Why RGF opposes SB 489: Arizona State University says 50% RPS would cause that State’s rates to rise 117%

The Rio Grande Foundation strongly opposes SB 489 and testified against the bill on Saturday.  I have posted the testimony below, but first must explain that the bill is very complicated. Our main concern is with the dramatic increase in the “renewable” mandate to 50% and the prohibition on nuclear power as a component of the push to “zero-carbon” electricity generation.

In my testimony I cited a study from Arizona State University which found that electricity rates would increase dramatically (in Arizona) if the State moved to a 50% standard. One of the authors went so far as to state “If this is such a clever idea, and it was jobs positive, economy positive, and climate positive, they would already be doing it.”

— Professor of Economics Tim James, who is director of research and consulting at the L. William Seidman Research Institute.

Here’s Paul Gessing’s testimony before the Senate Conservation Committee on SB 489 on Saturday, February 23.

A 2016 study produced by the Foundation by Dr. Timothy Considine of the University of Wyoming estimated that from 2011 to 2020, New Mexico’s RPS would cost rate payers an astonishing $2.3 billion above and beyond what they would otherwise pay for electricity.

We stand by this report and note that other sources indicate New Mexico’s electricity prices rose about 30% since the RPS took effect in 2005. This increase is largely- attributable to the RPS because it occurred at a time when the prices of traditional electricity generation sources, like coal and natural gas, have declined.
In 2018 the Seidman Research Institute at Arizona State University studied the average price of electricity for residential customers if Arizona were to adopt a 50% RPS by the year 2030.

If the 50×30 Plan were adopted the Seidman Institute estimates that electricity rates in Arizona will rise 13.57c/KWH to 29.41c/KWH. This represents a 117% increase on current prices. The study further calculates that the average residential customer bill would increase by $1,936 as a result of the estimated rate rise between now and 2030.

In the real world California has been the most aggressive state in the nation in raising its RPS. The Golden State has seen electricity rates increase by between 60 and 80% thanks in part to that State’s adoption of an RPS that is in the process of rising from 30-35%.

If the goal of this legislation is to reduce carbon emissions it makes no sense to preclude the use of zero carbon nuclear as a means of achieving that goal.

If we are wrong and the studies cited above are incorrect in any way we at the Rio Grande Foundation would never oppose a utility’s decision to change generation sources to achieve savings provided by lower-cost energy sources, but quite frankly we don’t think we’re wrong. To that end, we want a firm rate cap placed into law to provide protection to rate payers.

New Mexicans whether they be businesses or seniors on fixed incomes should not bear the burden of this transition to supposedly cheaper and greener electricity.

Image result for san juan generating station


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6 Replies to “Why RGF opposes SB 489: Arizona State University says 50% RPS would cause that State’s rates to rise 117%”

  1. Green New Dealers, which includes our new Governor Lujan-Grisham and all her blue legislators, are now proposing to spend taxpayer dollars weatherizing every building in New Mexico and supplying them with electricity from wind and solar farms. In other words, they propose to decarbonize New Mexico.

    In the last ten years that I have been studying nuclear science and technology, I discovered two things about surviving recent trends to mitigate every iteration of the term climate change. Decarbonize is one of those iterations. First, no nation has decarbonized its electricity supply with only solar and wind. Second, the only successful decarbonization efforts were achieved with nuclear.

    Just look at France and Sweden. In the 1970s and 1980s, they built nuclear plants at the rate required to achieve the alleged climate goals of the Green New Deal. Sweden in 2017 generated a whopping 95% of its total electricity from zero-carbon sources, with 42 and 41 coming from nuclear and hydroelectric power. France generated 88% of its total electricity from zero-carbon sources, with 72% and 10%, respectively, coming from nuclear and hydroelectric power with the remainder from wind.

    Meanwhile, the two poster children for wind and solar — California and Germany — have become models of how not to deal with climate change. Germany spent $580 billion on renewables and its emissions have been flat for a decade. And all of that unreliable solar and wind has made Germany’s electricity the second most expensive in Europe. Emissions in California rose after it closed one nuclear plant and will rise again if it closes another.

