All readers of Marketplace probably can agree on this: Any time Republicans and Democrats get together for a discussion, there’s no agreeing. On anything.
Even such seemingly neutral turf as the planet generates ire and controversy by the megawatt. Those close to the topics of environment and industry would tell you that clean-energy legislation is anything but neutral ground.
All readers can probably all agree on this, too: The Clean Energy Jobs Act and the Senate’s amended and scaled-down version, which sprouted from the Governor’s Task Force on Global Warming, hit some raw nerves in Northeast Wisconsin.
It seems cleaning up the earth tends to get knotted up with money and jobs — two tender points for Wisconsinites. That knot is precisely the point at which where supporters and detractors tangle.
Gov. Jim Doyle, who first proposed the idea for the bill a few years ago, recently said the legislation would “bring down consumer costs, create more than 16,000 jobs in the state, and position Wisconsin to continue its leading role in clean energy production.”
“Through CEJA, we will create clean energy that works for Wisconsin and is made in Wisconsin,” he said in an April 14 press release about his Clean Energy Jobs Act.
Clean energy legislation would create new jobs primarily in the construction sector, according to Wisconsin’s Office of Energy Independence, including between 800 and 1,800 construction jobs each year for the next 15 years and 2,000 manufacturing jobs total.
But what is it?
Besides being massively long and somnolence-inducing reading, CEJA’s original 174 pages were scaled down to a 150-page revision, with no less than 25 amendments made along the way during the two weeks it lay exposed on the Assembly and Senate operating table. It never got brought up for a vote before the Legislature’s spring session ended April 22.
CEJA covered more than clean energy and jobs. One group described it as “omnibus,” which is not an exaggeration.
In addition to the two nouns in its title, CEJA affected new subdivisions, truck idling, new government buildings, small wind farms, investment in anaerobic manure digesters, grants to local governments for planning events, brownfields, automobile emissions, nuclear power plants, home and commercial insulation and energy efficiencies, the state Main Street program, allocating existing tax-exempt industrial revenue bonding to clean-energy projects, the energy efficiency of audio and video devices, forestry practices, owners of private forest land, and reserve crops.
The list goes on and, although it doesn’t actually include the bathroom sink, it does encompass one- and two-family houses. And boiler-inspection requirements.
It also would have provided for grants for small-scale green-energy projects, especially manure digesters. The grants would have made small-scale projects accessible to more people in the state, which in turn would have helped tamp down water pollution caused by phosphorus in manure runoff.
CEJA set goals for renewable energy: that by 2025 25 percent of total energy consumed in Wisconsin would come from renewable sources (wind, biomass, etc.).
That 25 percent could “count” efforts to improve energy efficiency, so a true 25 percent of Wisconsin’s energy wouldn’t actually need to come from renewable sources.
It sounds easy enough. But this is where it gets sticky. Todd Stuart, executive director of the Wisconsin Industrial Energy Group, callsthe proposal “a massive capital expansion project” because of the money that would need to be spent to build renewable facilities.
“To put into place the kind of infrastructure means billions,” says Stuart. The costs of a “green infrastructure” was estimated at $15 billion during legislative deliberations.
Stuart and others who oppose clean energy legislation say the bill doesn’t work for Wisconsin: it’s too expensive to install all the systems (such as wind, solar and biomass) to produce renewable energy on any large scale, and even if it weren’t too costly, rates would still increase and consumers (especially business and industry) would get socked in the wallet, they say.
Those like Stuart who oppose CEJA cite the cost of renewable energy and the potential loss of jobs as two reasons for their position. Business and industry would be forced to make cuts or, worse, close down and/or leave Wisconsin, which would leave more people unemployed, Stuart says.
The state also doesn’t need the extra energy, Stuart says. “This state just built brand- new power plants that came on line in the last year or so, and now we have more capacity than we really need,” he says. The amount of energy we will need in 2016 is roughly the same as it was in 2006, he says.
“The utilities built plants to meet the projected need in the future, and nobody would have guessed the economy would fall apart,” says Stuart. “We’ve retrofitted coal plants and invested millions in new power plants — all these are a couple percentage points on your bill. Right now we’ve just gone through a major building cycle and what this bill [would have done] is put another building cycle on top of that.
“Is this wise economic policy? Can the consumer bear it? Or can we coast on the investments we just made?”
Paul Jadin, president of the Green Bay Area Chamber of Commerce, says the bill would have resulted in “double-digit electric rate increases, higher gas prices and more expensive residential and commercial building costs.
“Everyone agrees that energy efficiency and renewable energy are laudable goals, but the bill will harm key sectors of our state’s economy at a time when Wisconsin businesses and homeowners can least afford it,” said Jadin in an e-broadcast. “Rather than joining a national or worldwide effort, these burdens on our struggling businesses and citizens [would have forced] us to go it alone and will make no meaningful impact on global temperatures or greenhouse gas emissions.”
RENEW: “Faulty information”
Those who support clean energy legislation say its detractors base their opinion on bad information from a study that came out last year.
“What is odd is that a handful of legislators would rather believe a conservative think-tank than an independent agency with tools and expertise to evaluate the impact of the legislation on utility rates,” says Ed Blume of RENEW Wisconsin, referring to a Public Service Commission study showing that the legislation would have saved Wisconsin $1.4 billion over 15 years.
Which leads to another sticking point: Whether Wisconsin would spend the $15 billion anyway.
Supporters say yes and that by 2025, that money would be gone and we’d still need to buy fuel.
“The cost of energy is going to rise whether or not the legislation goes through,” says John Shenot, policy advisor for the Public Service Commission of Wisconsin. “The legislation [for renewable energy] would seriously reduce how much demand there is for electricity in this state.”
Fossil fuels cost money, and wind and sun don’t, so you pay a lot upfront for a renewable energy facility to be built — but you don’t have to pay anything more for fuel after the framework is put into place, Shenot says. “For a coal-fired plant, even one built 30 or 50 years ago, you still have to buy fuel. We view it as an investment; to them, it appears in their press releases as a tax.”
Shenot likened it to a homeowner who needs a new furnace.
“The really efficient furnace is $400 more, but overall you are spending less in gas,” he says . “Energy efficiency is different than my property taxes — I will spend a little bit more now so I spend a lot less in the future.”
Another factor those opposing clean energy legislation don’t consider, Shenot says, is how much has already been spent on fossil fuel infrastructure.
“When people only focus on how much renewable costs,” he says, “they overlook the fact that we’ve already spend a lot of money cleaning up our fossil fuel plants.”
Next, the campaigns
While Doyle’s clean energy bill died before legislative approval, the issue is likely to come up in this fall’s gubernatorial and legislative campaigns.
Democratic gubernatorial candidate Tom Barrett vowed that if elected governor he would bring Democrats and Republicans together to create a compromise bill.
Barrett said the state needs to wean its dependence from out-of-state coal and natural gas to generate electricity. He added, however, that he wants assurances that a clean energy bill wouldn’t lead to sharply higher electric rates, or endanger jobs.
One of Barrett’s Republican opponents, Scott Walker, replied to Barrett by saying that Barrett’s “continued support for radical ideas about environmental policy will kill jobs. The global warming policies backed by Mayor Barrett and Governor Doyle will lead to double digit increases in utility bills and worse yet, the loss of thousands of jobs for Wisconsin families.”
The other GOP candidate, Mark Neumann, supports “ending Wisconsin’s dependence on foreign oil,” according to Neumann’s Web site, but opposed Doyle’s bill and opposes “having the government choose, directly or indirectly, one energy solution over another or one type of production over another type. This decision should be made by market actors like producers and consumers who are in a better position to choose than the government.”