October 11, 2018

Benton PUD Commission passes resolution opposing Initiative 1631, The Protect Washington Act

Benton PUD Commission passed a resolution opposing Initiative 1631, the Protect Washington Act that imposes a pollution fee on carbon emissions, including emissions from electricity generated by fossil fuels.
The Initiative will be on the Washington State voter’s ballet in November 2018. If passed, the estimated impact of the Initiative to Benton PUD is $1 million to $2.1 million in 2020.  This added expense will ultimately be passed down to customers through electric rates. 
The Commission opposes the initiative because it would increase costs to Benton PUD customers despite the utility having a 92 percent carbon-free portfolio. The Initiative erodes the principle of “local control” and unnecessarily penalizes reliable natural gas generation with no consideration for electric system reliability. They are also concerned with the complexity and unanswered questions pertaining to the details in this Initiative that could have unintended consequences similar to other ballot initiatives such as Initiative 937.
Initiative 1631 proposes to impose a $15 fee per metric ton on carbon emissions on the State’s largest carbon emitters starting in 2020 with an incremental increase of $2 and adjusted for inflation each year. The fee owed by a large emitter may be assumed by a utility when it purchases electricity from the large emitter. This expense is in addition to the costs of Initiative 937 passed in 2006 (requiring additional renewable resources).  
The Initiative allows a qualifying utility to claim credits for up to one hundred percent of the pollution fees for which it is liable provided that it has developed a clean energy investment plan. However, the plan must meet specific requirements as outlined in the Initiative and approved by the Department of Commerce and newly created 15 member board appointed by the Governor. The board will be made up of people from different interest groups with no designated utility representation. 
According to the Resolution passed by Benton PUD’s Commission, the requirements are extremely onerous and clearly erode the principle of “local control” valued by all public power utilities by requiring utility’s locally-elected Commission to obtain approval from the Department of Commerce which may not represent the values and interests of local citizens. 

Resolution No. 2473 - Opposing Initiative 1631, The Protect Washington Act

Commission Presentation for September 11, 2018