Western Governors Adopt Policies on Clean, Diversified Energy, Global Climate Change and Transportation Fuels (6/11/06

Western Governors Adopt Policies on Clean, Diversified Energy,
Global Climate Change and Transportation Fuels

FOR IMMEDIATE RELEASE
June 11, 2006

Contact:  Karen Deike, 303-377-6787

SEDONA, ARIZONA -- Western governors today committed to take action on a number of fronts to bring on-line substantially more clean and diversified energy resources, improve energy efficiency and ensure there is adequate transmission available at a reasonable cost well into the future.

They also said the country could help reduce its reliance on unstable foreign oil supplies by supporting additional research and development of cleaner, alternative transportation fuels.   Additionally, they called for a full and vigorous discussion regarding the reduction and mitigation of greenhouse gases, adaptation policies and other global climate change measures.

On the opening day of the Western Governors' Association Annual Meeting, the governors backed a broad-based set of proposals for meeting future electricity needs.  The policy resolution is based on the recommendations developed over the past 18 months by more than 250 stakeholders, whose work is outlined in the WGA report released today entitled, Clean Energy, a Strong Economy and a Healthy Environment. The goals, which the group found could be met or exceeded, are to develop an additional 30,000 megawatts of clean energy by 2015; increase energy efficiency 20 percent by 2020; and ensure secure, reliable transmission for the next 25 years.

The resolution adopted by the governors was brought forward by Govs. Janet Napolitano (Ariz.), WGA Chair; Bill Richardson (N.M.) and Arnold Schwarzenegger (Calif.), who proposed the initiative two years ago; Dave Freudenthal (Wyo.); and Mike Rounds (S.D.), WGA Vice Chair.

We are grateful to all those who dedicated so much time to this remarkable effort and worked hard to find common ground, Napolitano said. The Western governors believe the actions identified will help protect our region from energy shortages and price spikes, improve the balance of energy resources used to produce electricity, encourage more energy-efficient practices, and mitigate the environmental impacts of power generation.

Gov. Freudenthal moderated the discussion among the governors and panelists.  Speakers at today's session included Joseph T. Kelliher, Chairman of the Federal Energy Regulatory Commission; Jeff Sterba, Chairman, President and CEO of PNM Resources and representatives from government, the environmental community and industry.

The Governors urged FERC to build a partnership with Western states to make more efficient use of the existing electric transmission grid, expand the grid to enable the region to tap remote, diverse generation, and work closely with the Western Interconnection Regional Advisory Board to ensure grid reliability.

The recommendations are cross-cutting and recognize the value of and need for reliable power generation from many sources, including cleaner-burning coal, wind, geothermal, solar and biomass, Freudenthal said.

Gov. Schwarzenegger said the recommendations address difficult and profound challenges.  When we work together, these ambitious goals are 100 percent attainable.  They're too important for us to do anything but work together.

Gov. Rounds said governors will consider measures most appropriate for their states by encouraging regulators, policymakers, utilities, transmission operators and other stakeholders to eliminate barriers to greater utilization of clean energy resources.

There is much we can do within our states, but federal action also is needed to reach our mutual goals for secure, reliable energy within our region and across the country, Rounds said.  Western governors will work with Congress and the Bush Administration to see these recommendations are implemented.

The governors identified the following federal policies and legislation needed:

• Provide for a long-term (10 year) extension of the production tax credit for all renewable energy technologies, with complementary polices for consumer-owned utilities and tribes;
• Provide tax credits for energy efficiency investments;
• Raise the cap on the residential investment tax credit to $10,000 for renewable energy or distributed generation systems;
• Support improvements in national appliance efficiency standards;
• Encourage adequate funding for state programs, including energy efficiency, clean generation and storage technology research, development and demonstration;
• Encourage federal agencies to collaborate with Western states and regional organizations on facility siting and infrastructure planning, consistent with sound, sustainable environmental practices;
• Extend the federal tax credit for Integrated Gas Combined Cycle facilities for five years and provide a tax credit program for carbon capture and sequestration for at least five years;
• Support increased federal support and tax incentives for the construction of multiple pilot facilities that demonstrate IGCC in the West at high altitude using Western coal; and
• Encourage proactive, transparent, stakeholder-driven regional transmission expansion planning, defer to existing regional and sub-regional processes that meet such standards, and reform imbalance penalties to allow for greater use of the existing transmission system.

On the transportation fuels front, the governors said the country must reverse its over-dependence on volatile foreign oil supplies in ways that can benefit both the environment and the regional economy.  Among the measures the governors called for are:

• expand economic opportunities through the production and distribution of domestic renewable fuels to all regions of the West;
• diversify the country's reliance on petroleum and natural gas as feedstocks for petrochemicals by developing biofuels and coal-derived compounds;
• evaluate alternative transportation fuels' impacts, seeking to reduce greenhouse gas and other emissions and improve air quality and the environment;
• consider carbon capture and sequestration in evaluating the production costs of coal-to-liquids as well as other transportation fuel alternatives;
• encourage distribution of alternative fuel refining and refueling facilities throughout the nation;
• promote the inclusion of higher renewable content blends in existing transportation fuels;
• promote policies that result in more fuel-efficient vehicles and incentivize consumers to purchase hybrids or other fuel efficient vehicles to reduce our per vehicle consumption of transportation fuel.

Gov. Brian Schweitzer (Mont.), a cosponsor of the transportation fuels resolution, said Energy independence is the most important challenge facing this nation and Washington is debating everything but is not directly addressing this challenge. Today, Western Governors are helping to set a new direction to position this region which is rich in coal and biomass resources to develop alternative transportation fuels. We need the federal government to step up to the plate to meet this challenge or get out of the way.

Govs. Richardson, Schwarzenegger and Napolitano also offered a policy resolution on regional and national policies regarding global climate change. The governors stated their support for local, state, regional, and national programs to reduce anthropogenic greenhouse gas emissions in a manner that is consistent with scientific research and will not significantly harm the U.S. economy.

The West is where the action is for clean energy, reducing emissions, and new energy jobs and growth, Richardson said.  I appreciate the Western governors' strong support for these trend-setting energy and climate initiatives.

The policy resolutions adopted today are available on the Web at www.westgov.org.

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The Western Governors' Association is an independent, nonprofit organization representing the governors of 19 states and three U.S.-Flag islands in the Pacific.  Through their Association, the Western governors identify and address key policy and governance issues in natural resources, the environment, human services, economic development, international relations and public management.