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Slow and Steady Approach to Clean Energy Protects Ratepayers

Posted by Robert Rio on Aug 27, 2018 8:30:00 AM

The energy bill passed in July by the Massachusetts Legislature, signed by Governor Charlie Baker and supported by AIM has been criticized by environmental advocates for not being “aggressive” enough in promoting the use of renewable energy.

WindTurbinesOceanSmallThe new law doubled the requirement for purchasing new renewable power over the next ten years and allowed the procurement of an additional 1600 MW of offshore wind, in addition to the 1600 MW of offshore wind and 1200 MW of hydro power already on tap.

It’s true that AIM urged lawmakers to take a cautious approach on the measure, especially since a sweeping 2016 energy bill that created a host of new initiatives is still being phased in.

But AIM has learned over the years that moving slowly and deliberately often leads to a better environmental and economic outcome than reacting quickly to the latest fad.   

Remember Cape wind? 

Back in 2010 the same environmental advocates and the administration of then-Governor Deval Patrick fell all over themselves supporting the Cape Wind project, even when it became obvious the development was in trouble. AIM recognized Cape Wind for what it was – a no-bid project with sky high prices that would have added hundreds of millions of dollars to 
the electric bills of Massachusetts ratepayers.

The 30 cents-per-kilowatt hour average price of Cape Wind would have become even worse than it seemed at the time because the wholesale cost of electricity has plummeted over the last eight years due to low natural-gas prices. 

Abandoning Cape Wind allowed offshore wind technology (and the law) to catch up to a place where we now have zero carbon-energy at reasonable costs. New offshore wind turbines are expected to produce electricity at less than a third of the cost of Cape Wind.   

AIM and its 4,000 member employers deserve a share of the credit for that cost shift.

It was AIM, not the environmental advocates, that ensured that the 2016 energy bill required all future offshore wind contracts to be transparent and competitively bid, because we knew competition would drive down prices. The bidding process also attracted world-renowned companies because they knew the process would be fair and open.

The 2016 law included two other important provision pushed by AIM. First, any future offshore wind contracts would have to be cheaper than any existing contract, guaranteeing lower prices in the future as technologies and experience levels become better. Second, these contracts would have to be cost-effective to the ratepayers of Massachusetts.

When Thomas Jefferson wrote the first draft of the Declaration of Independence it was widely criticized. Eighty-six changes were eventually made to that first draft, and the final document was shortened by one-fourth.   

 Our country’s founders weren’t against independence – they just wanted to make sure they got it right.

It worked backed then and we think it’s the best approach now.    

Topics: Massachusetts Legislature, Massachusetts economy, Energy

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