In his recent address to the U.S. House and Subcommittee on Energy and Power, Xcel Energy Inc. Chairman, President and CEO, Ben Fowke voiced his support for a federal customer renewable credit (CRC). Now if I lost you at customer renewable credit, please hold on. I’ve waded through the legislative lingo and I believe I can explain this in layman’s terms.
What is the Customer Renewable Credit (CRC)?
Basically, the CRC is a bipartisan law that would create a new incentive for wind and solar renewable energy generation, save utility customers money, provide utilities with a tax credit or payment to, and deliver a net savings to the federal treasury. Let’s take a closer look.
1) Customer Benefits: Currently, federal and state mandated renewable energy generation costs are passed directly to utility customers (see bill graphic below). The CRC would ensure that a portion of renewable energy incentives would be directly distributed back to customers.
2) Utility Tax Credits and Payments: To help offset renewable energy integration costs and provide additional incentives for clean energy generation the CRC would provide a tax credit for investor-owned utilities (like Xcel Energy) and a payment for non-taxable municipal, cooperative and power marketing administration utilities.
3) Increasing Incentive: The credit increases as more wind and solar energy is added. Starting at 0.1 cent per kilowatt-hour (kWh) and increasing to 0.6 cents per kWh at 24% wind generation.
4) Federal Savings: Because of its low stand-alone cost (the CRC is estimated to cost $2.6B over 10 years compared to the current Production Tax Credit, or PTC, cost of $5B to $12B per year), the CRC helps reduce the financial burden of the federal government.
5) Job Creation and Support: In addition, the incentives outlined in the CRC would help promote and support job growth in already existing wind and solar baseload power facilities.
In the spirit of keeping this a simple as possible, I’ll sum it up here. As utilities are continually required to increase electricity production from intermittent renewable resources there are significant costs associated with putting these resources onto the grid. Therefore, the CRC helps to mitigate costs and rewards both consumers and their utilities. In addition, the incentives help create and maintain jobs, and reduce the financial burden on the federal government.
Of course this only scratches the surface and highlights of the CRC; however, there is a wealth of additional resources that help explain the CRC and the existing PTC. But if what you’ve read is enough to justify your support, please reach out to your U.S. Senator and/or Representative and let them know you support the Consumer Renewable Credit.
Use the link above, copy and paste the letter with subject line below and email it to your local senator and/or representative.
SUBJECT LINE: I support the Consumer Renewable Credit
Dear Honorable <Sir or Madam>,
I support the Consumer Renewable Credit. It helps create and maintain renewable energy jobs, it delivers a direct incentive to me and my utility and it reduces the financial burden of the U.S. Treasury.
Please help see that this legislation gets the attention and support it needs to get voted through.
<Insert Your Name Here>