2008 Agenda For Effective Environmental Stewardship
January 2008
Washington state’s residents pride ourselves on our connection to the marvelous natural resources that surround us. Farmers, foresters and fishermen work every day surrounded by nature, choosing those jobs because they enjoy the beauty of their surroundings. The rest of us reach out to our natural environment, enjoying the hiking, kayaking, sailing, hunting and beautiful views that the rolling hills, the mountains, forests and water provide.
Our prosperity has put Washington’s residents in a position to pay for those amenities, providing incentives to offer services and products that provide effective environmental stewardship.
The standard environmental approach, reliant on top-down regulation, government spending and political decisionmaking, is failing. There is now an opportunity to engage the public and harness the power of millions of Washington residents to make a real, long-term impact on the environment.
The 2008 Legislature has an opportunity to put the promotion of green power in the hands of consumers; improve salmon habitat, mirroring the success of public and private foresters; and unleash the power of local schools to improve energy efficiency.
The 2008 Agenda for Effective Environmental Stewardship seeks to achieve these goals with three common-sense policies:
* Provide economic incentives to increase the sales of green power to wealthy customers.
* Open 500 miles of salmon habitat each of the next five years by fixing nearly 1,700 Department of Transportation culverts that have destroyed thousands of miles of critical habitat.
* Free school districts to find innovative ways to improve energy efficiency by removing cookie-cutter building regulations that have increased costs on districts but have not reduced energy costs.
All three of these agenda items are built upon a record of success elsewhere. Portland General Electric saw its voluntary green energy sales increase dramatically by using a profit incentive. Forestry companies and the State Department of Natural Resources, which earn revenue from forest management, are far ahead of the state in opening new salmon habitat. Washington’s school districts have a history of success at creatively improving energy efficiency.
Unleashing individual incentive and putting power in the hands of consumers have several advantages over traditional, political solutions. They work hand-in-hand with prosperity, not against it. They cannot be changed by shifting political winds or the politics of the budget process.
Most of all, they do not rely on the correct judgment of a few policymakers in Olympia, but unleash the energy and creativity of millions of people who care about the environment and provide incentives for them to take meaningful action.
These are the attributes that have made Washington a leader in so many creative industries. They can also make a positive difference for the environment.
Use the Market to Increase Sales of Renewable Energy Beyond the I-937 Quotas
With a simple policy change, Washington has the opportunity to increase the amount of green energy sold in Washington while reducing the impact of higher energy costs on low-income families.
For several years, Washington residents have been able to ensure that some or all of the energy they use is “renewable” by paying a little extra each month on their energy bill. The program, however, has been limited in its success due to a number of limitations.
First, utilities have little incentive to market the program because they are prohibited from earning additional profit on the green energy sales. As a result, in many cases the utilities simply do the minimum required by law and sales are fairly low, amounting to 1-2 percent of residential customers.
Further, the passage of Initiative 937, which set targets for “renewable” energy for all major utilities, undermined the incentives of utilities and customers to promote voluntary green energy purchases.
Currently, utilities, concerned about finding a sufficient supply of green energy to meet the quotas, have incentives to scale back voluntary programs. Voluntary purchases don’t count toward the I-937 targets, adding to the amount of renewable energy required to meet the goals. As renewable energy supply struggles to keep up with the demand created by passage of renewable energy portfolios, it is increasingly difficult and expensive to meet the quotas. At least one major utility has already cut its marketing budget for the voluntary program in an effort to limit the pressure from voluntary purchases.
Another negative side effect of I-937 is that energy cost increases impact low-income households more than the wealthy. According to one analysis, increases in energy costs are even more regressive than sales taxes. Further, the Washington Climate Action Team staff has noted that costs for renewable energy are rising faster than expected, exacerbating the regressive nature of these costs.
Policymakers should allow utilities to earn profit on the sales of voluntary green energy purchases, encouraging utilities to meet, and exceed, the I-937 quotas sooner than required.
This simple change would:
1. Provide incentives to utilities to aggressively market green energy, increasing overall demand and allowing Washington to move beyond the minimum targets set by I-937.
2. Allocate increased costs from green energy to high-income families who voluntarily pay these costs.
3. Engage consumers, providing another outlet to use their discretionary income to purchase environmental amenities as they do with hybrid cars, organic foods and other “green” products.
Experience shows that this incentive works. Portland, where Green Mountain Energy earns additional revenue for every new green energy customer, has the largest green energy program in the country, reaching more than three times the percentage of residential customers as we do in Washington.
