by Gar Smith
On January 1, 30 million US households were given the opportunity to chose their electric power supplier. But, despite the flurry of feel-good advertising from self-styled "green power" providers, the new "deregulated" power that will flow into home electric outlets in 1998 will still be the same old mix of electrons from nuclear, coal, gas, hydro and solar sources.
The only significant difference is that instead of writing a check to a traditional mega-utility, homeowners now have the option of writing a check to a new, smaller company that draws power from the sun or produces windpower on a mountain top.
Meanwhile, in the name of "deregulation," California's biggest power producers - PG&E, Southern California Edison and San Diego Gas & Electric - are being allowed to recover losses on any "stranded assets" (read: "aging nuclear power plants") that are no longer competitive in an open market. Consumer advocate Ralph Nader warns that this "nuclear bail-out" will cost California rate-payers $28.5 billion.
Nader has formed Californians Against Utility Taxes [CUT, 1750 Ocean Park Blvd., No. 200, Santa Monica, CA 90405] to oppose this bail-out fee. The Utility Reform Network [TURN, 711 Van Ness Ave., No. 350, San Francisco, CA 94102, (415) 929-8876] has joined forces with CUT to place an initiative on the 1998 state ballot to invalidate the bail-out tax. The national anti-bail-out campaign is being led by the Critical Mass Energy Project [Public Citizen, 215 Pennsylvania Ave. SE, Washington, DC 20003, (202) 546-4996, higley@citizen.org].
Deregulation Dangers
Environmentalists fear that existing renewable energy programs adopted by the regulated energy providers may founder as these utilities are forced by the pressures of competition to cut costs and provide the cheapest (and often the dirtiest) power.
In California, publicly owned power companies are not protected from the ravages of predatory competition and the Los Angeles Times has warned that the LA Department of Water and Power "may not be able to compete effectively in California's soon-to-be-deregulated electric power market." The LADWP needs all of its customers to service its $7.5 billion debt. If too many customers abandon the LADWP, the debt could crush the utility and, warns the Times, "threaten the financial stability of Los Angeles."
The State of California spent $89 million on a campaign to educate the public about their new energy options but, when the press revealed that the PUC's public education campaign was "funded almost entirely by the state's three biggest private utilities," consumer groups were indignant.
Among the facts that the state's education program failed to bring to the public's attention were the following:
- "Qualifying Facilities" producing "green" energy by burning solid biomass will be allowed to use fossil fuel for as much as 25% of the energy input.
- Electricity suppliers marketing solar power will be permitted, under law, to blend it with gas-fired electricity to make the price more competitive.
Green Labels for Green Power
The Center for Resource Solutions' (CRS) [http://www.crest.org/clients/green-e/] voluntary verification program slaps a "Green-e" label on any energy product that is "based on at least 50 percent renewable energy." (If the remaining 50 percent comes from coal-fired plants or nuclear reactors, the supplier would still be allowed to sport the Green-e seal of approval.)
While "50% renewables is better than what we have now," observes John Schaefer, president of Clean Power Works [PO Box 1225, Santa Cruz, CA 95061, (408) 471-9337], "the cost of 100% renewables isn't that great - perhaps $10 to $20 per month."
The Environmental Defense Fund [257 Park Avenue South, New York, NY 10010, (800) 684-3322] has an excellent Green Energy website [www.nrdc.org/programs/Energy/green_power] with links to green energy suppliers and an Electricity Label Generator that spits out state-by-state data on energy costs, sources and pollution.
The California PUC website [cpus.ca.gov] posts a list of all "Registered Electric Service Providers" but, except for addresses and personnel, the only thing a potential customer can learn is whether any of the company's officers have ever been convicted of a felony.
The Center for Energy Efficiency and Renewable Technologies posts clean energy information on its website [www.ceert.org/pledge,html] while the National Renewable Energy Consumers Council [(800) GO-GREEN] has created a prototype disclosure label for green power providers. An additional source of information is ConsumerNet, the Consumer Research Foundation website [http://consumernet.org/crf/].
