Reply to Senator Pileggi’s Guest Column on Energy

By Greg Vitali

This letter is in response to Senator Dominic Pileggi's guest column of February 2nd entitled “Energy conservation a priority in General Assembly”.  Senator Pileggi along with the Pennsylvania Senate is to be commended for taking steps to address Pennsylvania’s energy future. However, they haven’t gone nearly far enough. The Senate has failed to pass key energy conservation and smart metering legislation and the energy fund bill they did pass is not adequate.

Pennsylvania must do much more to conserve energy and to shift from fossil based sources such as coal, oil and natural gas to renewable sources such as wind, solar and biomass.  At the local level this will help ameliorate the electricity rate hikes predicted to be as high as 30% in 2011.  At the national level this will help reduce our dependence on foreign oil and at a global level this will help to combat climate change.

In February of 2007 Governor Rendell proposed his Energy Independence Strategy (EIS) a comprehensive plan for the promotion of energy conservation and renewable energy.  EIS ‘s  components include:  conservation , smart metering, and the energy independence fund. 

Perhaps the most important component of EIS is the conservation program currently set out in H.B. 2200 (George), Special Session S. B. 1134 (Tomlinson) and Special Session S.B 35 (Erickson).  These three bills, all containing similar language, would reduce Pennsylvania’s demand for electricity by about  two and a half percent by creating a system whereby energy service companies (ESCO) would go into homes and businesses and find ways to conserve electricity.

This conservation, by reducing demand, would put downward pressure on electricity prices. This downward pressure is particularly important in light of electricity bill increases predicted to be as high as 30% when electricity rate caps are lifted in the PECO service area on January 1^st, 2011.

The Senate has not taken action on any of the above three conservation bills.  The conservation measures in the Senate fund bill (Special Session S.B. 1 (White )) and described by Senator Pileggi in his guest column are inadequate. 

The Senate has also failed to act on smart metering legislation (also contained in H.B 2200).  This legislation would require utility companies to replace existing electric meters on all Pennsylvania homes and businesses with “smart meters” within the next ten years.

Smart meters would allow customers, if they chose, to be billed for electricity at its actual cost based on the time of day they use it. Electricity is much more expensive during times of peak demand (e.g. two o’clock on a hot August afternoon). With smart metering, consumers could save money and conserve energy by using less electricity during these peak times and deferring some electricity usage to a less expensive time of day.

Although the Senate has passed an energy fund bill, it is significantly inferior to the House fund bill.  Special Session House Bill 1 (DePasquale), would provide about 150 million dollars a year over the next five or six years for, among other things, venture capital, grants and loans to attract renewable energy companies to Pennsylvania.   The Senate fund bill would provide only about 65 million dollars a year and stretch it over 10 years.

It is important that our energy fund be sufficient and timely because Pennsylvania is in fierce competition with other states for these emerging renewable energy companies and the jobs they create. New York and New Jersey are now each spending about $200 million a year and California is spending about $500 million a year.

Negotiations are currently underway between the Pennsylvania House, Senate and Governor’s office concerning the passage of the Governor’s Energy Independence Strategy. The House has already demonstrated it support by passing EIS in large measure. Senator Pileggi, as Majority leader is chief negotiator for the Senate.  Whether EIS becomes law depends to a great extent on him.  Now is the time for citizens concerned with Pennsylvania’s energy future to let Senator Pileggi know how they feel.