Regulation isn’t popular in Wyoming. People here believe in the free market and the right to make the choices that are best for them, without government interference or hindrance.
That’s why a bill proposed by six state lawmakers is so baffling. The measure – Senate File 71 – would penalize utilities that use wind or solar energy to produce power for Wyomingites.
The bill would allow only six resources, including coal and natural gas, to be used as utilities generate power for Wyomingites. Wind and solar aren’t on that list, which means the measure would amount to a tax on certain kinds of power. Utilities would have to be 100 percent compliant by 2019.
The bill is fundamentally problematic. Energy markets are changing. To encourage its signature industry, Wyoming should be seeking to level the playing field so that all sectors have a fair chance to succeed. Why would it try to drag down solar and wind, two potentially successful industries that could make a home in the state?
True, the state wouldn’t draw as much revenue from those industries under its current tax structure as it would from more traditional energy sources, such as oil and gas. But that’s a problem with the tax structure, not with solar or wind. Wyoming legislators should focus on attracting more businesses to the state and taxing them equitably, not on shutting out potential sources of revenue.
The measure would seem to give an advantage to traditional fuels. But that boost wouldn’t actually add up to much. The majority of the power produced in Wyoming leaves the state anyway, so it wouldn’t be subject to this penalty. The measure would also be difficult to implement and enforce.
The bill amounts to protectionism, and it doesn’t have the best interests of all Wyomingites in mind. Sources of electricity should have to compete to be the best choice. Utilities, in turn, should be free to choose the cheapest sources to keep rates low for their customers. This shortsighted bill could very easily force Wyomingites to pay more for their power.
The measure would also ensure that Wyoming was out of step with many other states. Almost 30 – including both red and blue states — have standards for their renewable energy portfolios. To move in this direction would be to move against a national trend – one set by some of Wyoming’s energy customers.
The skepticism from experts in the state is hard to look past, too. “We would want markets to be unfettered and vendors to have access to the cheapest best sources of the things they are selling,” Chuck Mason, an economist at the University of Wyoming’s Center for Energy Economics and Public Policy, told the Star-Tribune.
He wasn’t alone. “Certainly this will not ensure Wyoming rates are as low as possible – it amounts to an attempted indirect subsidy of traditional sources regardless of the cost of renewables,” emailed Rob Godby, the center’s director.
Wyoming legislators are trying to solve the wrong problem. The tax structure, not the market, needs adjusting. To think this state legislation can effectively manipulate national energy markets is nonsense. The Legislature should focus on strategically addressing the budget gap and adjusting Wyoming’s tax structure — the real issues that are facing the state.