Clean Jobs Bill could be costly
Maryland Gov. Larry Hogan (R) vetoed the Clean Energy Jobs Act of 2016. However, the Maryland legislature has recently overridden this veto and the state is on its way to 25 percent renewable energy by 2020. Although the desire for clean renewable energy is admirable, the growth to 25 percent in only three years would be an extraordinary accomplishment, and possibly a costly one.
The Clean Energy Jobs Act allows utilities to purchase clean power elsewhere or generate their own or some combination thereof. Large scale sources of clean power are wind, solar and hydroelectric. Nobody is building hydroelectric dams these days, so the only viable alternatives are to buy or generate solar and/or wind power.
According to the U.S. Energy Information Administration, Maryland produced about 3,000 thousand Mega Watt hours (MWh) of electric power in October 2016 of which only 5.7 percent was from renewable sources. The goal of 25 percent equates to approximately 591 thousand Mega Watt hours additional per month. Cost estimates can be made by comparison with recently constructed clean power facilities.
In 2012, Southern Maryland Electric Cooperative (SMECO) began operation of a 5.5 Mega Watt, 33-acre solar facility with a construction cost of about $20 million on property already owned by SMECO in Hughesville. Solar power produced in Hughesville in the year 2013 totaled 9,200 MWh, or on average 767 MWh per month. Scaling these SMECO facility numbers up to the 25 percent goal, an additional 25,000 acres of solar farm are required with an approximate construction cost of $15 billion (presuming all the addition clean power is by solar).
An alternative to solar, wind turbines of commercial scale produce about 2 MW of power, are about 400 feet tall and need about 2 acres of ground each. The Allegheny Ridge Wind Farm in Pennsylvania is a good example of such. These type of units cost $3-4 million each for installation. To meet the 2020 goal, approximately 1,368 large wind turbines are required at a construction cost of about $4.8 billion.
Should Maryland utility companies decide to construct their own new clean power sources within Maryland, expected construction costs could range well up into the billions. Further, if the increasing demand for clean power necessitates that non-Maryland suppliers to Maryland utilities construct new facilities then those costs will eventually be passed to Maryland consumers as well. The Clean Energy Jobs Act requires a huge investment, whether it be by taxpayers or utility companies (and subsequently their customers). It is uncertain how this start-up funding would be accrued. Would it be through a large government grant, or amortized over long term and added to customer bills, or combination of both or something else? In any case, Marylanders should be prepared for significant increases in cost of electricity.
J.R. Curtis, La Plata