Governor Kitzhaberís draft Ten Year
Oregonians should carefully evaluate Governor
Kitzhaberís recently released draft Ten Year Energy
Plan. The draft Plan aggressively mandates energy
conservation, further development of green renewable
energy and the rapid phasing out of the use of fossil
The draft Plan calls for no-net increase in statewide
energy use for the next decade. The goal is stated:
ďMaximum energy efficiency and conservation to meet 100%
of new electrical load growthĒ. At best, the draft Plan
appears to cap future energy availability at current
levels. At worst, it will actually reduce energy
availability in the likely event that conservation
methods are inadequate to compensate for increased
demand. Neither the methods to be used for efficiency
and conservation nor their inherent costs are fully
described or quantified. Further, the increased
competitive costs that always occur when energy demands
exceed energy supplies do not appear to be addressed.
Oregon has the most aggressive Renewable Portfolio
Standard in the nation. Oregon law articulates the
aspirational goals of reducing fossil fuel usage by 30
percent by 2020 and by at least 80 percent by 2050.
Actions taken in the attempt to achieve the Standard are
already forcing the change from reliable low-cost
hydropower and coal generation to much higher-cost wind
and solar renewables. The draft Plan appears to dismiss
low-cost, reliable and relatively clean electrical
generation from abundant natural gas primarily because
natural gas is a fossil fuel.
The huge investments and increased production costs
required to meet energy policies adopted in the past few
years have already driven energy prices sharply higher
in Oregon. Those aspirational policies include the
Renewable Portfolio Standard, programs to significantly
reduce greenhouse gas emissions including the banning of
coal fired electrical generation in Oregon and
establishing strict industrial emission performance
standards, sharply increasing funding for energy
efficiency programs, enacting the Solar Initiative that
requires substantial investment in large-scale solar
generation and even a pilot Solar feed-in tariff
program. PacifiCorpís nearly 60 percent increase in
residential, commercial, industrial and irrigation rates
since 2005 is a salient example of the cost of these
policy changes. Those average annual rate increases were
nearly triple the rate of inflation during the same time
The governorís draft Plan, if adopted, will force the
rapid implementation of these ďaspirationalĒ policies.
The certain result can only be further significant rate
increases. Unfortunately, Oregonís business and
manufacturing interests were not adequately involved in
the consultation and formulation of the draft Plan.
Arguably for that reason, the expected sharp increases
in energy costs that will result from implementation of
the draft Plan were not adequately addressed
The entire Plan appears to aspire to reduce greenhouse
gas emissions in Oregon. However, we need to understand
that the emission of greenhouse gases is a global
function. Oregonís population is about 3.8 million
people. It makes up about 1.2 percent of the 310 million
population of the United States and only about five
one-thousandths of one percent (.00005) of the global
population of about seven billion. The fact of the
matter is that implementation of the Governorís policy
aspirations would not make a measurable difference in
global greenhouse gas accumulations even if Oregonians
discontinued the use of all fossil fuels, totally
stopped emissions of all greenhouse gases, and totally
stopped using all forms of energy from any source.
Regardless of our perceptions regarding alleged
anthropogenic effects on global temperature changes, the
global atmospheric concentration of greenhouse gases
cannot be measurably changed by implementation of any
action or plan by Oregon policy makers.
Oregon continues to be mired in a five year economic
recession. Unemployment and underemployment are
untenably high and rising. Our per capita income
continues its fifteen year slide relative to incomes in
other states and the nation as a whole. I believe that a
great deal of that economic malaise is the direct result
of transformative changes in our stateís energy policies
made between 2005 and 2010. In my opinion,
implementation of the Governorís draft Plan will
certainly add further stress to our already anemic rate
of private sector job creation and family earning
capacity. Moreover, Oregon poorest families, including
those who are unemployed or underemployed, will be
disproportionately disadvantaged by the higher energy
costs inherent to the draft Plan.
The draft Plan appears to ask Oregonians to ďtake a leap
of faithĒ and simply assume that its implementation will
result in the best economic and environmental outcomes
for our state. A decadal decision of this economic
magnitude must not be made based on emotion. We must
demand a complete and thorough examination of both the
costs of existing Oregon energy policies as well as the
actual measurable environmental benefits that have
resulted from those policies before we consider
accepting even more stringent and costly regulation.
believe that any long term energy Plan for Oregon must
be first and foremost a blueprint for achieving
plentiful, affordable and accessible energy for all
Oregonians. The Planís primary focus should be on
helping to make Oregon businesses more competitive. The
creation and maintenance of Oregon family wage jobs is
dependent upon competitive production costs.
The Plan must recognize that energy production and
markets are regional and cannot be isolated by singular
state actions without creating severe economic
disadvantages. It must break down and remove existing
state government barriers to low-cost energy production.
The Plan must encourage free market solutions in energy
production and distribution rather than creating
inflexible and costly government mandates.
Finally, energy users must be charged only the fair
costs of energy production and distribution. It is both
unfair to ratepayers and counterproductive to our
economy to tax energy users through their utility rates
to achieve broader public policy.
From my perspective, the Governor draft Plan will result
in more limited, more costly and less assessable energy.
This in turn will lead to a higher cost less competitive
business environment that will be able to create and
sustain fewer family wage jobs.
That is not the future that I envision for Oregon.
Please remember, if we do not stand up for rural Oregon
no one will.