Those getting in on the ground floor of renewable energy stand to reap future benefits. Kentucky, unfortunately, is positioning itself to be a loser.
As the Public Service Commission recently said, in its 2-1 rejection of a good deal on wind power from Illinois: "There is no mandate at this time for utilities in Kentucky to supply renewable energy."
The dissenting commissioner, James W. Gardner, made a strong case that Kentucky Power's proposed wind contract would have satisfied state law's requirement that regulated utilities go with the least-cost option.
In his dissent, he noted that Kentucky Power, a subsidiary of American Electric Power, has been purchasing more than 3,000 megawatt hours of electricity on average in recent years to satisfy peak demand and has been paying almost $45 per megawatt hour for it.
The cost of the wind power would have been $43 per megawatt hour, guaranteed for 20 years.
Gardner noted that the price from Florida Power & Light's Illinois Wind was substantially lower than other wind-power bids and that a better price is unlikely because a federal tax credit is expiring.
Also, he wrote, there's a need for the power. "As my colleagues recognize, there are great pressures nationally and in Kentucky to increase renewables. After listening to nearly 100 Kentucky Power ratepayers at three public meetings, I worry about the future costs of electricity to these ratepayers.
"This contract would have been a very small piece of Kentucky Power's portfolio (less than 5 percent). ... I am concerned that ratepayers in a state like Kentucky with no nuclear power, and little potential for in-state renewables (other than biomass), will be facing large rate increases."
Gardner is excessively pessimistic about the potential for renewables in Kentucky. Germany has winters that are just as gloomy as ours, yet is a solar power leader.
Gardner is right, though, to be worried about future energy costs in Kentucky because of our overreliance on coal and the high economic and environmental costs of building coal-fired power plants.
Attorney General Jack Conway and Kentucky Industrial Utility Customers also opposed the wind contract. They argued that, most of the year, Kentucky Power has excess generating capacity and, that as long as there is no requirement for renewable energy, the wind power would be a discretionary expense that consumers can't afford.
The AG, the industrial customers and PSC members David Armstrong and Charles Borders might be correct in their reading of state law.
But as public policy, continuing to put all our energy eggs in the coal basket is short-sighted and reckless.
Several times now the General Assembly has failed to act on legislation requiring utilities to gradually increase the percent of power coming from renewable sources and to improve energy efficiency.
Twenty-nine states and the District of Columbia have adopted renewable energy mandates; some others have voluntary standards. Kentucky's coal-loving legislature just somehow hasn't gotten around to it.
Meanwhile in Washington, energy legislation has stalled in the Senate, where President Barack Obama is trying to revive it.
Gardner said that everyone shares the goal of having reasonably priced electricity but there will continue to be disagreements about how to get there without "clear direction from the elected representatives" of the U.S. and Kentucky.
The longer it takes to get that clear direction, the worse off we'll be.