House Committee on Transportation & Energy (04/24/2013)

Final
STAFF SUMMARY OF MEETING

HOUSE COMMITTEE ON TRANSPORTATION & ENERGY

Date:	04/24/2013	ATTENDANCE

Time:	01:40 PM to 07:39 PM	Buck	X
		Coram	X
Place:	LSB A	Everett	X
		Fischer	X
This Meeting was called to order by		Kraft-Tharp	X
	Representative Tyler	Lawrence	X
		Lee	X
This Report was prepared by		Mitsch Bush	X
	Kelli Kelty	Peniston	X
		Primavera	X
		Scott	*
		Moreno	*
		Tyler	X
		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
SB13-202 SB13-252		Referred to Appropriations Referred to the Committee of the Whole

01:40 PM -- Senate Bill 13-202

Representative Tyler, chair, called the meeting to order. A quorum was present. Representative Tyler discussed the schedule for the day and stated that testimony for Senate Bill 13-252 would be limited to 1.5 hours for each side. Representative Singer, prime sponsor, presented Senate Bill 13-202. The reengrossed bill requires the Colorado Oil and Gas Conservation Commission (COGCC) in the Department of Natural Resources (DNR) to report to the Joint Budget Committee and House and Senate committees of reference with jurisdiction over energy by February 1, 2014, on utilizing a risk-based strategy for inspecting oil and gas locations that targets operational phases that are most likely to experience spills, excess emissions, and other types of violations. The report is to include findings, recommendations, and a plan, including staffing and equipment needs for implementing the strategy. The bill requires implementation of a strategy by July 1, 2014, which may include a pilot project to test the strategy. The reporting requirement is repealed September 1, 2014. Representative Singer discussed the provisions of the bill. Representative Mitsch Bush asked about the fiscal note.

The following people testified on the bill:

01:46 PM -- Mr. Bob Randall, representing DNR, testified in support of the bill. He said that the bill will add rigor and predictability to the commission's enforcement and inspection process. Representative Coram asked if the bill instructs the department to do what it is already doing. Mr. Randall responded that the bill calls for development of a specific written strategy.

01:49 PM -- Mr. Jim Cole, representing the Colorado Oil & Gas Association (COGA), testified in support of the bill. He said that the bill adds a layer of accountability to the inspection process.

01:52 PM -- Mr. Stan Dempsey, representing the Colorado Petroleum Association (CPA), testified on the bill. He said that CPA is neutral on the bill now, after having been in strong opposition to the bill when it was heard in the Senate. He said that the bill in its current form is a reasonable approach.

01:55 PM

Representative Singer presented closing comments on the bill.


BILL:	SB13-202
TIME:	01:56:00 PM
MOVED:	Fischer
MOTION:	Refer Senate Bill 13-202 to the Committee on Appropriations. The motion passed on a vote of 8-5.
SECONDED:	Kraft-Tharp
		VOTE
	Buck	No
	Coram	No
	Everett	No
	Fischer	Yes
	Kraft-Tharp	Yes
	Lawrence	No
	Lee	Yes
	Mitsch Bush	Yes
	Peniston	Yes
	Primavera	Yes
	Scott	No
	Moreno	Yes
	Tyler	Yes

Final YES: 8 NO: 5 EXC: 0 ABS: 0 FINAL ACTION: PASS

01:57 PM -- Senate Bill 13-252

Representatives Ferrandino and Duran, prime sponsors, presented Senate Bill 13-252. The reengrossed bill makes several changes to Colorado's renewable electricity standard (RES). Specifically, the bill expands the definition of eligible energy resources that may be used to comply with the standard to include coal mine methane and synthetic gas produced by pyrolysis of municipal solid waste. This expansion is subject to a determination by the Colorado Public Utilities Commission (PUC) that the production and use of these gases to generate electricity will not result in a net increase in greenhouse gas emissions. The bill also increases from 10 to 25 percent the share of retail electricity sales that must be achieved from eligible energy resources by cooperative electric associations (CEAs) serving more than 100,000 meters, beginning in the year 2020. In addition, the allowable retail rate impact for CEAs is raised from 1 percent to a maximum of 2 percent.

