Despite climate change, renewable energy not 'slam dunk'

Gordon L. Weil

When it comes to climate change and renewable energy, there's some good news, but a lot of bad news.

Most people would probably agree that if we could produce energy without harming the environment and at lower cost than the traditional fuels, we should do it. But we keep running into problems making that virtually impossible. It's no slam dunk.

After the G7 meeting, where he missed the environmental session, President Trump made clear why he opposes measures to deal with climate change. He knows there's a problem, but he has a higher priority than dealing with it.

"I feel the United States has tremendous wealth. The wealth is under its feet." he said. "We can't let that wealth be taken away." Cutting back on fossil fuel use to reduce global warming could undermine America's wealth. The wealth is for today; dealing with climate change is a "dream," left for a later day.

Trump's policy is deeply rooted in the past. He accepts environmental sacrifices as the price to pay for expanding the use of coal, oil and natural gas. This is one of the central elements of his presidency.

Part of that policy continues using the federal tax system to subsidize the oil industry, while cutting back breaks for renewable resources. That's big government at work. Under a conservative approach, the market would pit renewables against fossil fuels in a fair contest.

Another issue involving renewable resources arises in Maine. Central Maine Power proposes the "New England Clean Energy Connect." This transmission line is supposed to carry hydro power from Quebec to the Massachusetts market. Curiously, some of its supporters have opposed more hydro development in Maine.

By contributing to the reduced use of fossil fuels elsewhere, the project may have environmental merit. But the project, using its Maine corridor, also imposes environmental costs, which have not been fully evaluated. The decision thus far has simply been that its claimed benefits are enough to justify it.

In part, support for the corridor is an obvious reaction to Maine's loss of the major off-shore wind generation project proposed by Norway's Statoil, which then successfully moved it to Scotland. It was blocked by Gov. LePage. Now Gov. Mills has said of the new proposal, "We can't say no to every single project."

Maine is a national leader in environmental protection. But its position may be degraded if it looks like it is reducing its concern or can be induced to endorse a project by dubious payments from CMP's parent, which can expect large, ratepayer-funded profits extending far into the future.

CMP will be able to raise its rates at ratepayer expense over the next 40 years, while its annual payments to Maine are fixed and will lose almost all their value over that period.

Let's be realistic. Trump's view prevails while he is president, and oil industry subsidies are unlikely ever to disappear. Mills does not want Maine to be seen as opposing major private-sector projects, especially the first one of her administration, and the corridor could have some environmental benefits.

Besides, middle income people are not gaining in the American economy and renewables raise utility rates – or at least that's what people think. Even the thin CMP payments might help a little.

But look at Los Angeles. Its electric utility, a public power entity, has a large-scale, 25-year contract for solar power, including storage batteries to ensure reliability. According to press reports, customers would pay 3.3 cents per kilowatt-hour, less than half what Mainers now pay.

The city leadership hasn't yet approved the contract. A major labor union opposes it, arguing it will cost 400 jobs. It rejects statements by city officials that none will be laid off. Union leaders make the false claim that solar is unreliable, despite the batteries.

The Industrial Revolution itself was fought by this kind of objection. Of course, the utility should pursue a policy that does not displace workers. It should work with the union. But change should not be blocked by a backward-looking energy policy, wherever it occurs.

The common thread of Trump's policy, the Maine transmission corridor and even the L.A. solar project is that they are big. Politicians like to land big fish. And if a policy involves transmission, federal policy makes the rewards so great that big-scale projects are avidly pursued.

Yet the future is likely to depend on smaller, decentralized generators, closer to the customers served, probably renewable, less costly and more reliable.

This future requires policies going beyond fossil fuels, but also wisely evaluating big renewable projects.