    Bottom line? Had California and Germany spent on nuclear what they instead spent on renewables, both places would already have 100% clean power. That leaves us with nuclear power as the only truly scalable, reliable, low-carbon energy source proven capable of eliminating carbon emissions from the power sector. However, this will take 100 years, not 10 years.

    So, Gov. Michelle Lujan-Grisham, you need O&G with their fracking process if you plan to address climate change. More importantly, the state needs to invest in nuclear energy for it’s future electricity and we can start by approving the HI-STORE CISF to store and later manufacture nuclear fuel for the advanced nuclear molten salt reactor (MSR) technology being developed in Canada.

  2. When will more policymakers start facing up to the yawning gap between renewable hype and energy reality? They may be forced to. The blistering summer of 2018 throughout much of the Northern Hemisphere pushed electricity usage to dangerous levels.

    Germany’s vaunted green-energy infrastructure couldn’t keep up, and the country had to rely on its few remaining nuclear reactors to fill the gap. South Korea moved to restart 5 shuttered nuclear power plants back to operation. Japan accelerated a plan to reopen some of the nuclear power plants closed after Fukushima, nearly doubling its nuclear capacity. Taiwan reopened a formerly closed nuclear power plant.

    Anti-nuclear sentiment has been running high in all these and other countries, but their political leaders apparently decided that they would face a stiffer voter backlash if they allowed power blackouts.

    Just this month, the European Commission has confirmed that nuclear will form the backbone of a 2050 carbon-free European power system, together with wind and solar renewables. My only question is why even bother with renewable wind and solar which require natural gas backup? It would be more practical to just switch to plentiful natural gas for the next 30 years while developing it’s new nuclear power fleet.

    The goal for the entire world should to be to transition to lower-carbon power energy first and then to zero carbon by 2100. That could be a realistic time frame if we don’t waste our time and resources on alternative sources that can’t solve the climate change issues.

    Natural gas has 60 percent less CO2 and particulate pollution than the coal plants we’ve been using the last 150 years. Since 1880, surface temperature has risen at an average pace of 0.13°F (0.07°C) every 10 years for a net warming of 1.69°F (0.94°C) through 2016 according to National Oceanic and Atmospheric Administration (NOAA).

    In other words, there is more than enough time to decarbonize the electrical grid while the world may warm less than 0.94°C through the last part of this century. Instead of a ‘Green New Deal’, we should be having a ‘Clean Energy Program’ for global electrification with nuclear energy. By nuclear, I mean the molten chloride salt fast reactors or equivalent that will consume all the unused nuclear fuel rods in storage before mining for new nuclear fuel.

  3. Do these people learn nothing by reading data from Australia, England, Germany, others? Relying on wind and solar in these nations has raised electric costs by nearly THREE times, creating a class of “poverty by utility”, and all are completely rethinking (and abandoning) this foolishness.
    We have been exporting our nuclear technology for decades, a far safer system than these “greenies” realize; it is safe, renewable, and can be powered up and down to meet needs. And gas plants can be built wherever we have gas lines, plugging ion to the existing grid.
    There are now approximately 3,800 coal-fired plants under construction and programmed world-wide. Until we have household storage power systems that can provide a week’s supply of power from something the size of a footlocker, we should spend nothing on wind and solar and apply ALL those subsidies to battery/storage technology. And we can do nothing efficiently with wind and solar until we replace the electrical grid. Efficient wagon design would have been of no use without the power to pull them: history talks.

  4. It is sad that people think that nuclear power is bad, dangerous, etc., when it is not. I highly recommend the book Physics and Technology for Future Presidents, which explains sensible, economical solutions to obtain power cleanly. It is a book for non-scientists and scientists alike. If you don’t have time for the entire book, I recommend reading the Climate Change chapter, which will open your eyes. Most politicians and “journalists”, sadly, never read actual scientific studies or know how to analyze statistics. Too many “solutions” to climate change will not only pollute our planet more, but cost a ridiculous amount of money and resources.

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