Tuesday, December 14, 2010
EDITORIAL >>PSC moves on efficiency
We don’t get many chances to compliment the state Public Service Commission, which regulates Arkansas’ investor-owned utilities and cooperatives, but today we give the commissioners a medium-sized salute.
The last time we took notice of them, the commissioners—two of the three, at least—had bollixed the big Hempstead County coal-fired power plant case by giving a combine headed by Southwestern Electric Power Co. (Swepco) a permit to build the big generating plant in the pristine wilderness of Hempstead County without much proof that it was needed, any regard for its environmental consequences or weighing cleaner sources of power. The commissioners let the project get so far along that even the state’s unanimous appellate courts and a federal judge could not stop it.
But last week, the commission ended a 33-year drought and ordered the electric and gas utilities to take steps to improve efficiency and conservation of power and move the state toward cleaner alternative sources of energy. We say drought because the legislature in 1977, when the nation was reeling under the Arab oil embargo, ordered the PSC to direct the utilities toward conservation and renewable energy sources. The PSC never got around to doing it until now.
The commission established energy-efficiency standards that will help the utilities and their customers save energy and thus save money and the environment. Immediately, Entergy and the other electric-power producers will have to take steps to lower their power sales—by one-fourth of one percent in 2011, by half of one percent in 2012 and three-fourths of one percent in 2013. They can do that in many ways—for example, by helping their customers weatherize their homes and businesses and convert to more efficient appliances and equipment—and the state will remove the disincentives for doing that. Utilities will be able to recover the costs of taking those steps and reducing their sales on the front end without having to resort to rate filing. The incentive for power companies in the past was to build new generating plants because the cost would go into the rate base and the company could get a return on the investment through higher rates.
The commissioners issued a sustainable-energy action guide for the future and 10 separate orders to set the state on a course to take advantage of new energy technology, convert the power grid to natural-gas and electric cars and meet tougher conservation standards.
The cynic in us must point out that the efficiency standards—a quarter of a percentage point reduction in kilowatt sales per year—are well below what many other states have done. California acted 35 years ago and has kept its per-capita power usage flat for 30 years, a period of furious economic and population growth (before the great economic collapse of two years ago). But for Arkansas even this is a giant step—doing anything is a giant step. And it is more than any other Southern state is doing.
All of this may sound a little familiar to people in this neighborhood. Wally Nixon of Jacksonville has pushed for conservation and alternative energy solutions for 35 years, as an attorney for the attorney general and the old Public Service Commission, a consultant for Entergy Corp. and lately for the new and (we hope) reinvigorated Public Service Commission. The big industrial power users tried this fall to force Nixon and the Public Service Commission chairman, Paul Suskie, off the case by contending that they had a conflict of interest, given Nixon’s long work and crusade for efficiency. It’s wrong, you see, to have anyone who is knowledgeable and public spirited influencing the commission’s wisdom.
The big industries like Riceland Foods didn’t want to be told they had to conserve energy. Indeed, the commission last week let them opt out of the mandatory conservation goals, but they must all have a plan and prove that they met it.
The nation now is doing little in the face of the climate and energy crisis. With the help of Arkansas’ delegation—all except Rep. Vic Snyder—Congress last year defeated a comprehensive energy act that was supposed to push the country into renewable and cleaner energy and wean it from the foreign oil cartel. But our little commission stepped up to do a small part in our corner of the globe. It deserves our compliments for a change.
Posted by THE LEADER at 9:47 PM