WASHINGTON, D.C. – A dramatic expansion of renewable energy will strengthen America’s economic, energy and climate security, but it is critical for policymakers to take action this year, FPL Group Chairman and CEO Lew Hay told the nation’s utility regulators today.
“Our nation is at a critical moment in history, confronted by a triple threat of challenges – an economy in recession, an overdependence on foreign energy, and a warming planet,” Hay said in a speech to the National Association of Regulatory Utility Commissioners in Washington, D.C. “Simply put, we must create a clean-energy economy for the 21st century – one that will help pull our economy out of recession, strengthen America’s energy security in a volatile world, and address the threat of global climate change.”
Hay cautioned, however, that these important national goals can be derailed by shortsighted policies that make it financially impossible for utilities to embrace clean energy or that saddle customers with too high a cost, too quickly.
Seven-Point Plan for Energy Security
Hay charted a seven-point plan to make the transition to a low-carbon economy. First, he called on policymakers to enact mandatory climate change legislation this year that puts a price on carbon. “We must ‘make polluters pay.’ Only when carbon carries a price equal to its cost to society as a whole will we have a level playing field among all forms of electricity generation,” Hay said.
Second, Hay called for investment incentives for renewable electricity generation, coupled with the enactment this year of a national renewable portfolio standard (RPS). “Our current energy policy is too vulnerable to short-term fluctuations in the price of fossil fuels,” Hay said. “A national RPS will put a floor under the price of renewables by ensuring demand for wind and solar energy. At the same time, it is likely to lower electric bills in competitive markets by reducing the price of natural gas, according to the Energy Information Administration.”
Third, Hay urged support for a significant expansion of transmission capacity. “The current system was never intended to move lots of power over long distances or to handle the large amounts of wind and solar energy we have seen coming online in recent years,” Hay said. “It was designed for a different, more provincial era – for Nikola Tesla, not the Tesla roadster.”
Fourth, Hay called for converting 50 percent of the nation’s automobile fleet to plug-in vehicles by the year 2030, which would reduce dramatically America’s oil imports, strengthening both national security and the country’s balance of trade.
Fifth, Hay said the United States should adopt a robust nationwide energy efficiency campaign that strengthens standards for buildings and appliances and provides incentives for homeowners and utilities to invest in energy efficiency.
Sixth, calling coal “too abundant, too domestic and too cheap” for America to abandon it entirely, Hay urged passage of legislation providing substantial research and development support for carbon capture and storage—specifically, the Carbon Capture and Storage Early Deployment Act introduced last year by Rep. Rick Boucher (D-Va.).
And seventh, Hay stressed the need for the country to build more nuclear power plants. “The simple truth is that any effort to combat global climate change will fail without more nuclear plants – the only current source of energy that is abundant and carbon-free,” Hay said. He added that a true nuclear renaissance would rebuild a part of the energy economy in which America once led the world and create thousands of high-tech, high-paying jobs.
To support the transition to a low-carbon future, Hay urged regulators to ensure that utilities remain financially capable of investing in the clean-energy economy. The credit crisis has made it difficult for all but the most creditworthy companies to raise capital, and even they have to pay more, Hay said. “Now more than ever, establishing reasonable returns on equity is essential,” he said. “Utilities cannot afford to suffer credit downgrades. Impatient capital will either find another home, or it will become far more expensive, saddling customers with unnecessary costs.”
The complete text of the speech is available at: http://www.fplgroup.com/news/contents/pdf/NARUCspeech.pdf
FPL Group: Energy Solutions for the Next Era
FPL Group (NYSE: FPL) is a leading clean energy company with 2008 revenues of more than $16 billion, approximately 39,000 megawatts of generating capacity, and more than 15,000 employees in 27 states and Canada. Headquartered in Juno Beach, Fla., FPL Group’s principal subsidiaries are NextEra Energy Resources, LLC, the largest generator in North America of renewable energy from the wind and sun, and Florida Power & Light Company, which serves 4.5 million customer accounts in Florida and is one of the largest rate-regulated electric utilities in the country. Through its subsidiaries, FPL Group collectively operates the third largest U.S. nuclear power generation fleet. For more information about FPL Group companies, visit these Web sites: www.FPLGroup.com, www.NextEraEnergyResources.com, www.FPL.com.