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Bozeman Daily Chronicle
by: Jeff L. Fox
January 2, 2016

Renewables Riding Momentum into 2016

The worldwide move toward cleaner energy continued to gain momentum in 2015. Actions at the state, national and international level are all sending an undeniable message that the rise of clean energy is here to stay.

As usual, states are leading on clean energy. In May, Hawaii became the first state in the nation to require that all electricity be sourced from renewable resources by 2045. In June, Vermont set its renewable energy requirement at 75 percent by 2032. Perhaps of most economic significance, California, the world’s eighth largest economy, upped its renewable energy requirement to 50 percent by 2030. State leadership on clean energy is likely to continue into 2016 as well, as Oregon and Washington are expected to debate legislative bills this winter designed to reduce their consumer’s reliance on coal energy, increase renewable energy consumption, or make meaningful progress on cutting carbon emissions. And both states appear set to bring policies before the voters as ballot initiatives if their elected representatives fail to accomplish the task.

Of course states weren’t the only ones leading in 2015. This December in Paris, all 196 nations attending the United Nations conference on climate change, including developing countries like China and India, agreed to stem their greenhouse gas emissions this century. With this global agreement, the world is now united around the goal of limiting the worst effects of climate change and deploying clean energy technology to curb emissions.

At the national level, clean energy won another important victory in late December when Congress passed long-term extensions of the wind energy production tax credit (PTC) and the solar energy investment tax credit (ITC). The extensions trade certainty for an eventual phase down of the federal subsides. Under the new policy, the wind energy PTC will gradually phase out by 2020, eliminating federal subsidies to America’s most popular and often cheapest energy resource by 2020. No other major energy resource is on track to be free of federal subsidies by 2020, including coal, nuclear, oil and natural gas.

Meanwhile the 30 percent solar energy ITC has been extended in full through 2019, then it is set to phase down to 10 percent by 2022 for utility-scale solar developments.

These measured phase-outs of federal subsidies for wind and solar have been celebrated by the renewable energy industry for providing certainty and time to adjust. They have also been made possible by extraordinary cost reductions in wind and solar energy as the industry gained experience and technical know-how. Over the last six years wind energy has achieved 61 percent cost reductions and solar energy prices have dropped by a whopping 82 percent over the same time period, with further cost reductions expected. Today wind and solar energy often outcompetes natural gas as a low cost energy resource.

With wind energy set to stand on its own and the federal subsidy for solar energy set to be dramatically reduced, now is the time for Congress to remove the long-standing subsidies for energy sources like coal, oil, natural gas, and other long established energy industries.

Unfortunately, utility-scale renewable energy development largely stalled in 2015 for Montana. Aside from a few community solar projects, Montana didn’t add any utility-scale energy generation of any kind in 2015. We did, however, witness the decommissioning of the 46-year-old Corette coal plant near Billings. Looking ahead, it isn’t a political statement to observe that Montana’s coal plants, including Colstrip, won’t last forever, perhaps not much past 2030. The same forces that are propelling clean energy forward are the ones weighing aging coal plants down: namely cost, environmental responsibility, and flexibility.

In 2016 there will be a lot of continued discussions (and political posturing) about how to comply with the EPA’s Clean Power Plan, which requires Montana to cut carbon emissions by 47 percent by 2030. While compliance is important, it shouldn’t be the entirety of our state energy policy. We must also work to keep Montana, a historic energy exporter of about 50 percent of the energy we generate, competitive in a market that is rapidly moving away from fossil fuels and toward clean energy resources.

 

Jeff L. Fox is the Montana policy manager for Renewable Northwest, a nonprofit regional advocacy group promoting environmentally responsible renewable-energy resources.

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