Renewable standards repeal advances to Kansas Senate

Source: By Andy Marso, The Topeka-Capital Journal • Posted: Monday, March 24, 2014


Committee member says end of federal tax credit a game-changer

A Senate committee passed a bill to repeal the state’s renewable energy standards Thursday after one member said the end of a federal tax credit makes renewables less attractive.

Sen. Forrest Knox, R-Altoona, said the expiration of the Renewable Electricity Production Tax Credit at the end of 2013 could double the cost of renewable energy, adding one more reason to unshackle the state from the Renewable Portfolio Standards passed in 2009.

“Something very big has changed,” Knox said. “The federal production tax credit is no longer there.”

The Senate Utilities Committee passed a bill repealing the state standards by voice vote Thursday, with Sen. Marci Francisco and Sen. Tom Hawk, D-Manhattan, asking that their votes in opposition be recorded.

Francisco, D-Lawrence, said corporations whose cultures include supporting renewable energy are increasingly looking to locate in states that have standards like those in Kansas.

“That’s just a quick way to say, ‘What’s a place that values this, where should I go’ and you look at a map,” Francisco said. “I’d hate to see us lose our spot on that map.”

Under current law Kansas utilities are required to glean 20 percent of their energy from renewable sources by 2020. Several have said they are on track to do so thanks in large part to the state’s wind boom.

But Knox said that boom could bust now that the federal tax credit is gone, leaving utility ratepayers holding the bag for higher energy costs because of the renewable mandate.

Repealing the mandate and determining if wind can thrive without it is the best way to go, Knox said.

“Let’s let business do its thing because business is pretty good,” Knox said. “That’s what we believe in in this country.”

During a hearing on the bill a day earlier, Knox had quizzed a representative from EDP Renewables if the company would still be planning to build a wind farm in his district if the project wouldn’t qualify for the federal credit.

Rorik Peterson, the company’s development project manager, said it was difficult for him to answer the hypothetical because the company financed the project while the credit was still the law of the land.

Peterson did make it clear in written testimony that his company is in favor of Kansas keeping its renewable standards, regardless of the federal situation.

“The presence of an RPS in Kansas is indicative of the state’s commitment to energy security, local and rural economic development, and the interests of its ratepayers,” Peterson said. “SB 433 would undermine all of the benefits wind energy has brought to Kansans, introduce unnecessary regulatory uncertainty, and would expose ratepayers to additional price volatility risk.”