Renewables have rough ride in Idaho
http://www.spokesman.com/blogs/boise/2012/aug/12/renewables-have-rough-ride-idaho/
In 2011, Idaho's Department of Commerce devoted a 37-page magazine to renewable energy, with Gov. C.L. “Butch” Otter touting geothermal, wind, solar and biomass. “Sustainable, renewable energy is going to play a big role in Idaho's future,” Otter proclaimed.
The publication now doubles as a grim recapitulation of projects where the lights have dimmed or gone out.
Hoku Corp.'s $400 million Pocatello solar polysilicon plant has been mothballed, while Transform Solar, Micron Technology Inc.'s energy venture, is dead. A biomass power project at an Emmett sawmill highlighted in the magazine failed, too, forcing its developers this month to pay Idaho Power Co. $200,000 in damages.
Additionally, independent wind and solar entrepreneurs complain Idaho's policies have suffocated development. The 2011 Commerce publication spoke of Idaho's renewables “sweet spot” — just as the
Idaho Legislature that spring rejected keeping a tax rebate for alternative power producers alive.
Peter Richardson, a Boise energy lawyer and would-be solar developer, contends his industry faces a “train wreck.”
“New projects are non-existent,” Richardson said. “There's no support for renewables in this state.”
Even the future of funding for Otter's Office of Energy Resources' is in jeopardy because renewables haven't panned out.
The office was to be funded by royalties on federal geothermal leases, but
those never materialized.
Geothermal developers say declining natural gas prices,
expiring tax incentives and a surplus of cheap, existing power amid the economic downturn now make developments in Idaho a tough proposition.
For the last half-decade, Idaho's renewables industry has been dominated by wind projects.
Developers installed hundreds of megawatts that regulated utilities had to buy, according to a 1978 federal law.
State and federal tax breaks also made their projects attractive for investors.
But the rush to wind turbines largely ended in 2010, when the Idaho Public Utilities Commission intervened on behalf of utilities that complained wind farms were
driving up ratepayers' costs.
“Wind is just not a good resource for Idaho Power,” Mark Stokes, the utility's power supply manager, said Tuesday, contending
wind is unreliable on hot, summer afternoons when the utility needs power for irrigation pumps and air conditioners.
The cost of electricity in Idaho,
produced largely by dams, coal-fired power plants and natural gas turbines, is second-lowest in the nation, according the Institute for Energy Studies.
Consequently, regulated utilities have little economic incentive to buy electricity from renewables providers. And unlike Oregon and Washington policy makers,
Idaho legislators haven't required utilities to buy a percentage of their electricity from alternative projects.
In Otter's first State of the State speech in 2007, the incoming governor announced Hoku's Pocatello solar plant,
promising hundreds of high-paying construction and manufacturing jobs. Today, Hoku's parent company faces potential
bankruptcy; it laid off its last 100 Idaho workers this spring.
The 2011 Department of Commerce magazine, entitled “Energy Opportunities are ON,” predicted a renewables renaissance in Idaho. Things haven't worked out as well as many of the companies featured had hoped. Here's a partial list of projects that have faltered.
— Solar declines: In the 2011 magazine, the Department of Commerce announced Hoku Corp. was putting the “final touches” on its $400 million polysilicon manufacturing plant in Pocatello to supply the solar panel industry. The plant hasn't been completed and its employees have been laid off.
And Transform Solar, the joint venture between Idaho-based Micron Technologies Inc. and Australia's Origin Energy, were just preparing to hire hundreds at the time it was lauded by Gov. C.L. “Butch” Otter in the 2011 publication. Earlier this year, the company announced it was shutting down, laying off its workers and closing the Nampa factory's doors.
— Turbine trouble: The agency publication predicted that Utah-based Pavilion Energy Resources would be building a new wind turbine manufacturing facility in Idaho to mass produce low-wind turbines, to fulfill an initial $100 million turbine order. Last month, the company's leader, Rick Wood, said from his offices in Salt Lake City, “If Idaho doesn't get its act together, there's a real chance we're not going to go ahead.”
— Biomass bust: Yellowstone Power, a company developing a $28.5 million biomass facility at a proposed sawmill in Emmett Idaho, won a 15-year electricity purchase agreement from Idaho Power that got attention in the magazine. Last week, Montana-based Yellowstone agreed to pay Idaho Power $200,000 in a non-performance damage settlement because the project failed and it couldn't deliver promised electricity.
—Wind departs: Notably, one of the Idaho Department of Commerce's biggest marketing coups of 2008, a turbine-manufacturing factory of California-based Nordic Windpower lured to a vacant military building in Pocatello, wasn't featured in that magazine. The reason? Nordic decided Idaho was too far from its customers in the Midwest so it moved to Kansas.
