Olympia Legislative Report, February 22, 2013

Washington Clean Technology Alliance
Prepared by:  Boswell Consulting

In the Senate, two important bills dealing with I-937 passed out of the Senate Environment Committee this week.  SB 5648 (making energy conservation a top priority by adding new incentives and aligning the timing of the acquisitions of eligible renewable resources, electricity, or equivalent renewable energy credits, with the need for additional electric generating resources to serve consumers’ loads, without changing the eligible renewable targets) and SB 5438 (using conservation achieved by a qualifying utility in excess of its biennial acquisition target under the energy independence act) – both are controversial and face an uncertain future in both the House and with the Governor.

This week, HB 1693 was discussed on the House Technology & Economic Development floor.  The prime sponsor, Representative Habib, explained that this bill could help start up companies in the state of Washington by giving them B&O tax relief for the first 36 months within high growth business sectors.  Supporters testifying in support explained how with this tax exemption will help startup companies to succeed.

The governor spoke this week in front of the Senate Energy, Environment and Telecommunications Committee on his climate change proposal SB 5802, developing recommendations to achieve the state’s greenhouse gas emissions limits.  He testified that the standards for greenhouse gas reductions set in 2008 have not been met because the tools to meet those standards have not been created.  Senator Ericksen voiced concerns by asking how to move forward and create clean sector jobs without losing manufacturing jobs. Governor Inslee explained that he did not have all the answers but this is a chance for everyone to work together to find those answers.  Governor Inslee continued saying that the monetary cost now is nothing compared to the cost of inaction to our environment.  While there may be some hesitance about what the outcome of lowering emission standards will be on both our environment and economy, this bill seems to have support by the legislature.  The following are key provisions of this Legislation:

The Office of Financial Management  (OFM) must contract with an independent and  objective consultant to prepare a credible evaluation of approaches to reducing GHG. The evaluation must be provided to the Governor by October 15, 2013 for use by the Climate Legislative Workgroup (Workgroup).  The evaluation must include a review of other countries’ and states’ GHG emission reduction programs and regional  efforts to reduce GHG.  The evaluation must  include available information from each program on:

  • the effectiveness of the jurisdiction in achieving its emission reduction goals; the impact on the economy, including power rates, agriculture, manufacturing, and  transportation fuel costs;
  • the effect on household  consumption and spending, including measures to mitigate for low-income populations;
  • displacement of emission sources due to the program; significant co-benefits, such as to public health;
  • achievements in greater independence from fossil fuels and the economic costs and benefits; the most effective implemented strategy and the trade-offs made; and opportunities for new manufacturing infrastructure, investments in cleaner energy and  energy efficiency, and jobs including in-state opportunities.

The evaluation must analyze Washington State’s emissions and related energy consumption profile and include the following: total expenditure for energy by fuel category and sources of fuel; and options for an approach to reduce emissions that would increase spending on instate energy production relative to expenditures on imported energy sources, and effects to job growth and economic performance.

The Governor is expected to come forward with a proposal in the next two weeks to provide a fund of at least $40 million to help startup companies in the clean tech arena.  There are not any details on this proposal and it is still unclear how his proposals are going to fare with a significant budget shortfall and education funding mandate looming over the legislature.

The full report including Bill Tracking can be found here.