Last week, the Massachusetts House of Representatives passed H.4738, An Act to Increase Renewable Energy and Reduce High Cost Peak Hours. House leaders were likely expecting a different reception than they received. Climate advocates and organizers, including myself, tore into the bill as completely insufficient. Some, including members of the legislature, are likely wondering why we reacted the way we did.
In their mind, they gave us what we were asking. In reality, they fell frustratingly short. That frustration needs to be understood, so let's explore first the policy shortcomings of H.4738 and then step back to examine the political context that makes those shortcomings so aggravating.
THE POLICY: Lots of numbers. Simple realities.
H. 4738 is actually relatively straightforward. It raises the renewable portfolio standard (RPS) - the amount of clean energy utility companies have to buy from renewable energy sources - and seeks to reduce costs during peak energy hours by establishing a “Clean Peak standard”. For the uninitiated, the RPS is, in essence, a predictable, consistent demand signal to the energy market. It’s the bat signal to renewable energy companies to invest in Massachusetts. For more context, RPS policies are responsible for 60% of new renewable capacity across the country and Massachusetts accounts for 50% of New England’s energy market. In other words, we shape the region and the RPS is the key tool in our belt when it comes to shaping the region’s energy supply for the better.
Currently, the RPS increases every single year by one-percent; so if the total renewable mandate for utilities is 13% in 2018, it will increase to 14% in 2019. The House bill doubles the RPS to 2% growth per year starting in July 2019 and then pulls it back to 1% starting in 2031. Before we even consider the question of why legislators would slow renewable energy growth, let’s first discuss why the 2% growth vs 3% (what we were advocating for) is important. Here’s a rough comparison of what each RPS timeline would look like:
No change: 25% renewable by 2030; 100% by 2105
House bill: 35% renewable by 2030; 100% by 2095
Our proposal/Senate bill: 50% renewable by 2030; 100% by 2049
Right off the bat, the House bill leaves a gap of 15% renewable energy on the table in 2030 and delays full renewable electricity penetration by an additional 44 years. For a bill hailed as continuing our “worldwide leadership in clean energy,” that sounds bad, but it looks even worse when compared against the states that are actually leading. Consider the RPS timetables for our competitors:
Vermont: 75% RPS by 2032
Hawaii: 30% by 2020, 40% by 2030, 70% by 2040, 100% by 2045
California: 50% by 2030
New York: 50% by 2030 (includes hydro)
Oregon: 50% by 2040
Some members of the House, in the rush to mollify their more progressive bases, suggested that their bill might generate significantly more renewable energy than the predicted 35% indicated above. There are multiple problems with this claim (one of which is counting an amendment by Rep. Haddad to study the benefits of procuring an additional 1600mw of offshore wind as an actual procurement, which...it isn’t) but the primary one is that their count includes the Canadian hydroelectricity that has been high on Governor Baker’s wish list since entering office in 2014.
Here’s why that’s a problem. If you care about building an interdependent economy that actually grows our clean energy sector, the term “renewable” doesn’t apply to just any non-fossil fuel. When the environmental community in Massachusetts is talking about renewables, we’re talking about Class One renewables - and large-scale hydro does not qualify as one. Class One renewables are generally the best from an emissions standpoint (usually wind and solar) and must operate within the New England grid operator control area, so they are being built and sited in New England, if not Massachusetts outright.
That has seriously positive economic implications, as Synapse Energy Economics concluded in 2017. A 3% RPS means up to 37,000 new jobs between now and 2030 and a decrease in wholesale electricity prices of up to 8.1%. In contrast, Canadian Hydro, by virtue of not being built and sited in the region, does not have nearly the same impact. That’s before we even consider the impact of such projects on indigenous people. The House’s 2% RPS increase suffers a similar fate, ironically as a result of the legislature’s large wind power procurement in 2016. Had the legislature done nothing on the RPS, renewable supply would’ve outpaced demand in the 2020s and damaged the market. Doubling the RPS rebalances supply and demand but does not “reignite” the bat signal to spur meaningful new development of renewables.
Opponents of RPS expansion, such as National Grid and the Associated Industries of Massachusetts, have consistently talked doom and gloom about price increases under an RPS increase. Here’s the thing about those price increases. Synapse concluded that a 2% RPS only would result in a $0.15 increase in most ratepayers’ bills. A 3% RPS? A little over $2. How often does the chance to create as many as 37,000 green jobs only cost you $2 a month? As someone who starts his commute with a trip to Dunkin every morning, I'd gladly downsize my iced coffee once or twice a month to make that happen.
So just to recap, here are the policy takeaways for the House’s RPS bill:
- Opts for a renewable energy ramp up schedule that pales in comparison to our leadership competitors
- Leaves significant job growth and reduction in wholesale energy prices on the cutting room floor
- Abandoned amendment opportunities to be better via a higher RPS, a ban on the pipeline tax, and codification of environmental justice.
- Embraces a peak reduction policy that has never been tried anywhere else
It’s massive missed opportunity to do serious good for the state and we’re rightfully frustrated. It’s the circumstances under which we missed it that are so infuriating.
THE POLITICAL: Why is leadership standing in the way?
This bill looks disappointing in a void. In our political context, it’s a travesty. If this bill had passed in Alabama or West Virginia, we would be all ecstatic. But we are not Alabama or West Virginia. We have the political capacity to do more and, given the challenge of climate change, we have a moral responsibility to use it. Progressive champions in the legislature offered broadly supported amendments to fix the major issues in the bill- Rep. Khan’s 3% RPS amendment was co-sponsored by a nearly one-third of the entire House- but House leadership rejected each and every one.
We live in the age of Donald Trump, which, beyond wondering if you’ve woken up in The Handmaid’s Tale everyday, means open hostility to renewable energy and a fired up Democratic base looking for ambitious responses. The MA legislature has enjoyed an impenetrable Democratic supermajority for more years than people could count and is heavily siloed by policy issue; it is one of the few legislative bodies in the entire country that risks little politically by choosing progressive solutions and most members don’t pay enough attention to energy policy to disagree with leadership. Moreover, the activist base of this party has explicitly codified a desire be aggressive on renewable energy into its party platform. Consider the following planks of the 2017 Massachusetts party platform:
Massachusetts Democrats Will Fight For:
...Achieving the goals of the Massachusetts Global Warming Solutions Act to reduce emissions by at least 25 percent by 2020, at least 45 percent by 2030, and at least 80 percent by 2050.
...Reducing fossil fuel consumption, divesting taxpayer funds from programs and policies that subsidize fossil fuel production, and opposing efforts to force ratepayers to fund the construction of new gas pipelines.
...Doubling our commitment to renewable energy by increasing the Massachusetts renewable portfolio standard to at least 50 percent by 2030.
So where’s the disconnect? Why is the same legislature that opted to create a working group to safeguard the commonwealth against Donald Trump also opting for weaker policy when stronger policy was available and it would’ve cost them nothing? Regardless of the reason, the question has begun to fester. The angry reaction to the House bill in Chairman Jeff Sanchez’ reliably blue district should serve as a warning to other members: ignore the climate movement at your own risk. The climate activists who donate money and volunteer on to the campaigns of rank-and-file Democrats are sick and tired of being told to accept what is “possible” when the limits of the “possible” are not in line with reality.
We are better than this. Thankfully, we have another opportunity to try in conference committee.
- Andrew Gordon
Legislative Manager, 350 Massachusetts