The Renewable Energy Policy Project [REPP, 3140 Tydings Hall, University of Maryland, College Park, MD 20742] noted in its January 1997 report, "Truth and Labeling for Electric Power," that not all renewables are equally "green." While burning biomass for fuel releases about as much carbon into the atmosphere as the new biomass crops absorb, "planting, harvesting and transportation of biomass fuels may create net carbon emissions." Geothermal power has been criticized as a nonrenewable resource since it depletes mineral-rich water resources and generates sulfur-laden acid rain.
Looking at the bigger picture, REPP recommends that certification also require that companies be "committed to a plan to develop new [sustainable] capacity" - i.e., to increase the number of wind generators, solar panels, etc.
"The most comprehensive basis for certification would be an analysis of the life-cycle environmental impacts created by the supplier's entire operation," REPP concludes. "Oversight ... will require regular reporting of air emissions and other environmental impacts ... every two or three years."
More Power To You
As of November 17, 192 entities had registered with the PUC to supply power to California residents. Company names ran the gamut from Affluent Target Marketing, Inc. to Thrifty Power Corp. and included such buzzwords as Friendly, New, Green, Preferred, Renew, Clean, People's and Reliance. The companies were based not only in California, but as far away as Maryland, Philadelphia, Georgia, South Carolina and Florida.
A good name is no guarantee of good service. While one might feel more inclined to sign on with a company called "Clean'n Green" than the unfortunately christened "Avista Mock Energy LLC," such matters should not be left to chance.
The key to the new energy marketplace is choice, but the only companies that most potential customers are hearing about are the few large, entrenched energy giants that can afford to flood the airways and clog the newspages with expensive advertising.
Texas-based Enron, which describes itself as "one of the nation's largest wholesale providers of renewable energy," offers Earth Smart Power derived exclusively from "non-nuclear and non-coal sources" and states that "50% will come from renewable sources like wind and solar power." But Enron plans to charge customers a "monthly fee of $7 [to] help cover the costs associated with providing this environmentally friendly energy." (Enron also promises new customers 10 percent of 1998 utility bills but doesn't mention that this rebate is required by law regardless of what energy company one joins.)
Green Mountain Energy Resources offers "cleaner electricity that features sources like water, wind and underground steam." Green Mountain entreats would-be customers to "Choose wisely," but the company has failed to heed its own advice. Customers in Vermont were livid when they learned that the windpower towers prominently featured in Green Mountain advertising only supplied a small portion of the company's energy. The greater portion was purchased from Hydro-Quebec, a Canadian power giant that has laid waste to great stretches of wilderness - damming rivers, flooding native lands and drowning tens of thousands of migrating caribou.
How to Choose
Practically anyone can register to be an energy provider, says the PUC's Andrew Barnsdale, as long as they can demonstrate a history of financial reliability and "good management practices." It is the California Energy Commission (CEC) that is entrusted with certifying and labeling new energy suppliers.
CEC Media Director Claudia Chandler hopes to have a "Bill Advisor" on the CEC website [www.energy.ca.gov] by February that will display the cost of power from different suppliers based on a consumer's location and energy use. At the Journal's suggestion, Chandler said she would attempt to add labeling and certification information to the CEC website so consumers could evaluate not only the cost, but also the eco-friendliness of power providers.
Ultimately, an impartial nonprofit watchdog is needed to monitor green power claims. Beyond that lies a truly empowering vision - utilities run by environmentalists.
An organization like the Sierra Club, with a membership of 500,000, would have a ready-made market that green-power suppliers would be happy to compete for. Greenpeace, a group long-known for daring innovations, might be a good candidate to become the country's first green energy giant. Closer to home, coalitions of small, localized eco-groups could band together to offer clean power to their collective memberships.
Consider the possibilities: They could be positively electrifying.
Green Power: How to Survive Deregulation