Wednesday, Aug. 20, 2008

O'Malley touts county program in energy speech

Governor promotes new generation, renewables

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OCEAN CITY — Gov. Martin O'Malley touted Montgomery County's commitment to purchasing renewable energy in recent years and said at the annual Maryland Association of Counties summer conference that the state has formed a partnership to strengthen its efforts to procure more alternative power.

The state will pool resources with Montgomery County, Baltimore city and the University of Maryland to leverage its purchasing power in securing clean energy projects.

In his 28-minute speech before several hundred county officials, the pledge for more renewables drew the only interruption for applause.

"We believe that we can make our state the national leader in renewable energy, and we plan to move forward toward making our state one of the very first in the nation to use its market power to jumpstart large-scale commercial renewable energy projects," he said.

The state last week formally offered to purchase hundreds of megawatts of electricity from renewable energy needs, he said. "By offering long-term contracts for clean, renewable power, we can accelerate the arrival of more commercial-scale projects like Delaware's offshore wind farm or proposals for an Eastern Shore power plant that's powered by poultry litter."

The partnership between state and local governments and non-governmental institutions is the first of its kind, Maryland Energy Administration Director Malcolm D. Woolf said.

The state now is looking to purchase about 200 megawatts of power, which would be enough to power 200,000 homes annually, Woolf said. It will likely cost more up front than buying traditional electricity, he said, but the security of long-term renewable power contracts will pay dividends in the volatile commodities marketplace.

"We know that coal and natural gas are global commodities where the price can go up," Woolf said. "The sun always shines, and the wind always blows. The cost of renewable energy does not go up."

Montgomery County buys at least 10 percent of its energy needs from renewable sources.

The long-term savings is worth the higher upfront cost, said Eric Coffman, senior energy planner for the county's Department of Environmental Protection. "We're actually paying a premium for that clean energy supply," he said. "We're doing it for environmental greenhouse gas reduction."

Pooling their resources should enable the state to get lower rates, he said. "The main goal for us is working with the state to get a long-term clean energy supply at very favorable rates to the county governments and the state, because going just on our own, we don't have the purchasing power that the state does."

In addition to renewables, Maryland must embrace new generation opportunities and promote the use of "smart meters" that reduce consumption to secure its energy future, O'Malley said.

Newly appointed Public Service Commission Chairman Douglas R.M. Nazarian said his agency will strive to put the governor's ideas into practice. "We are going to take control of our own destiny, our own future and … we are not going to sit back and let the markets solve the problems that we identify."

However, Sen. E.J. Pipkin, a leading voice on utility issues in the General Assembly, said government's role should be restricted. He opposed O'Malley's plan to have the state assist local governments build "peaking plants," which produce electricity when the demand for power is greatest. One such project is under consideration in Thurmont.

"Creating a new agency involvement in direct building of power plants is not something that I think is constructive. I think the private market does have a place in the system and I think that's one proposal that I had some problems with," said Pipkin (R-Dist. 36) of Elkton.

The governor's speech was largely on target, said Robert L. Gould, a Constellation spokesman.

"The governor clearly appreciates the fact that there are no easy solutions and that we must look at many alternatives to meet our future energy needs," he said in a statement.