Senate passes sweeping energy legislation Block Island's Sen. Sosnowski a sponsor By Abby Fox Last week, the state Senate passed four bills establishing a new energy strategy for Rhode Island. They provide for an Office of Energy Resources, mandate power companies to diversify their energy supply, and increase assistance programs for low-income residents.

The bills were sponsored by Block Island's Sen. Sue Sosnowski (D-South Kingstown, Block Island) and Sen. William Walaska (D-Warwick), along with Senate President Joseph Montalbano, and others.

"These bills will help craft real, long-term solutions to energy issues in our state," Sosnowski said at a press conference in March, when she and Walaska introduced the legislation. "In an era of rising costs and increasing volatility in the energy industry, we believe these bills will help ensure adequate energy supply, will improve conservation and use of renewable energy sources and will truly help those who need assistance."

The bills came out of a one-day State Energy Summit held at the State House in November 2005, co-chaired by Walaska and Sosnowski.

The other impetus behind these bills is to enable Rhode Island to meet its target of having 16 percent of its energy supply come from renewable sources by 2019. Gov. Donald Carcieri has his own goal of 15 percent in five years, an Associated Press story reported over the weekend.

The first big bill, the "Gas and Electric System Reliability and Least-Cost Pricing Act of 2006," was the one that the Block Island Power Company tried, but failed, to be exempted from. (See sidebar below.) That bill encourages the diversification of energy resources that gas and electric utilities rely on, and provides for least-cost procurement for gas and electric supply.

It's a hefty measure, beefing up both the Public Utililies Commission's responsibility and the responsibility of individual utilities. The law would go into effect July 1, 2007, and extend through the year 2020.

The bill's introduction explains its intention: "That prices of energy, including especially fossil-fuels and electricity, are rising faster than the cost of living and are subject to sharp fluctuations, which conditions create hardships for many households, institutions, organizations, and businesses in the state," it reads. "...the state's economy and the health and general welfare of the people of Rhode Island benefit when energy supplies are reliable and least-cost; and...it is a necessary move beyond basic utility restructuring in order to secure for Rhode Island, to the maximum extent reasonably feasible, the benefits of reasonable and stable rates, least-cost procurement, and system reliability that includes energy resource diversification, distributed generation, and load management."

As a result of this bill, the Public Utilities Commission would have until June 1, 2008, to establish standards for "system reliability;" for the "procurement of energy supply from diverse sources," such as renewable energy sources; and for conservation programs.

And every electric company would have to submit to the commission by Sept. 1, 2008, and every three years after that until 2017, "a plan for system reliability and energy efficiency and conservation procurement." By March 1, 2009, and every year after that, they'll have to submit a supply procurement plan.

The legislation also establishes an eight-member energy-oversight commission, four appointed from the House of Representatives, and four appointed from the Senate. This commission will study programs of assistance to low-income households and monitor the establishment and development of the Office of Energy Resources, while also looking into the many other procurement and conservation issues mentioned above.

The commission would expire on March 31, 2009.

Office of Energy Resources

Another bill, called the "Rhode Island Energy Resources Act," creates the Office of Energy Resources, replacing the State Energy Office.

The office needed a change, Sosnowski said, because it "was only formed by executive order and never had a place in Rhode Island General Law. Now it will be in the statute, which raises the importance of the energy office."

The Office of Energy Resources would have to: "Develop and put into effect plans and programs to promote, encourage, and assist the provision of energy resources for Rhode Island... monitor, forecast, and report on energy use, energy prices, and energy demand and supply forecasts, and make findings and recommendations"; and develop "plans and programs to promote, encourage and assist the efficient and productive use of energy resources in Rhode Island..."

As Sen. Walaska explained, "While other states have well-defined responsibilities for energy matters within the executive branch, Rhode Island does not... Rhode Island needs a strong, well-defined, proactive approach to energy issues and this act will remedy that deficiency in state government."

The bill also establishes a seven-member Energy Resources Council to advise the Office of Energy Resources. One member would represent a large commercial and industrial energy user; two would represent residential users; one, an energy policy advocacy groups knowledgeable in energy conservation programs; one would be someone who works in renewable energy development; and one an architect or engineer.

Finding renewable energy locations

Another of the energy bills, "The Renewable Energy Implementation Act of 2006," authorizes the State Properties Committee to work with the Office of Energy Resources on guidelines for "locating renewable energy facilities" around the state: on "commercial, industrial, institutional, agricultural and state properties."

Many towns in Rhode Island are "overloaded with the business of the day, and not long-range policy and planning issues," Sosnowski said. "It will aid all the towns when they go forward."

Assistance programs

The fourth bill, called the Affordable Energy Act, will expand energy assistance programs for low-income households.

Every gas and electric company in Rhode Island would have to submit to the Public Utilities Commission "a plan for affordable energy for low-income households, including very low income households," by Jan. 2, 2007. (Low-income households are defined as those at or below 125 percent of federal poverty guidelines.)

Then by April 30, 2007, the commission shall approve or deny the plans, and then by Nov. 1, 2007, the companies will implement the plans.

The bill calls on the state to come up with a "state strategic plan for energy affordability on or before March 1, 2007...until March 1, 2019." It calls on the state to come up with a "strategic plan to achieve energy efficiency in low and moderate income neighborhoods" by Jan. 1, 2008. And it asks the Rhode Island Housing and Mortgage Finance Corporation to "consider establishing and implementing a program to support energy efficiency in residential mortgages and/or loans" by July 1, 2008.

It also helps out "very low income customers" who have had difficulty paying bills. A customer who has been terminated from gas or electric service can have a one-time opportunity to meet certain conditions to get their service back, and the legislation outlines those conditions.

The bill's foreward explains: "energy costs have been rising sharply while the incomes of low-income households have been declining with the result that energy costs are a substantial and growing hardship; the housing stock occupied by many low-income households is old and energy-inefficient; Rhode Island has lacked an overall state strategy and commitment to addressing these conditions; and... it is necessary for public health and welfare to address the energy needs of low-income households in a manner that supports the efficient use of energy resources."