Generation and transmission (G&T) CEAs providing wholesale electricity to CEAs in Colorado are also subject to this increased standard and retail rate impact rule, beginning in 2020. G&T CEAs may take credit for energy generated from eligible resources by its Colorado members. The bill specifies that if the purchase of energy generated from eligible resources by a Colorado member CEA would cause an increase in rates exceeding the 2 percent retail rate impact rule, the obligation of the wholesale utility is reduced by the energy necessary to allow compliance by the member with the rule. G&T CEAs must report annually to the PUC on standard compliance. For CEAs serving fewer than 100,000 meters, the bill adds a distributed generation requirement of 1 percent of total electricity sales. For purposes of compliance with the 25 percent standard, the bill authorizes a 3 kilowatt-hour multiplier for solar generation. The bill eliminates:

• in-state preferences for wholesale distributed generation;
• the in-state requirement for the "community-based project" 1.5 kilowatt-hour multiplier; and
• the 1.25 kilowatt-hour multiplier for eligible energy resources beginning operation on or after January 1, 2015.

Speaker Ferrandino discussed the provisions of the bill. Representative Duran discussed the intent of the bill and said that the bill is about creating new jobs and spreading opportunities and benefits of clean energy across the state. She commented on the cost argument brought forward by opponents to the bill. Representative Coram commented on the adverse impact of the bill in rural Colorado and asked if there has been an economic study to rural Colorado by the loss of renewable energy jobs. Discussion ensued concerning the 2 percent rate cap under the bill. Representative Buck asked if a mandate is necessary. Discussion ensued concerning REAs and why a mandate should or should not be in place.

02:24 PM

Representative Primavera commented on job creation as a result of the bill. The sponsors commented on how the bill will create jobs and provide stability. Representative Tyler asked where wind farms are located in Colorado.

02:28 PM

Representative Scott asked why the bill has to be funded by ratepayers. Representative Lawrence asked if REAs were consulted during the drafting of the bill. Speaker Ferrandino said that Tri-State was involved before the bill was introduced. Representative Tyler noted that he is running a bill that is currently on bill paper and that the REAs were included and asked for recommendations but they did not provide any feedback or recommendations on the bill. Discussion ensued concerning the stakeholder process.

02:35 PM

Representative Coram asked about job potential in his district. Discussion ensued concerning access to clean water and clean air.

The following people testified on the bill:

02:40 PM -- Mr. John Neilson and Mr. Bruce Driver, representing Western Resource Advocates, testified in support of the bill. Mr. Neilson said that the bill will encourage economic development in rural parts of the state. Mr. Driver responded to questions from the committee concerning costs incurred under the bill.

02:52 PM

Representative Duran commented on questions raised by the committee.

02:53 PM -- Director Doug Dean, representing the PUC, and Mr. Tom Hunt, representing the Colorado Energy Office (CEO), testified in support of the bill. Director Dean said that PUC has no position on increasing renewable energy standards but is supportive of parts of the bill addressing eliminating the multiplier of in-state resources. He commented on the retail rate impact in the bill. Mr. Tom Hunt expressed CEO's support of the bill and said that it encourages development and resources in rural Colorado. Speaker Dean responded to questions from the committee concerning the two-percent cap. Representative Coram asked about solar energy compared to natural gas and who will pay the cost of solar energy used in Western Colorado. Discussion ensued concerning the rate cap. Representative Mitsch Bush asked about distributed generation. Representative Scott asked for clarification concerning the authority of the PUC over the rate caps.

03:10 PM -- Mr. Mark Stacy, representing the Iberdrolan Renewables, testified in support of the bill. He said that renewable energy projects bring economic activity and jobs to the states that host them. Ms. Ann Giovonetto, representing RES Americas, testified in support of the bill. Ms. Susan Innis, representing VESTAS, testified in support of the bill. The panel responded to questions from the committee concerning renewable energy and utility costs. Discussion ensued concerning taxes that are paid by the renewable energy community in Colorado.
03:31 PM -- Mr. Jeff Berman, representing himself, testified in support of the bill. He commented that renewable energies can be a cost-saving measure. Mr. Steve Szabo, representing himself, testified in support of the bill. He commented on coal burning and stressed the importance of moving toward renewable energy. Ms. Liz McIntyre, representing herself, testified in support of the bill. The panel responded to questions from the committee.
03:44 PM -- Ms. Dianna Reams, representing testified in opposition to the bill. Handouts were distributed to the committee (Attachments A and B).

