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Is smart energy in N.C. full of crap?

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A couple years ago, some state politicians got this bright idea. They'd run the state on crap.

To do their part to save the earth from man-made global warming, they'd force the state's utilities to get 12.5 percent of the state's energy from pig and chicken poop, biomass, and solar and wind energy.

It sounded so cool, so greenishly eco-friendly. And it looked great on their campaign mailers. The utilities warned that this would cost extra, so the legislators agreed to allow them to pass their costs on to customers in the form of higher energy bills. They passed the bill and patted themselves on the back for being smarter and more innovative than the market makers who'd been blindly powering the state on traditional fuels.

Then the problems started. To produce the legally required amount of energy from chicken poop, it would have to be converted to methane gas. Understandably, no one wants a chicken crap plant near their home. Groups formed to fight the toxic emissions they said would threaten their health and the noxious odors that would wreck their property values, the Winston-Salem Journal reported last week.

But it hasn't just been noisy neighbors who have caused problems. Ironically, environmental groups have stepped in at almost every step along the way to battle the state's green-energy plans.

In this case, the Blue Ridge Environmental Defense League decided to fight the poop plants, which they described to the Journal as "a bad idea."

Finally, the Surry County Board of Commissioners decided that it may block federal incentives the plant needs to get up and running because of local complaints. All this has left the state's utilities with a big headache.

Those utilities quickly ran into another face-palm inducing problem. Legislators, in their infinite wisdom, imagined that Duke Energy would meet its biomass quota by burning wood no one wanted -- like stumps and wood chips and old two-by-fours or something. But there apparently aren't enough of those, so Duke announced it would have to begin essentially cutting swaths of the state's forests and throwing whole trees into its incinerators -- and apparently not the already-dead kind either.

The environmentalists freaked again. They joined the state's environmental reporters in trashing Duke, never mind that Duke was ordered to embark upon this lame-brained mission by the states legislators or the fact that Duke had never shown much interest in massacring trees before the passage of Senate Bill 3 forced it to.

Then the North Carolina Environmental Commission jumped into the act, arguing for a maze of bureaucratic standards to dictate which trees Duke could cut. Then others, including The Charlotte Observer editorial board, started asking questions about whether burning trees would release more pollutants than Duke's new state-of-the-art coal plants.

And those are just the problems with the poop and pulp. Across the state, battles are being fought over where it is and isn't permissible to locate the wind farms needed to generate the wind component of the renewable-energy mandate. Investors have spent millions only to walk away befuddled by an onerous permitting process that has gotten worse as political battles rage over the aesthetics of windmills.

When S.B. 3 passed back in 2007, legislators put caps on how much extra utility companies could charge ratepayers to cover the costs of exotic energy sources. But as the Carolina Journal and other publications pointed out last year, those caps are already in danger of being breached before the program is even fully up and running -- and long before utilities have reached their 12.5 percent mandate in 2021.

According to the Beacon Hill Institute, which studied the impacts of the law, with the caps in place, the renewable-energy mandates could cost the state up to $1.8 billion in higher electricity rates, while slashing the state's economy by more than $140 million a year by 2021. It also puts 3,600 jobs at stake. If the caps were lifted and ratepayers and businesses were exposed to the true costs of renewable energy, the mandates could cost North Carolinians more than $4.4 billion and 15,000 jobs by 2021 as businesses and customers eat the costs of energy experimentation.

To find out what to expect, North Carolinians can look to Los Angeles, which has a similar program. Mayor Antonio Villaraigosa recently announced increases in electric bills that will run between eight and 30 percent -- depending on where customers live -- in order to pay for his plan to get up to 20 percent of the city's electricity from renewables.

All of which makes me wonder, given that 18 other states in the region lack these laws, exactly what kind of hit we're going to take to our competitiveness.

Sure looks like smart energy, at least for now, is going to leave a lot of people smarting.


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