SEPTEMBER 27, 2011 PANEL DISCUSSION
Brian Hanninen, Think Again MN Board Member
Former State Senator John Doll moderated the engaging panel discussion on Tuesday evening. The presentations and discussion focused on how community ownership of clean energy will promote economic development across Minnesota
Lynn Hinkle, Policy Development Director for the Minnesota Solar Energy Industries Association, began the evening with a presentation of how clean energy and, in particular, solar energy could create jobs that can support families. Hinkle spoke of how the Property Assessed Clean Energy (PACE) programs, with the emphasis on retrofitting of homes, are able to create jobs and reduce energy consumption. PACE in combination with energy efficiency retrofitting of public buildings and the growth of solar generation systems, can create well-paying jobs within Minnesota across all skill levels and education levels.
Hinkle provided evidence of how solar energy industry creates more jobs per $1 million of investment compared to fossil fuel investment – 14.1 versus 5.3 jobs. Hinkle estimates that in the year 2020 that 3,000 jobs that can support a family will exist in Minnesota’s solar energy industry. Additional benefits of investing in solar energy is that the jobs are created quickly, and Minnesota will move closer to energy independence. He cautioned, though, the fossil fuel industry enjoys hidden subsidies n the tax code that are larger by a factor of 50 to 12 as compared to transparent subsidies to the solar energy industry. Hinkle ended with a promising future of accelerated capital investment within Minnesota once the solar energy sector attains 10 percent of the energy production market in the state.
John Farrell, Senior Policy Analyst for the Institute for Local Self Reliance – based in Washington, D.C., and Minneapolis, Minnesota – next spoke of the future of a democratized energy grid in Minnesota. Farrell began by presenting the potential of renewable energy sources within the United States. 31 states have the potential to meet 100 percent of their electricity needs relying solely on renewable energy sources. All 50 states at a minimum have the potential to meet 25 percent of their electricity needs through locally generated renewable energy. In Minnesota an astounding 2500 percent of its electricity needs could be provided through renewable energy sources; primarily wind energy (90 percent) sources. Farrell pointed out that rooftop solar arrays could meet 24 percent of today’s energy needs within Minnesota. Rooftop solar arrays, as opposed to ground based solar arrays, avoid the environmental concerns faced by solar arrays in the southwestern U.S. deserts.
Farrell countered the arguments of those that question the viability of renewable energy sources by 1) showing that the cost of producing wind and solar energy is nearly comparable to the cost of producing fossil fuels; 2) demonstrating the greater job creation as compared to fossil fuel investments; and the addition of up to $22 billion to Minnesota’s Gross Domestic Product (GDP) and 50,000 jobs through a 10 percent and 90 percent share respectively by solar and wind energy of the state’s electricity market. Farrell pointed out that Minnesota’s GDP is currently $258 billion annually. Additional benefits of a locally owned, renewable energy economy are: economic multiplier affects of local ownership of energy; reduced outflows from Minnesota of money to purchase fossil fuel energy; and higher public support for investments in renewable energy.
Farrell reviewed the current barriers to investment in renewable energy investment. Currently fossil fuel dependent utilities can rely upon generous tax incentives, while renewable energy sources, do not generate similar revenue streams to benefit from the tax credits programs. Renewable energy also is victim to the utility “grid lock”, where utilities justify their monopolies because of the economies of scale needed to build the power-generation and transmission systems to transfer fossil fuel generated energy. Renewable energy sources, though, can be distributed along the electricity grid in much smaller scale, yet create greater efficiencies of the use of the energy grid. Renewable energy, such as solar cells and wind turbines, can almost be located anywhere along the electricity grid. The final barrier is that financing is difficult because of the conundrum of utilities demanding that renewable energy power generators have bank financing first before a contract is signed, and banks demanding those power generators to have contracts with utilities signed prior to offering bank loans.
Farrell ended his presentation by discussing the multiple opportunities that exist to create a clean, local energy future. Cash incentives have been offered by federal and state governments, and could be instituted again to increase the supply of renewable energy. The example of California to demand of its public utilities to geographically map where along their electricity grid that locally produced renewable energy could supplement the grid, have helped generate power generation. This could be replicated in Minnesota to encourage clean, local energy production. Finally, Clean Contracts – replicating long-term (20-year contracts with guaranteed price minimums) offered by European governments to renewable energy producers – could guarantee Returns On Investment (ROI) that would stimulate greater private investment in renewable energy.
George Crocker, Executive Director of the North American Water Office, wrapped up the panel discussion with a reminder to the participants of the importance of community organizing. Crocker reminded the audience of how community organizing was able to counter the demand of the public utilities in the late 1970s and early 1980s during the controversies with building high voltage transmission lines across rural Minnesota. Minnesota’s policy to prioritize first on conservation, secondly on renewable energy sources, and then on down the line of energy self-reliance methods, provided a policy basis in 1974 that had seen no improvement 20 years later in the state’s reliance on fossil fuels. In 1994 the debate on where to place spent nuclear fuel at the Prairie Island nuclear plant revived community organizing as a way to counter the influence of public utilities, or cartels, as Crocker termed them. Although additional storage at Prairie Island was approved, the result was that the Public Utilities Commission was required to increase the market share of renewable energy within Minnesota.
Crocker emphasized that citizens are effectively functionally illiterate in terms of energy policy. Citizens must be knowledgeable in order to effectively organize in support of renewable energy. “Organized people will always beat organized capital,” explained Crocker. Organized communities can advocate for strategically sited and sized renewable energy within their community energy footprints.
The evening ended with 20 minutes of questions and answers by the panelists.