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May 14, 2015

A New Bill in Texas Could End Two Wind Energy Mandates

by Andrew Parker | Publications | TexBytes
 

On April 14, a 21-10 vote sent state Senator Troy Fraser’s Senate Bill 931 to the Texas House, calling for the end of the Renewable Portfolio Standard and Texas’ Competitive Renewable Energy Zone (CREZ) initiative. These mandates have been responsible for the growth in wind energy that Texas has seen over the years, but at a price to consumers.

In 2005, the Texas Legislature modified its Renewable Portfolio Standard (RPS) by setting a goal of reaching 10,000 megawatts from renewable sources by 2025. Texas’ CREZ initiative was put in place to spark wind energy investment and help reach this goal, which is why from 2007 to 2013, wind’s share of energy generated in Texas increased from 2.9 percent to 9.9 percent. Transmission companies spent $6.9 billion to build these CREZ lines in Central and West Texas, and this cost is being repaid by Texas consumers in the form of added fees to their electricity bills—essentially ratepayers are subsidizing the expansion.

The RPS 2025 goal was surpassed five years ago, and companies have spent most of the $6.9 billion to build CREZ lines by last December.

SB 931 rightfully sends the message that it is no longer necessary to continue to force Texas consumers to pay for new lines or force power generators to meet renewable energy quotas. However, since the wind energy production goal was met 15 years early, in 2010, could it have possibly reached the 2025 goal without the mandates and ratepayer subsidies?

If the fate of wind energy were left up to the market rather than forced on us by our lawmakers, might it have still reached its goal?

Whether it is correcting a wrong or ending a “mission accomplished” as Senator Fraser stated, ending these mandates through Senate Bill 931 is a good step forward. Too many times we have seen temporary government programs continue unnecessarily after reaching their goals and consequently force citizens to pay more, whether through higher bills or taxes. Interestingly enough, Senator Fraser championed these two mandates a decade ago, so he should be commended for recognizing when it is necessary for them to end, and acting on it. We will see how the House proceeds.


 

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