Governor seeks rewriting of energy bill

Agency seeks removal of manufacturers from Busch-sponsored measure

General Assembly

March 03, 2004|By Michael Dresser | Michael Dresser,SUN STAFF

The Ehrlich administration called yesterday for a radical rewriting of a bill sponsored by House Speaker Michael E. Busch that would encourage greater use of "clean" energy sources, contending that it could raise rates in its current form.

Michael T. Richard, director of the Maryland Energy Administration, said the administration wants to see manufacturers exempted from the bill's requirements -- a provision environmentalists oppose.

"We must be careful not to do harm to our manufacturing jobs," Richard said.

Richard appeared before the House Economic Matters Committee as a supporter of the legislation, but his testimony largely supported the arguments of industry groups fighting the bill.

Richard's appearance came after Busch, who has made the bill a priority of the Democratic House leadership, told fellow lawmakers the legislation would bring long-term benefits to the state.

"It's good for our economy. It's good for conservation. It's good for the environment," Busch said.

The legislation seeks to promote the use of renewable energy sources -- including solar, wind and geothermal power -- by requiring utilities to gradually increase the amount of energy they supply from such sources between 2006 and 2019.

In the short-term, it would encourage the use of hydroelectric power and the burning of waste to produce energy, but those incentives would diminish over time in favor of the preferred renewable sources.

Advocates contend that such a measure would help nurture a developing market for renewable energy -- promoting cleaner power sources and lessening the state's dependence on imported fuel. They also say it would promote the development of a wind power industry in rural parts of the state.

"We're giving an incentive for investors to invest what will probably be billions of dollars in the state of Maryland," said House Majority Leader Kumar P. Barve. The Montgomery County Democrat said the legislation would also lessen dependence on a volatile natural gas market that is prone to price spikes.

Proponents of the legislation contend that its cost to ratepayers would be insignificant, but large industrial users were not convinced.

Michael Powell, a lobbyist for the Maryland Industrial Group, told legislators the bill would cost Maryland manufacturing jobs by raising energy costs in a highly competitive market.

Powell said the negotiations between environmentalists and utilities that led to the bill did not include the companies he represents.

"It absolutely is not a consensus bill," he said. "I've never seen six pages of people signed up to testify on a consensus bill."

The lengthy hearings showed there is not even consensus within the ranks of environmentalists and energy producers about the bill.

While most environmental groups supported the bill, the Sierra Club wanted extensive charges because of its concerns about wind turbines killing birds and bats. While Constellation Energy and Potomac Electric Power Co. supported the bill, Wheelabrator Environmental Systems Inc. called for extensive amendments to eliminate what it called a bias against companies that generate energy from solid waste.

Del. Dereck E. Davis, chairman of the Economic Matters Committee, reminded people on all sides that the legislation was a work in progress and that negotiations are continuing.

Some environmentalists took comfort in the fact that the administration did not outright oppose the proposed regulatory scheme, known as a Renewable Portfolio Standard.

Richard said the proposed structure has worked in other states but would have to be tailored to fit Maryland's needs. He said the administration wants to play a role in any negotiations.

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