Donald Kochan had a good commentary in The Chicago Sun Times this week on Illinois’ new mandate requiring utilities to increase the amount of in-state renewable energy they purchase. Kochan argues that limiting the requirement to Illinois-based renewable generation will result in less clean energy and higher bills for consumers.
“Illinois and other states should make it their policy to foster utilization of these markets. They should encourage in-state electricity stakeholders to engage in these markets to find the lowest-cost energy sources. And Illinois should loosen the grip of the Illinois Power Agency and break down the monopoly of Illinois utilities. Other states should take the same approach.”
State experimentation is a feature of our federal system. It helps us identify good and bad policies. Competition in energy supply policy is no different. Unfortunately, recent efforts in Illinois fall on the side of helping us learn what not to do.
This fall, Gov. J.B. Pritzker signed a law with lofty but unachievable climate-enhancing goals. Worse, the legislation ignores the lessons of economics by constraining the market for mandated renewable energy supply to in-state sources. These constraints come at the expense of the benefits consumers would get from a more robust embrace of electricity suppliers, by looking to interstate and regional energy markets to achieve consumer efficiencies.
First, Illinois’ ambitious new energy plan anticipates massive spending to address climate change. Yet, recent Illinois history tells us it will hardly make a dent on that goal.
The new legislation sets targets to move away from fossil fuels, declaring that 40% of the state’s electricity should come from renewable sources by 2030, with even higher percentages each decade thereafter. It also calls for shutting down coal-fired and gas-fired power plants on a graduated but aggressive schedule.
The problem is that Illinois has tried this before, with little success on proponents’ own environmental metrics. Recent past efforts were made at the expense of alternative means for reaching energy efficiency that would better reduce pollution and lower electricity costs.
Read the full piece in The Chicago Sun Times.