BPA rolls back renewable energy incentives

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The Bonneville Power Administration is dialing back renewable energy incentives in favor of a focus on efficiency.

The Bonneville Power Administration will roll back the discounts it was offering to customer-owned and co-op utilities to promote the development of renewable energy.

The move may require some 50 utilities to dismantle programs currently used to promote development of wind, solar and other types of renewable energy.

It comes amid signals that the program has achieved its objectives, matching or beating goals set by the Northwest Power and Conservation Council's power plans for several years, and what BPA officials describe as clear indicators that renewable energy development is marching ahead regardless of the strength of incentive programs.

BPA’s Conservation Rate Credit program primarily supports conservation programs at customer-owned utilities and co-ops, last year distributing $24 million. Since 1996, the CRC has dedicated a portion of its funding toward programs to promote the development of renewable energy such as wind and solar. It began phasing out the program in 2010, lowering its output from $6 million to $4 million, and has contributed only $2.5 million to incentive programs at utilities this year. It will disappear entirely in 2012.

"We're now increasingly focusing on energy efficiency and conservation," said spokesman Michael Milstein. “This has been an evolution as conservation, for some time, was overshadowed by renewables, but it has become clear that conservation is an important resource in and of itself and can be harder to achieve.”

Efficiency has been front and center for Oregon, with the Northwest Power and Conservation Council last year saying that 85 percent of the region's energy needs could be met through efficiency measures.

Moving forward, Milstein said the CRC will continue to operate and will not decrease spending overall.

But as remaining money in the program is spent, roll-back of renewable incentives will leave some customers of non-regulated utilities without incentive programs to develop renewable energy projects. The most common use of the funding was to motivate purchase of wind power from BPA, followed by solar rebates, and then a variety of other programs.

Todd Munsey, member services director at Douglas Electric, said that utility has already used all of its funds for solar incentives for its 9,600 members this year. The $103,000 Douglas Electric receives from BPA annually has to date been divided among a solar incentive program that offers $500 per kilowatt and other programs that provide incentives for heat pumps, weatherization and energy efficient appliances.

With $40,000 spent in 2011, and the remainder subscribed to other programs, Munsey said Douglas Electric will not offer solar incentives going forward, unless interested members lobby their board to develop a program funded by the utility.

“We espouse local control and our members always have the ability to change policy through the board,” said Munsey, noting several are already floating the idea and may bring a proposal to the board as soon as May 18.

Meanwhile he said BPA's changes, while curtailing spending on renewables, do offer new opportunities in energy conservation. As it spends at the same rate, the CRC will offer increased monies to conservation programs. And while it formerly required utilities to return unspent money, it will no longer do so after Oct. 1. Munsey said the change lessens pressure to spend money quickly, creating opportunity to broaden the utility’s approach to energy conservation.

Lee van der Voo, lvdvoo*at*gmail.com, is a freelance writer for Sustainable Business Oregon.