Agriculture Commissioner Adam Putman outlined an energy plan Thursday designed to diversify the states energy portfolio, advance renewable energy production, encourage home-grown technologies and promote greater energy efficiency.
The plan calls for establishing a climate that encourages new energy industries and the creation of jobs without specifically targeting an emerging technology for the government to back.
Saying we ought to have Betamax even though everybody is buying VHS, I think that is the kind of thing that happens when government tries to pick the future, Putnam said.
More importantly, he believes the Legislature can do something it hasnt done in a number of years: approve an energy policy.
Putnam called his plan balanced and comprehensive and entirely within the realm of possibility this session.
The plan calls for:
- Removing regulatory barriers that prevent the expansion of renewable energy opportunities in the state.
- Reviving the business credits and incentives that expired last year in Florida, that were put in place before the industry was mature enough to take advantage of them.
- Requiring the Public Service Commission to consider fuel diversity when making decisions about new power sources. Investor-owned utilities would be required to set aside 1 percent of their overall generation capacity to renewable investments.
The subcommittee is expected to hold a workshop in the next few weeks to discuss Putnams proposals before any legislation is submitted.
Subcommittee Chairman Rep. Scott Plakon, R-Longwood, declined to comment on individual aspects of Putnams proposal, but said he supports the majority of the plan.
The commissioner and I have spoken about the pieces of all of these. The large majority of it we agree on, but in terms of any slight difference, I wont get into those, Plakon said.
It will be out of this committee in time to get something done before the end of session, he added. Were not going to lose it for time.
Subcommittee member Rep. Alan Williams, D-Tallahassee, said he wants to delve into the details but is encouraged that the Legislature will craft an energy policy for the first time in his four years on the subcommittee.
The sooner the better will be great, Williams said. I hope to move in some direction on some of these policies.
In December, Putnam noted that Florida needs to be less reliant on natural gas for its energy, especially when the majority of that source of power comes through just two pipelines from the Gulf Coast.
He said the plan should be particularly beneficial for rural counties that are looking for growth without altering their character.
Usually, rural economic development is parachuting some factor in the middle of nowhere and everybody is happy to have a job and the town is never the same again, Putnam said. With these, youre taking what the community is already good at, which is agricultural production or having open space that allows for algae and solar arrays and all the other things that can go on out there.Now youre necessarily losing all your kids to the city or another state.
Putnams energy recommendations:
Infrastructure investment:
Proposal 1: Reinstate the following sales tax incentives at the recommended caps and clearly define eligible cost. Reinstatement of these tax incentives will promote the development of renewable energy infrastructure, which would give Florida an advantage over other states when investors are looking to build plants.
- Renewable energy technologies sales tax exemption: $1 million per year.
- Renewable energy technologies investment tax credit: Increase current cap of $6.5 million to $10 million per year.
- Renewable energy production tax credit: Remains the same at $0.01 for each kilowatt-hour of energy produced and sold with a cap of $5 million per year.
In order to avoid misinterpretations of which entities are eligible for tax credits, clarify that an electric utility refers to those utilities that sell electricity on a retail basis.
Reporting requirements:
Proposal 2: Require the Department of Agriculture and Consumer Services (DACS) to develop a comprehensive, statewide forest inventory analysis identifying where available biomass is located and ensuring forest sustainability.
Proposal 3: Require the utilities, which file 10-year site plans with the Public Service Commission (PSC), to report the amount of renewable energy resources produced, purchased and proposed in Florida over the 10-year planning horizon and how it will impact present and future capacity and energy needs.
Power plant (over 75 MW) Need Determination process:
Proposal 4: Require the PSC to take into account the need to diversify Floridas energy generation fuel supply during a Need Determination proceeding. By placing value on fuel diversity, opportunities for alternative sources of energy improve, strengthening Floridas energy security.
Public interest determination for renewable energy projects:
Proposal 5: Require the PSC to establish criteria for evaluating proposed renewable energy facilities or negotiated renewable energy power-purchase agreements and establish reporting criteria. The requirement would create a consistent framework by which the PSC would evaluate renewable proposals and determine whether they are in the public interest, establish what information utilities must provide, and what criteria renewable projects will be evaluated against. Given this new framework, remove the current law that requires the PSC to adopt rules for a renewable portfolio standard.
Based on the criteria established in Proposal 5, require the PSC to set an investor-owned utility limit of 1 percent or 75 MW, whichever is less, of its overall generation capacity portfolio in any one year of approved renewable energy investments where those investment costs are above the least cost alternative.Placing a cap on the overall effect on the utilities generation portfolio will avoid unreasonable rate impacts on customers.
Proposal 6: Allow a utility to invest in a PSC-approved financing project with renewable energy facilities in Florida. Currently, this type of utility financing project is allowed with government solid-waste facilities, but not with private renewable energy facilities. A joint utility and private renewable energy financing project would allow the utility to recover its expenses and a reasonable profit. This would promote investment by utilities in renewable energy facilities, when such a contract is determined by the PSC to be in the public interest.
Energy efficiency:
Proposal 7: Require all buildings in the state building fleet, 5,000 square feet or more of conditioned space, to report their energy consumption, and require the Department of Management Services to go to rule-making in coordination with DACS to establish standard and uniform benchmarking and reporting requirements. Currently this reporting is not standardized across state agencies, making the reporting incomplete and inaccurate.
Proposal 8: The Legislature should direct DACS Office of Energy in coordination with the Florida Energy Systems Consortium to evaluate methods to promote energy conservation and efficiency. Further, it should provide the consumer clear guidance on energy efficiency savings. The report should be completed by March 1, 2013, and presented to the governor and the Legislature. Also, the Legislature should require the PSC to evaluate how the Florida Energy Efficiency and Conservation Act (FEECA) statutes provide conservation and efficiency programs that are in the public interest and without undue burden on the customer.
Removing barriers to future investments:
Proposal 9: Clarify that electric vehicle charging stations are a service to the public and not the retail sale of electricity. This ensures that government entities or businesses installing and providing this service are not subject to the undue burden of regulatory fees that may be instituted by the PSC if they were to be considered retailers of electricity.
- Would direct the Florida Building Commission in coordination with DACS and the PSC to adopt rules to standardize the building and electric codes, permitting, and installation of the charging stations.
- Also would direct DACS to adopt rules to address definitions, method of sale, labeling requirements and price posting requirements to allow for consistency for consumers and the industry.
- The PSC is also instructed to conduct a study of the effects of the charging stations on energy consumption in the state as well as the effects on the grid.
Proposal 10: Require DACS in consultation with the University of Florida/Institute for Food and Agriculture Sciences to determine whether a plant material is exempt from the regulatory permitting process based on scientific evidence and practical experience. This would streamline the permitting process for feedstock crops for biofuels.
Proposal 11: Task the PSC to evaluate its current interconnection and net metering rules.
Reach Jim Turner at jturner@sunshinestatenews.com or at (772) 215-9889.