130424 AttachA.pdf

130424 AttachB.pdf

03:49 PM -- Mr. James Taylor, representing the Heartland Institute, testified in opposition to the bill. Mr. Taylor responded to questions from the committee concerning rates.

03:56 PM -- Ms. Susan Holland, representing Emerald Mountain Energy Inc., testified in support of the bill. Mr. Mike Bowman, representing himself, testified in support of the bill. Commissioner Liane "Buffie" McFayden, representing the Pueblo Board of County Commissioners, testified in support of the board. The panel responded to questions from the committee.

04:10 PM -- Mr. Rod Flores, representing Creative Energy Systems, testified in support of the bill. Mr. Tom Vessels, representing Vessels Coal Gas, testified in support of the bill. A handout was distributed to the committee (Attachment C).

130424 AttachC.pdf

04:20 PM -- Mr. Tom Darin, representing Averian Wind Energy, testified in support of the bill. Mr. Mark Detsky, representing the Colorado Independent Association, testified in support of the bill. Mr. Taylor Henderson, representing the Dow Chemical Company, testified in support of the bill. Mr. Charles Newcomb, representing Endurance Wind Power, testified in support of the bill.

04:27 PM -- Mr. Edward Stern, representing CO Solar Energy Industry Assoc, testified in support of the bill. Mr. TJ Slocum, representing SEIA, testified in support of the bill. Mr. Justin Penelute, representing Syndicated Solar, testified in support of the bill. Mr. Chris Votoupal, representing Colorado Cleantech Industry Association, testified in support of the bill.

04:40 PM -- Doug Carter, representing citizens, testified in support of the bill. Korey Christ-Janer, representing herself, testified in support of the bill. Leslie Glustrom, representing Clean Energy Action, testified in support of the bill. Handouts were distributed to the committee (Attachments D and E).

130424 AttachD.pdf

130424 AttachE.pdf

04:49 PM

Chair called a brief recess.

04:57 PM

The committee came back to order.

04:58 PM -- Mr. Rick Gordon, representing Tri-State, testified in opposition to the bill. Mr. Ken Anderson, representing Tri-State, testified in opposition to the bill. The panel responded to questions from the committee concerning their opposition to the bill.

05:18 PM -- Mr. Patrick Mooney, representing Intermountain Rural Electric Association (REA), testified in opposition to the bill. Mr. Mooney responded to questions from the committee.

05:29 PM -- Mr. Kent Singer, representing the Colorado Rural REA, testified in opposition to the bill. Mr. Singer responded to questions from the committee.

05:40 PM -- Mr. Don Shawcroft, representing the Colorado Farm Bureau, testified in opposition to the bill. Mr. Shawcroft responded to questions from the committee.

05:50 PM -- Mr. Tom Sifers, representing the Colorado Association of School Boards, testified in opposition to the bill. Mr. Dale McCall, representing the Colorado Rural School Caucus, testified in opposition to the bill.

05:57 PM -- Mr. Ron Asche and Mr. Troy Whitmore, representing United Power, testified in opposition to the bill. Mr. Troy Whitmore, representing United Power , testified in opposition to the bill.

06:05 PM -- Mr. Brad Gaskill, representing Poudre Valley REA, testified in opposition to the bill. Mr. Ken Weaver, representing Walker Manufacturing Company, testified in opposition to the bill.

06:11 PM -- Mr. Mike McBride and Mr. Dan McDonough, representing Gunnison County Electric Association, testified in opposition to the bill.

06:18 PM -- Mr. Timio Archuleta and Mr. Sean Mcarville, representing IBEW III, testified in opposition to the bill.

06:24 PM -- Ms. Tamra Ward, representing Colorado Concern, testified in opposition to the bill. Ms. Carly West, representing CACI, testified in opposition to the bill.

06:26 PM -- Mr. and Mrs. Frank and Kerry Moe, representing themselves, testified in opposition to the bill.

06:41 PM -- Mr. Andy Karsian, representing Colorado Counties Inc., testified in opposition to the bill.

