In late February, energy legislation (SB 349) that’s been promised from Senate President Robert Stivers, R-Manchester arrived on the last day for bills to be introduced.
Discussing the measure on the Senate floor last week, supporters emphasized the legislation’s commitment to an “all-of-the-above” energy strategy. It’s a talking point many might buy — unless they read past the bill’s first page.
Truth is that the legislation would lead to unnecessary government overreach into energy policy. And, require Kentuckians to shoulder the costs of financial benefits directed toward a small number of coal companies, several of which don’t even operate in Kentucky.
The Energy Planning and Inventory Commission, or EPIC, would be an 18-member group drawn from Kentucky’s business and energy sectors. There would also be an executive committee, which would wield the commission’s real authority. The authority granted to this new bureaucracy is unprecedented.
For example, if an electric utility plans to retire a power plant that has reached the end of its useful life, the utility is required to provide a one-year notice to EPIC’s executive committee before initiating the regulatory process already required through Kentucky’s Public Service Commission (PSC).
That notice will trigger an expensive, taxpayer-funded report to examine a set of issues that have little to do with the provision of reliable and affordable power and, heretofore, haven’t been necessary for the PSC to do its job. According to the bill, the report “approved by a majority of the members of the executive committee shall be designated as findings of the (whole) commission.”
The five members of the executive committee include the head of the University of Kentucky’s Center for Applied Energy Research and two members selected by the other commission members. A retired utility executive has a spot on the executive committee.
Finally, the fifth member must have the “professional experience … required to serve as chief executive officer or board member” of a coal producer.
This is where the bill’s sponsors start hiding the ball.
If this commission was truly interested in an all-of-the-above approach to electric generation, why not designate a position on the executive committee from the natural gas industry? Someone with expertise in large scale solar installations? Maybe even the nuclear sector?
Kentuckians are being told EPIC is needed to focus on reliable and affordable power. But the legislation doesn’t mandate an executive committee member that speaks for consumers, or someone who understands the complexities of regional grid transmission.
When asked if Joe Craft, CEO of Alliance Coal and GOP mega-donor, was consulted on the legislation, Senate President Stivers said that Craft was one of many “engaged in the discussions.”
While others may have been involved, the legislation was clearly written to favor coal operators like Craft.
Frankfort has always been protective of coal. For decades, that aligned with providing the lowest cost energy option for Kentuckians. But that has changed.
Federal regulations have made — and will continue to make — coal-fired generation more expensive than natural gas.
As much as I’d like to see coal prevail in the ideological war that’s been waged against it, moving forward with an orderly transition to natural gas for baseload power is in Kentucky’s best interest.
A new state bureaucracy isn’t the answer to the attack on coal from Washington D.C. Kentucky’s attention should be focused on winning that battle in the courts. SB 349 does nothing to support that fight.
The legislation was fast-tracked out of the Senate. The House still has an opportunity to stop the General Assembly from picking winners and losers.
Here’s how to start that conversation: “Kentuckians want our coal industry to succeed. However, Kentucky’s ratepayers shouldn’t have to pay excessive energy prices to prop it up.”
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Written by Andrew McNeill, the president of the Kentucky Forum for Rights, Economics, & Education. Cross-posted from the Kentucky Lantern.
