Oregon lawmakers this week approved a bill (S.B. 1457) to increase the state’s renewable portfolio standard from the current target of 25% by 2025 to 50% by 2040, and to terminate Oregon’s import of out-of-state coal-based power by 2030. Governor Kate Brown is expected to sign the bill (PV Magazine, Mar. 3, 2016).
The targets may seem odd since nearly three-quarters of Oregon’s electricity comes from hydropower and other renewable sources. But nearly all of the state’s hydroelectric dams were built before 1972 and none more recently than 1980, and the bill counts electricity as renewable only if it is “generated by a facility that becomes operational on or after January 1, 1995.” To complicate matters a bit, some electricity from hydropower can count as renewable but only the portion attributable to efficiency upgrades made on or after January 1, 1995.
Proponents claim the bill will cut costs as well as greenhouse gas emissions. However, the bill authorizes utilities to recover “all prudently incurred costs” in the rates charged to consumers. Such costs include “interconnection costs, costs associated with using physical or financial assets to integrate, firm or shape renewable energy sources on a firm annual basis to meet retail electricity needs, above-market costs and other costs associated with transmission and delivery of qualifying [renewable] electricity to retail electricity consumers.”
Oregon’s current average retail electric rate is 8.21¢/KWh—about 16% below the national average. As PV Magazine interprets S.B. 1457, the bill “sets a 4% annual cap on utility rate increases.” In principle, rates could increase by 50% over the next 10 years and double by 2040.