Green pricing offers power options
- Published: May 22, 2008
Yellow Springs residents will soon have the opportunity to ensure that the cost of their share of household energy use goes to supporting renewable power sources like the sun, wind, waterways and landfill gas. Village Council on Monday, May 19, agreed to initiate a new “green pricing” program that will offer residents the option of paying for the renewable energy production equivalent to their household power consumption. In other words, by paying a little extra on their utility bill, residents can support the production of green energy and reduce demand for fossil fuels to supply the country’s power grid.
The green pricing program allows Yellow Springs utility consumers to purchase renewable energy credits (RECs) equivalent to the amount of kilowatt hours of electricity they consume each month. While all energy consumers are using the mix of renewable and non-renewable energy available on the power grid at any given moment, green pricing participants will be paying only for the renewable sources. According to Julia Blankenship, who directs the AMP-Ohio program that will administer green pricing for Yellow Springs, green pricing participants are thereby investing only in renewable energy.
“Essentially, what you’re doing is purchasing the environmental benefits of that green product and recycling the dollars into green energy projects, which theoretically reduces the cost of producing that energy,” Blankenship said.
RECs for green energy are a little more expensive than conventional power from coal, nuclear and other non-renewable sources, according to Chad Runyon, a member of the Village Environmental Commission, which is promoting the green pricing program. The average household consumes 750 to 1,000 kilowatt hours of electricity per month, according to Blankenship, which results in a utility bill of $60 to $75, according to Village utility rates. With an additional 1.5 cents per kilowatt-hour for AMP-Ohio’s green energy, which adds an additional $11.25 to $15, green pricing would cost a household using 750 to 1,000 kWh/month a total between $71.25 to $85.
AMP-Ohio sells all of its RECs through Nature’s Energy program run by Green Mountain Energy, a Texas-based power provider, Blankenship said. Every REC the cooperative municipal energy provider sells represents one megawatt hour of electricity that was generated by an approved renewable energy resource. Currently AMP-Ohio owns several renewable projects including Belleville hydroelectric, which produces 250,000 megawatt hours of power per year; several landfill gas projects which produce about 80,000 MWh a year; and the Bowling Green wind project which generates 14,000 MWh/year, AMP spokesman Kent Carson said last week. The Village currently participates in both the hydro and the landfill gas projects.
Each REC AMP-Ohio sells gets invested back into these wind, hydro and landfill gas projects as well as others currently being investigated and built to produce renewable energy in Ohio, Carson said.
“RECs lower the cost of renewable energy projects, which can be reinvested into more projects,” Blankenship said. “And it’s putting a value on the environmental benefits of creating green energy.”
For current AMP members, there isn’t as much demand for green energy as there is renewable energy generated. For instance, the combined output of all of AMP’s renewable energy projects yield a lot more green energy (about 344,000 MWh a year) than the approximately 1,100 consumers signed up for green pricing demand, Carson said.
In order to begin the green pricing program, Yellow Springs Village Council agreed last year that the village needed a minimum participation level of 10 percent of Village utility consumers. But with 140 households already signed up, Council asked Village Manager Eric Swansen to take the steps necessary to initiate the program.
With 10 percent participation, the village would have a higher rate of commitment than even the Bowling Green community with four percent committed to buying green energy, Blankenship said. Yet even if everyone in Yellow Springs signed up, the Village, which sold 34.5 million kilowatt hours (or 34,500 megawatt hours) of electricity to residents in 2006, would use only a small fraction of the green power available. Currently, AMP sells its excess RECs on the market. That means, said Carson, that “there’s room to grow” more green energy buyers.
The Environment Commission has been working to promote green pricing because members such as Chad Runyon feel it is a good opportunity to invest in future renewables.
“I like it because it gives me peace of mind, and even though I know we’re still using coal, it forces AMP-Ohio to bring in more renewables,” Runyon said. “It’s just like supporting any product where some of the money goes to research and development of that product.”
Last month’s Village utility bill included a brief explanation of the green pricing program and a way to sign up for it. The program is optional, and administered on an individual basis, so that only customers who wish to participate will pay the extra cost, while those who do not sign up can continue at conventional Village utility rates. And because most of the details of the program are administered through AMP-Ohio, once the program gets going, additional work for the Village will be minimal, Blankenship said.
Green pricing is also available for commercial customers, whose power would be purchased in one-megawatt blocks at $15 per megawatt of power, with a variation on that formula for smaller businesses, Blankenship said.
Green pricing programs which allow RECs to be sold on the market support and in some cases are a key justification for renewable energy projects. “If there was no REC market, there would be a lot fewer renewable energy projects in Ohio,” she said. “A key aspect of making these projects possible are in their future investments.”
To sign up for green pricing in Yellow Springs, contact the Village utility office at 767-7202.