Reallocate Funding to Remove Barriers to Salmon Habitat
Each year millions of dollars are spent in the name of protecting salmon, but for more than 15 years, Washington has made only minimal progress in efforts that would immediately open up thousands of miles of critical salmon habitat.
Across Washington state, nearly 2,500 miles of critical salmon habitat are blocked by state highways and other Department of Transportation projects. These areas are currently blocked by 1,676 culverts which prevent salmon from accessing this significant salmon habitat. Despite the potentially dramatic gains from removing these barriers, the pace of repair has been slow.
Just over 10 percent of the barriers managed by the State Department of Transportation have been removed, and the DOT’s current strategy calls for opening up just 100 miles of habitat a year for the next 20 years. The legislature has budgeted only about $8-12 million a year to achieve that goal.
By way of contrast, the Department of Natural Resources, which earns money from timber harvests, has already fixed more than half of the 1,840 blockages identified in 2001.
The pace of progress is so slow that the state lost a lawsuit earlier this year to Washington’s tribes and is currently negotiating a settlement to speed up the pace of culvert repair. This should not have been a surprise. On Earth Day 2005 we noted that fixing culverts would “open up hundreds, and perhaps thousands, of miles of needed habitat for the recovery of wild salmon. The problem is that legislative funding for such projects has been squeezed out in favor of other priorities.”
It is time that Washington make opening up salmon habitat a priority. Removing barriers to salmon habitat is the most immediate and cost effective way to improve the availability of the habitat salmon need to continue their recent positive population trends.
Remove Cookie-Cutter Approach and Turn Schools Into Laboratories for Energy Savings and Education
As Washington state looks for new ways to reduce energy costs and increased education funding, the legislature can begin by removing “green” building regulations that have turned out to be costly and ineffective and let districts become laboratories for efforts to save energy.
In 2005, the Legislature adopted legislation requiring schools to meet “high-performance” building standards. Some argued that schools would see significant energy savings that would pay for the small additional cost of using the new standards. It was claimed that “green” schools were already seeing reductions of 30 percent and that future schools would see savings of 30-50 percent in energy costs.
Now that some of those schools have been open for three years, it is clear that the regulations are more costly than expected and that “high-performance” schools do no better at energy savings than traditionally built schools.
For instance:
* In Spokane, Lincoln Heights Elementary, rebuilt using the “green” building standards, is using 14 percent more energy per square foot than Browne Elementary which did not use the standards.
* Four non-green schools have lower energy costs per square foot than “green” Franklin Elementary in the Lake Washington School District. Additionally, the District says the “green” elements cost an additional six percent, three times the maximum predicted cost of the standards.
* In their 2005 flyer asking the legislature to pass the new regulations, the Washington Conservation Voters claimed that Giaudrone Middle School in Tacoma had “realized energy savings of 35%.” In fact Giaudrone, compared with a similar school built at the same time, spent 45 percent more during the most recent school year, 24 percent more in 2005-06, and in 2004-05, 34 percent more.
These aren’t isolated examples. Virtually all “high-performance” schools have higher energy costs per square foot than similar schools without the standards in the same district. By contrast, districts are already making good strides in reducing energy costs without the standards. In 2006, energy costs for elementary schools in the Spokane School District averaged $1.39 for schools built before 1948, $1.34 for those built between 1948 and 1962, $1.26 for schools built in the 80s, $1.18 for those built 1990-2001 and $1.14 built since.
While the standards have not lived up to their promise, the costs are now entirely borne by the districts
themselves. Unchanged, these unfunded mandates will hurt both schools and the environment.
The disappointing performance of these standards robs school districts of funding that is needed elsewhere in the educational system. Further, the funding for these costly regulations could go to other programs that are effective at reducing energy use, CO2 emissions or other environmental benefits.
Acknowledging the poor results from these regulations, policymakers should:
1. Allow school districts to opt-out of the “high-performance” building standards in favor of local efforts to reduce energy use and other utilities.
2. Provide funding for a second round of pilot schools to build on the lessons learned from the initial set of pilot schools.
Todd Myers is director of the Center for the Environment at Washington Policy Center, a non-partisan public policy research organization in Seattle and Olympia. Nothing here should be construed as an attempt to aid or hinder the passage of any legislation before any legislative body. For more information contact WPC at 206-937-9691 or online at washingtonpolicy.org.