Deregulation Means a Clean Power Option for Many Americans
The news that electricity deregulation will give consumers a choice for the first time in determining their power supplier is just starting to filter through the information network. For environmentalists looking to purchase “green power” generated by renewable resources, the initial information is confusing at best, because the rules and options vary widely. But if you're in the right part of the country—specifically California, Pennsylvania, New Jersey and New England—it may already be time to make a change.
Consider that, according to the Worldwatch Institute, electric power generation produces more pollution than any other human activity. In the U.S., it accounts for two-thirds of the country's acid rain-causing sulfur dioxide emissions, and more than a third of the carbon dioxide that causes global warming. The dirtiest power is coal-generated, and coal is still in common use because it's such a cheap fuel. Pennsylvania, for instance, gets 98 percent of its grid from nuclear, oil and coal. According to the Natural Resources Defense Council, particulate air pollution kills more than 5,000 people a year in that state.
California was the first state to deregulate its electricity, and the reviews have been mixed. It was assumed by some free market enthusiasts that there would be a mad rush last year to purchase the cheapest power possible when power marketers descended upon the state to entice residents to switch electric companies. But only one percent of the eligible California customer base, representing 11 percent of electricity consumed, switched to any alternative supplier during the first year.
Nevertheless, a promising sign for environmentalists is that over half of the residential customers in California who have switched chose green power. In Pennsylvania, the news is better: 450,000 consumers, or 12 percent of those eligible, have signed on to the Electric Choice program (although not all of that is renewable).
Critics such as Nancy Rader, an analyst for Public Citizen, complain that green power is failing to attract customers because it's too expensive. Since she released her report last fall, however, residents of California consumers have been able to buy green power for less money than dirty power, and now have the option of paying a $12 a month premium to buy 25 percent of their electricity from new wind turbines.
One of the key obstacles to the success of green power in deregulated markets is assuring consumers, both large and small, that their dollars are, indeed, flowing to renewable power plants. The electricity grid is, after all, a mix of all generated power, from nuclear to solar. The San Francisco-based Center for Resource Solutions (CRS) developed a Green-e verification program modeled after the recycling logo on paper products to insure that when consumers elect to purchase power marketed as “green,” they know the product and the company meet certain minimum content standards and abide by good business practices. Customers get, in writing, a document that tells them the price of power and the fuel sources used.
“By choosing products with the Green-e logo, residential customers will purchase at least four times more renewable energy than the generic mix they would otherwise buy,” said CRS executive director Jan Hamrin.
Should We Worry?
As with the deregulation of the phone industry, consumers tend to stick with the company they know until given a good reason to change. With green power, they worry that a switch will mean waiting for equipment installers, and being left in the lurch when there's a power failure. But as Green-e points out, the electric lines “will still be owned and operated by local monopoly utilities. If the lights go out, you'll need to call the same folks you do now.” No special equipment is needed.
There are, of course, various shades of green. Working Assets Green Power, a pilot project put together in Massachusetts and New Hampshire by the California-based progressive phone and credit supplier, offered consumers a mix of hydroelectric, oil- and natural gas-generated electricity, but did not set up its own power plants. Boston's Sun Power Electric, in contrast, has built three solar facilities to serve consumers in the Northeast.
Implementation of deregulation programs varies widely. Rhode Island opened up its electricity market in 1998, for instance, while Maine consumers will have to wait until July of this year. Up-to-date information is available mostly on the Internet. The best web site for those consumers looking to get general information about green power programs all across the country was put together by the federal Department of Energy (www.eren.doe.gov/greenpower). Probably the best and most thorough green power shopping guide is the Center for Resource Solutions site (www.green-e.org). The Natural Resources Defense Council (www.nrdc.org) has also done some work screening green power products.
If you discover that you don't have a choice in power supply, check the state regulations, then contact your local utility and demand some answers.
PETER ASMUS is author of the forthcoming Island Press book Reaping the Wind.