Will Result in Higher Electric Rates, Less Renewable Power
(October 23, 2008) An unlikely coalition of renewable power providers, environmentalists, business organizations, consumer groups, taxpayer groups, utilities, organized labor, the Democratic and Republican parties and virtually every major newspaper in the state has come together in opposition to Proposition 7, one of two energy measures on California’s November ballot.
The California Chamber of Commerce is one of more than 300 organizations opposed to Proposition 7.
Proposition 7 proponents claim the measure will increase renewable energy in California. Renewable power providers and environmental organizations, however, oppose Proposition 7 and warn the initiative is so flawed that it will result in less, not more, renewable power and will significantly increase electric rates.
The CalChamber Board of Directors voted at its May 21 quarterly meeting to oppose the measure due to its potential to substantially drive up energy prices in the state.
Electric Rate Increases
Proposition 7 would raise electric rates specifically because it:
- Contains bureaucratic changes that will lead to red tape, lawsuits and delays that will slam the brakes on renewable power development in California.
- Will force small wind and solar companies out of the market via a “competition elimination” provision that excludes renewable plants that produce less than 30 megawatts from counting toward the new targets.
- Contains a provision that forces electricity consumers to pay 10 percent above market rates for renewable power forever—even when the costs of solar and wind sources become more competitive. Economists warn electricity bills will increase by hundreds of millions of dollars per year.
Solar/Wind Companies Oppose
Opposition to Proposition 7 includes companies that stand to benefit from increased renewable energy requirements —California’s wind, solar and renewable power providers.
Environmental groups also oppose the initiative because it will set California’s renewable energy industry backward.
Jan Smutny-Jones, executive director of the California Independent Energy Producers Association, which represents companies that produce more than 80 percent of the renewable power delivered in California said,
“Anyone who knows how the renewable power market works knows this poorly written measure will erect new barriers that will lead to less, not more, renewable power. It’s telling that the very companies who stand to benefit from more renewable energy are all opposing Prop. 7.”
Sue Kateley, executive director of California Solar Energy Industries Association, warns, “Proposition 7 would devastate California’s small solar businesses by forcing us out of the market—eliminating a major source of clean power and thousands of jobs.”
In addition, more than 25 of the state’s leading newspaper editorial boards are recommending “No” on Proposition 7. As of the Alert’s publishing deadline, no daily newspaper had come out in support of the initiative.
Business groups opposing Proposition 7, in addition to the CalChamber, include the California Small Business Association, California Manufacturers & Technology Association, California Black Chamber of Commerce, California Hispanic Chambers of Commerce and more than 100 local chambers of commerce and business groups.
Business opponents note that Proposition 7 will hurt the economy and lead to the loss of tens of thousands of jobs.
More Information
More information about Proposition 7 is available at the No on 7 website, www.NoProp7.com.
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