Guest essay by Eric Worrall
h/t JoNova; Al Gore might be happy to encourage towns like Georgetown to go renewable, but so far he is not offering to pay anyones grossly inflated green electricity bills.
How 100% renewables backfired on a Texas town
Edward Klump, E&E News reporter
Energywire: Monday, November 4, 2019
An inconvenient truth is hanging over Georgetown, Texas: Its celebrated shift to renewable energy doesn’t look like a national model these days.
Electric rates are up. Critics are blasting the costs. And the city north of Austin is trying to figure out how to mitigate the situation.
Georgetown, whose green push gained global attention thanks to former Vice President Al Gore and others, can claim to have 100% renewable power thanks to a credit system tied to electricity purchases. In 2018, the city bought enough power from wind and solar projects to account for all of the community’s consumption. It also pays for power fueled by natural gas.
In all, the city contracts for more electricity than its municipal utility needs to serve customers — and that’s been a problem. Surplus power is sold into a market hampered by weak prices, often delivering financial losses instead of the returns Georgetown expected.
“It’s unfortunate that the Georgetown experiment went so quickly from being a success story to being something of a cautionary example,” said Adrian Shelley, director of the Texas office of Public Citizen, a consumer advocacy group.
Georgetown declined to discuss many of the details of its renewable contracts, but said on its website that the city “is still obligated to pay the price for energy we secured in our contracts” when the price of energy decreases. It also talked about looking to change its ongoing financial obligations related to energy contracts.
Georgetown recently filed suit against Buckthorn Westex LLC, an affiliate of Clearway Energy Inc. The city is seeking the cancellation of a solar contract over the alleged nondisclosure of information about the expected performance of the facility. In a statement, Buckthorn said it “strongly disputes all claims in the complaint made by the City of Georgetown.”
“Buckthorn has and will continue to honor all terms of its contractual agreement with the City and any claims to the contrary are inaccurate,” the company said.
The monthly bill for an average home in Georgetown that uses 1,000 kWh per month climbed about 22% to $144.35 in 2019 compared with 2018, according to the city. Much of that jump, though not all of it, is related to a higher power cost adjustment.
…Read more: https://www.eenews.net/stories/1061456081
My question – why do renewable energy providers need contracts with lock-in clauses?
Climate advocates regularly assure us that renewable energy is cheaper than coal, yet green energy fans like the Mayor of Georgetown seem to feel an obligation to sign long term contracts to purchase renewable energy, with no clawback option if the price of that renewable energy is significantly higher than the prevailing electricity spot price.
Perhaps Georgetown voters should consider this paradox at the next city election.