06:42 PM -- Ms. Sara Cassidy, representing Union Pacific Railroad, testified in opposition to the bill. Mr. Carl Smith, representing the Brotherhood of Locomotive Engineers, testified in opposition to the bill. A handout was distributed to the committee (Attachment F).

130424 AttachF.pdf

06:47 PM -- Ms. Dianna Orf, representing the Assoc Govt NW Colorado, testified in opposition to the bill.

06:50 PM -- Mr. William Yeatman, representing the Independence Institute, testified in opposition to the bill.

06:52 PM -- Mr. Bruce Gerk, representing HEA Membership, testified in opposition to the bill. Mr. Mark Farnsworth, representing Highline Electric Association, testified in opposition to the bill.

07:00 PM -- Mr. Terry Hall, representing Y-W Electric Association, testified in opposition to the bill. Mr. Hall responded to questions from the committee.

07:03 PM -- Mr. Barry Springer, representing Mountain View Electric Association, testified in opposition to the bill.

07:06 PM -- Ms. Ginny Buczetc, representing United Power, testified in opposition to the bill. Mr. Stuart Travis, representing YW Electric Association, testified in opposition to the bill. Mr. Bill Midcap, representing the Rocky Mountain Farmers Union, testified in opposition to the bill and distributed a handout to the committee (Attachment G).

130424 AttachG.pdf

07:16 PM -- Mr. Brian McCormick, representing United Power, testified in opposition to the bill.


BILL:	SB13-252
TIME:	07:17:46 PM
MOVED:	Coram
MOTION:	Adopt amendment L.031 (Attachment H). The motion failed on a vote of 5-8.
SECONDED:	Scott
		VOTE
	Buck	Yes
	Coram	Yes
	Everett	Yes
	Fischer	No
	Kraft-Tharp	No
	Lawrence	Yes
	Lee	No
	Mitsch Bush	No
	Peniston	No
	Primavera	No
	Scott	Yes
	Moreno	No
	Tyler	No

YES: 5 NO: 8 EXC: 0 ABS: 0 FINAL ACTION: FAIL

130424 AttachH.pdf


BILL:	SB13-252
TIME:	07:23:54 PM
MOVED:	Lawrence
MOTION:	Adopt amendment L.032 (Attachment I). The motion failed on a vote of 3-10.
SECONDED:	Scott
		VOTE
	Buck	No
	Coram	Yes
	Everett	No
	Fischer	No
	Kraft-Tharp	No
	Lawrence	Yes
	Lee	No
	Mitsch Bush	No
	Peniston	No
	Primavera	No
	Scott	Yes
	Moreno	No
	Tyler	No

YES: 3 NO: 10 EXC: 0 ABS: 0 FINAL ACTION: FAIL

130424 AttachI.pdf


BILL:	SB13-252
TIME:	07:27:19 PM
MOVED:	Lawrence
MOTION:	Adopt amendment L.033 (Attachment J). The motion failed on a vote of 4-9.
SECONDED:	Scott
		VOTE
	Buck	No
	Coram	Yes
	Everett	Yes
	Fischer	No
	Kraft-Tharp	No
	Lawrence	Yes
	Lee	No
	Mitsch Bush	No
	Peniston	No
	Primavera	No
	Scott	Yes
	Moreno	No
	Tyler	No

YES: 4 NO: 9 EXC: 0 ABS: 0 FINAL ACTION: FAIL

130424 AttachJ.pdf


BILL:	SB13-252
TIME:	07:29:40 PM
MOVED:	Fischer
MOTION:	Refer Senate Bill 13-252 to the Committee of the Whole. The motion passed on a vote of 8-5.
SECONDED:	Kraft-Tharp
		VOTE
	Buck	No
	Coram	No
	Everett	No
	Fischer	Yes
	Kraft-Tharp	Yes
	Lawrence	No
	Lee	Yes
	Mitsch Bush	Yes
	Peniston	Yes
	Primavera	Yes
	Scott	No
	Moreno	Yes
	Tyler	Yes

Final YES: 8 NO: 5 EXC: 0 ABS: 0 FINAL ACTION: PASS

07:39 PM

The committee adjourned.