Xcel Energy has a franchise agreement with the city. Cities, including Austin and San Antonio, the two largest in Texas to do so, have also been banding together to create markets for clean energy.
Large companies have also been driving demand for clean energy development. Microsoft, for example, bought 500 megawatts of wind generation in Wyoming and Kansas. In Nevada, some of the major casinos and their principals, including the chief executive of MGM Grand, have been pushing for policies that expand clean energy options.
Then there are right-of-center advocates of clean energy, including the Conservative Energy Network. They have exerted pressure in Michigan, North Carolina, Ohio, and Kansas, too. Some of the more conservative elements are driven by the economic incentives of clean energy, but others also see climate change as an existential threat, said Ritter.
“What this makes me believe is that no matter what happens at the federal level for the time being, there are opportunities,” said Ritter.
There are questions, including what role natural gas will play in the future. Ritter said he rejects those who want to shut down natural gas extraction in the United States. They are “not living in the kind of reality that is the utility sector of America,” he said. In other words, we haven’t figured out the alternatives yet.
But renewables have a bright future. Utility scale solar costs have dropped 85 percent in the last five years. They are now competitive with the cost of combined cycle natural gas electricity—without subsidies. Rooftop solar has dropped 55 percent in the last five years. Solar in 2016 added more generating capacity than any other single source.
And now comes Tesla and Solar City, with their plans for solar generation in Hawaii, which has traditionally had the highest priced electricity in the nation, at about 40 cents a kilowatt hour. Much of the electricity is produced by burning oil and diesel, which must be imported to the islands. The new electricity from renewable sources will come in at 13.9 cents a kilowatt-hour.
Ritter said the solar industry will continue to grow, but as it does there will be consolidation. Great opportunity exists for solar production in rural America, where irrigation for farms gulps great quantities of electricity. Electrical co-ops should see this as an opportunity. He called out the successes of United Power, which serves a portion of northern Colorado from a headquarters in Brighton.
The investment tax credit expires in 2020 and the production tax credit expires in 2022, and Ritter said they may not be renewed. Renewables have become competitive, and with wind in Texas selling for less than 3 cents a kilowatt-hour, it’s hard to make the case that the nascent industry needs subsidies. “The industry is maturing in a significant way,” he added.