A legislative proposal to put Washington state on the path to 100 percent clean energy by 2045 this week cleared the Senate Environment, Energy & Technology Committee after revisions and amendments were made to address system reliability and rate hikes. However, some committee members at the Jan. 25 executive session said the bill is still a “work in progress,” while some panel members stressed the need to ensure system reliability to keep the state’s manufacturing industry intact.
Borne out of Governor Jay Inslee’s green energy proposals, SSB 5116 includes several changes from the initial bill heard during a Jan.17 public hearing that includes:
- Removes requirement for utilities to generate 90 percent clean electricity by 2040, keeping it at 80 percent starting in 2030;
- Electric utilities are to be found in compliance with 2030 standard if the net cost of compliance meet or exceed five percent of the utility’s annual revenue requirement, or causes their rates to increase by more than three percent compared to the three-year average annual rate.
- Removes penalties for utilities out of compliance with 2045 standard, but maintains it as a state policy;
- Sets up a process for suspending requirements or waving penalties if a utility’s system reliability is threatened or would not meet North American Electric Reliability Corporation standards; and
- Allows the governor to waive penalties for non-compliance by declaring a drought
Sponsor Sen. Reuven Carlyle (D-36) told colleagues that the bill is “the most thoughtful and expansive 100 percent clean energy bill in the country.”
However, apprehensions were raised during the executive session by Sen. Doug Ericksen (R-42), who warned against “greenwashing” by shifting industrial activity and the related carbon emissions to other countries. An amendment proposed by Ericksen would have exempted electricity sold to manufacturers and industrial employers from the clean energy standards.
He argued that although state and national greenhouse gas emissions have gone up recently, it’s because of increased manufacturing activity that might otherwise have occurred elsewhere. “When we manufacture more things in America, we create jobs here, we also manufacture things to a higher environmental standard than other countries, and we put out less C02 to manufacture a product. My concern is with the underlying legislation that it would drive manufacturing jobs out of Washington state, which would mean we’re not going to not use the products. We’re going to import those products from foreign countries that have high a higher C02 footprint and much lower environmental standards for manufacturing those particular types of things that we would essentially import.”
Opposed to the amendment was Sen. Guy Palumbo (D-1), who argued that manufacturers already enjoy a preferential business and occupation (B&O) tax rate of .484 percent. “If we do this, we might as well do it for everybody.”
However, Ericksen told colleagues that “without accepting an amendment of this type or being willing to consider protecting manufacturing jobs in Washington state, what you’re really signaling to that industry is you really don’t value those jobs here, and we’re not going to have a stable base load source of electricity for them to be able to continue manufacturing here.”
Another concern raised by Sen. Shelly Short (R-7) is that the state’s population is expected to grow even as the bill seeks to reduce its carbon footprint. Her fear is that current residents “are going to have to do more and be penalized a lot in a way.”
One of the few amendments approved by the committee and introduced by Short calls for an assessment of the bill’s impacts to middle-class families, small business and manufacturers. She said that “we also have to be willing to act on the impacts if the impacts show it to be just too much for the citizens of Washington state to bear.”
The bill has been now referred to the Senate Ways and Means Committee.