Oregon enacts tough renewable power requirement

LOS ANGELES Wed Jun 6, 2007 7:56pm EDT

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LOS ANGELES (Reuters) - Oregon Gov. Ted Kulongoski on Wednesday signed into law a requirement that 25 percent of power delivered by the state's biggest utilities be made from renewable sources by 2025.

Oregon became at least the 24th U.S. state to have established a 'renewable portfolio standard." It is the last of the three Pacific Coast states, that also include Washington and California, to establish an RPS.

Oregon plans to have steps along the way to 2025. It set targets for 5 percent by 2011, 15 percent by 2015, and 20 percent by 2020.

Two investor-owned utilities -- Portland General Electric and PacifiCorp., a Berkshire Hathaway Inc. unit of Mid-American Holdings Co. -- and one publicly owned utility, Eugene Water and Electric Board (EWEB), are affected.

Portland Gen with about 800,000 customers delivers 43 percent of Oregon's power, PacifiCorp with about 550,000 customers delivers 30 percent and EWEB with about 85,000 customers delivers 6 percent.

Utilities that do not deliver at least 3 percent of the state's electricity will have to meet less demanding targets.

"This bill is the most significant environmental legislation we can enact in more than 30 years that will also stimulate billions of dollars in investment creating hundreds, if not thousands, of jobs in both urban and rural Oregon," Kulongoski said. "Today we are ... protecting our quality of life, reducing greenhouse gas emissions, stimulating our economy and protecting ratepayers with more stable and predictable utility rates."

To be counted, the renewable sources must have not been in operation after January 1, 1995. This means that much of the state's sizable hydropower generation will not be counted. Sources that will count toward the target include wind, solar, wave, geothermal, biomass, new hydro projects or efficiency upgrades to existing hydro projects.

Utilities will not be required to comply with the standard if the result will be a rise of more than 4 percent in ratepayer charges.

Kulongoski said the Oregon legislature in its current session "must not leave without enacting" a biofuels package including development incentives and mandates for future levels of biofuels in fuel blends, and expansion of a business energy tax credit program of up to 50 percent on projects of up to $20 million.

A federal renewable portfolio standard may pass the U.S. Congress this year. It is likely to appear as an amendment to an energy bill put forth by Senate Majority Leader Harry Reid of Nevada. That bill may come to the Senate floor as early as next week, said a spokesman for New Mexico Democrat Sen. Jeff Bingaman, chairman of the energy and natural resources committee.

This proposed federal standard for renewables at 15 percent would not supersede more stringent state targets, said David Marks of Bingaman's office.

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