By Patti Epler
The Arizona Guardian
Marc Spitzer is still driving his same old 1997 Jeep. But his eye is on a sweet little electric plug-in hybrid he got to test out in Ohio.
Researchers there are perfecting a battery that can link up with a vehicle somewhere on the grid and deliver power to it on demand, computer-controlled so it uses just what's needed, when it's needed.
The former Arizona state senator and corporation commissioner has spent nearly three years on the Federal Energy Regulatory Commission. But the veteran Republican politician is more convinced than ever that renewable energy sources, alternative energy technology and power-sharing through regional grids need to be a big part of the country's energy future.
Spitzer was appointed to FERC by then-President George W. Bush in 2006. But even as a member of the Arizona Corporation Commission, Spitzer believed in pushing the state's utilities to add more renewable energy sources into the mix. The requirement that 15 percent of a utility's power come from renewables which he helped implement is being challenged in court by the Goldwater Institute, a legal action that irks Spitzer.
Spitzer, a former tax attorney before he ran for Senate from the northwest Phoenix area, was in the Valley earlier this month to talk about energy issues and climate change. He sat down with the Guardian for an interview that ranged from a concentrated history of federal energy legislation and policy to his thoughts on weaning the country from carbon to his new infatuation with the electric car.
So why the 12-year-old Jeep? "It's paid for," he says. "Washington, D.C. is an expensive town."
Q. Is FERC trying to move power generators toward more renewable energy sources? And how difficult is that?
A. The interesting thing about energy politics, as opposed to energy law, is it's not red or blue. It's are you in a low-cost state or a high-cost state? Are you in a coal state or a hydro state or a natural gas state? What is the cost of power in your state? What is the fuel mix in your state?
Arizona is very interesting because it is a microcosm of the United States. Forty-eight, 49 percent of power in the U.S. comes from coal. And there's nuclear at 20 to 25 percent. Natural gas is 20 percent. Renewables is very small. Arizona is similar, like one-third natural gas, one-third coal, one-third nuclear. We've pushed renewables up in Arizona because we think it’s the right thing to do.
One of the things we learned is that gas prices tend to be very volatile. Renewable fuel prices are fixed. The cost of the wind? You know what it's going to be: zero. The cost of the sun for solar power is zero. The cost is all capital as opposed to fuel. Whereas natural gas plants, the capital cost is actually very low but the fuel costs are high. So it's a good thing for a state to have a mix of fuels so you're not at the mercy of a price spike. We became very dependent on natural gas and it became very difficult to site coal plants in the United States because of emissions. And now the people in the U.S. are very concerned about the emissions of power plants.
Q. What's your feeling on climate change and how that's factored in?
A. When I was preparing to run for the Arizona commission, I came to the conclusion that climate change is a serious problem. I was persuaded there was consensus among the scientific community. … I felt that the earth was warming and that we ought to be concerned about it. And that a disproportionate share of the carbon emissions were coming from the generation of electricity. And the greatest culprits were the coal-fired power plants. …
My personal view on this is there should be some legislation to address the issue of climate and carbon, if nothing else then to price carbon so we can send a signal to the utilities and the people proposing to build power plants about what to build. The executives from the utilities for the last two years I've been at FERC have come into to see me and said, "Commissioner we, don't know what to build." … Without the ability to price carbon, people don't know what to build. Should they build a coal plant? Should they build a gas plant? Should they build nuclear plants? Should they put in wind turbines, should they put in solar plants? You cannot survive if you can't price your power. What we need to do is put a price on carbon. And that’s why the utilities as an industry have gone to Congress and come up with a compromise plan that's embodied in the Waxman-Markey bill. (The bill, controversial because of its cap-and-trade provisions, appears to have stalled.) …
But we cannot have blackouts. People of this country and the Congress have said blackouts are not acceptable. We run a risk if we continue to delay in setting forth rules because we have a problem now with "regulatory uncertainty." The power sector of our economy doesn't know what the rules are. And they're waiting for Congress -- and they don't care whether its Republican or Democratic political consensus -- to resolve the issue of power generation.
Q. I'm sure you know that in Arizona when the Corporation Commission required utilities to add renewable to their power mix, the Goldwater Institute sued. Is FERC trying to force renewables too?
A. The state of Arizona is entitled to decide what is in its resource mix. (FERC doesn't dictate the source of power, only the wholesale supply and the distribution of it.) At FERC, we make sure whatever the resource is it can get to market. FERC wants to make sure that the solar and wind people can get on the grid. …
The Goldwater Institute is not consistent because they want markets for education (school choice and vouchers), they want markets for various other issues but apparently they don't want markets for power. They want the utility to have a monopoly. That's fundamentally un-American. The Arizona Corporation Commission, under the state constitution, has the authority for just and reasonable rates for the utilities and they have a mandate to provide reliable electricity at affordable prices for the customers of Arizona, the retail. The state sites the power plants, the commission sites plants. The Goldwater Institute took the position that the Arizona commission had no authority to determine the mix of fuels. That is unsustainable under Article 15 and it didn't take long for the courts to throw them out. Their case is a loser. (Clint) Bolick (the Goldwater attorney) is from New Jersey. He doesn't understand Article 15 of the Arizona Constitution. In law school in New Jersey he missed that, they didn't do that. You know, Barry Goldwater was very pro-solar and very pro-environment. But most important, Barry Goldwater was a true conservative and he believed in the market and he believed in competition and he wanted limited governmental interference in the market. Allowing the utility to be judge, jury and executioner and allowing the incumbent monopoly utility to stifle competition is antithetical to the market.
(Spitzer supported the renewable mix when he was on the commission and still does.) My reasoning was I wanted competition, I believed in renewable energy and that climate change was a serious problem. All those factors combined led me to support it, I think Democrats like it because they like renewable energy and they want to do something about climate change. But I also think there are a lot of Republicans who like renewable energy and want to do something about climate change.
Q. There seems to be a move on the part of some Republican legislative leaders to go to more renewable and green energy projects. They also talk about even expanding nuclear. What would you think about that for Arizona?
A. I don't get to say anymore. But I can tell you globally, from a national perspective, we love renewables. But if we're going to be serious about carbon, we need to supplant the base load generation. Wind generation is intermittent because the wind doesn't always blow. Solar is intermittent because when it's cloudy or its not daylight then there's no solar power, absent storage. So you need base load generation. Hydro power can be base load but if you have a bad hydro year or there's a fish issue up in the Northwest you reduce the hydro power. Nuclear power is zero-emission, base load generation. My personal view is that any solution to climate change has to consider nuclear power.
Q. Do you see the western states and the Pacific Northwest finally going to some sort of regional grid like other parts of the country?
A. We need to show the benefits because people are skeptical. And the state commissions do lose some authority. When I was on the state commission I didn't want to be regulated by the federal government, I wanted to be regulated by me. So I get that. … Progress is being made slowly but surely. I think a federal (power-sharing plan) or carbon legislation will spur it because people will see the economic benefits of inexpensive wind power from the Dakotas going to Chicago. Solar power going into LA. Wind power from Montana going down to Las Vegas.
Q. Your term is up in 2011. Are you hoping to be reappointed? Do you have any plans to come back here to Arizona?
A. Oh boy, I don't know. It's whatever the Spitzer family decides. … I have no plans other than I have a wonderful job. The Arizona commission was a wonderful job. FERC is a wonderful job. It's a great challenge and I'm prepared to do my level best. … You've got plenty of good politicians in Arizona. Obviously, I've got a soft spot for Arizona and want it to succeed.
Last Updated ( Monday, 19 October 2009 04:12 )
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