Alternative energy splits Pa. business community

A rebate program that Gov. Rendell hoped would entice Pennsylvanians to convert to solar energy is proving particularly popular with businesses - just as the state's primary business-advocacy group is ramping up its campaign against a legislative proposal that would require greater use of alternative energy.

The Pennsylvania Chamber of Business and Industry acknowledges that House Bill 80's increased requirements for the use of solar and wind energy would create clean-energy jobs. But they also would cut jobs in conventional-energy industries such as coal and drive up electric rates at least 13 percent, the chamber contends.

"We're not anti-alternative" energy, Gene Barr, vice president of government and public affairs for the chamber, said in an interview last week. "But for government to dictate, 'Here's the exact percent of the exact technology we want,' that goes well beyond what we think the role of government ought to be."

It is a position dividing the state's business community.

"They don't represent my opinion," said Ron Barchet, who owns Victory Brewing Co., of Downingtown, with childhood friend Bill Covaleski.

Their company is among the hundreds taking advantage of the $100 million Pennsylvania Sunshine rebate program. Victory is having a photovoltaic system installed on its roof in April because "it's just part of being a modern, responsible business," Barchet said.

The $415,000, 66.6-kilowatt system is expected to offset 5 percent of the brew pub's electricity use, reduce Victory's monthly electric costs by $1,000 - nearly 10 percent - and pay for itself in five years, Barchet said. The state says 35 percent of the nearly $8 million in pending claims for solar rebates are from small businesses.

While generally "pretty much a small-government guy," Barchet said, he supports the idea of Pennsylvania offering such financial incentives and mandating more use of renewable energy "to spur" the development of such energy sources and related industries.

"It's a jump-start," he said.

House Bill 80 would build upon the state's first clean-energy requirements, adopted in 2004. Those mandate that the state's electricity suppliers obtain 8 percent from renewable resources by 2021. House Bill 80 would increase that to 15 percent by 2026. The legislation went nowhere last year as interest groups, including environmentalists, electrical workers, solar installers, and miners, lobbied for changes.

Rendell is running out of patience. During a public appearance in Media last month, the governor called for an all-out "war" to win passage of House Bill 80, describing the measure as "the single most important thing that we have to do for the long-range health of the state."

Last week, proponents of the bill were energized by a study released by Black & Veatch, a global engineering, construction, and consulting company, on the likely ramifications of enhanced alternative-energy requirements.

The study, commissioned by the Community Foundation for the Alleghenies in partnership with the Heinz Endowments and the William Penn Foundation, projects a $26 billion boost to the state's economy, such as from job creation. Contrary to the chamber's claims that alternative energy is more expensive and would drive up electric bills, Black & Veatch anticipates a potential increase in additional electricity costs of less than 1 percent for customers across the state - or 50 cents a month for the average residential bill - and possibly savings. The report does caution that its findings are based on "hundreds of assumptions" related to resource availability, cost, and economic impact.

Barr, from the chamber, said he had not had a chance to evaluate the Black & Veatch study to explain the drastic difference between its conclusions and the chamber's contention that House Bill 80 could trigger double-digit increases in electric rates.

Part of the chamber's reason for urging defeat of House Bill 80, he said, is that the effectiveness of the state's existing alternative-energy portfolio standards is not yet known as utility companies still under state-required rate caps, including Peco Energy Co., do not have to comply.

"It makes sense to wait until the effect of [the current alternative-energy standards] is known before further expanding mandates," the chamber's special-projects manager, Jim Willshier, said in an e-mail sent to local chamber leaders last month.

John Hanger, Pennsylvania's environmental secretary, scoffed at that suggestion Thursday.

Pennsylvania already has "one of the lowest standards in the country," he said, putting the state at a competitive disadvantage, even to neighbors New Jersey and Maryland, in the ability to attract alternative-energy companies.

He criticized the chamber as being "all about ideology and not economic development" and said its position on House Bill 80 "would kill one of the fastest-growing business sectors in Pennsylvania."

At Citizens for Pennsylvania's Future, an advocacy group that held six breakfasts around the state last month to push for House Bill 80, president Jan Jarrett expressed frustration over the Pennsylvania chamber's position on the legislation: "I don't know what the chamber has against new jobs."

Echoing that frustration were Kira Costanza at Sunpower Builders in Collegeville, Montgomery County, and Glenn Burd at Solardelphia in Carversville, Bucks County. Both companies are solar installers that credit the Pennsylvania Sunshine Program for their growth in the last year. Solardelphia, which had three employees a year ago, now has 13. Sunpower has added "a person a month" since the rebate program launched in May, Costanza said.

Both said work orders at their companies were steadily growing, with prospects under House Bill 80 even sunnier. It would boost the state's solar requirement from 0.5 percent to 3 percent.

But at what cost? asks Terrance Fitzpatrick, president of the Energy Association of Pennsylvania, a trade group representing electric and gas utilities.

Given that the field of alternative energy is still evolving, he said, "that argues against locking in right now what [alternative energies] must be used" through 2026.

"The things that make sense now might not . . . make sense then," he said.