guidelines exist for Utah in the laws of other states in the deregulation process. She stated that it is
important to assure by law that no supplier of electricity is enable to undersell competitors because
of weaker environmental practices. She noted that most states are providing green energy options
for their consumers which is an important way to enlist the help of citizens in preserving air clean
enough to breathe safely and the more conservation and renewable energy sources are emphasized,
the less fossil fuel burning will take place as utilities attempt to provide the energy necessary to
supply Utah's rapidly expanding population. She told the task force that the Coalition would request
that a task force hearing be rescheduled on environmental issues and their legislative resolutions.
Ms. Nina Dougherty, Utah Chapter, Sierra Club, distributed a "Report of the Grand Canyon
Visibility Transport Commission to the United States Environmental Protection Agency and a letter
from Governor Leavitt to Carol M. Browner, Administrator, U.S. Environmental Protection Agency.
She pointed out that provisions in electric utility deregulation laws and regulations are needed to
ensure: 1) that there are comparable emissions standards for all electric-generating facilities,
regardless of age; 2) that there are milestones and mechanisms for increasing the use of clean and
renewable energy resources; and 3) that there are milestones and mechanisms for increasing
efficiency in the end use of energy.
Mr. Bruce Driver, Land and Water Fund of the Rockies, urged the task force to include three
specific recommendations in its final report to the Legislature: 1) resource decisions by the industry
can have significant environmental impacts; 2) investments in renewable resources and energy
efficiency should be encouraged to help the industry minimize its impact on the environment; and
3) measures should be adopted to ensure that competition will not harm, but will expand investment
in clean power resources. He urged the Legislature to further study green marketing, systems benefit
charges, renewable resource portfolio standards, and other measures designed to encourage the
industry to play its part in maintaining and enhancing Utah's environment.
Mr. Jeff Burks, Office of Energy and Resource Planning, urged the task force to consider
how programs and policies should be reevaluated for energy efficiency and renewable energy as it
moves to a deregulated electric industry. He stated that these policies and programs were designed
in a regulated market and may no longer, in their present form, be relevant as the state moves to a
restructured competitive electricity market. He suggested five guiding principals that should be
considered and made part of the task force's final report: 1) the Legislature should create an industry
structure that promotes competition in the provision of electricity supply and the provision of retail
energy services to customers; 2) informed customers and suppliers are an essential ingredient of
efficiently operating competitive markets; 3) policies, programs, and institutions created to promote
energy efficiency and renewable energy during the transition should adopt market-based incentives
and transformation strategies that directly target specific market barriers and attempt to create lasting
structural or behavioral changes; 4) mechanisms for programs to fund energy efficiency and
renewable energy during a defined transition period should be broad based, nonbypassable,
competitively neutral, and small in proportion to total system revenues; and 5) an independent third
party should be established to manage energy efficiency and renewable energy market
transformation activities. He stated that market barriers will continue to be prevalent in the transition
to competitive utility markets and it is critical that the Legislature and regulators continue to support
these programs.
Task force discussion followed.
3. Task Force Consideration and Approval of Final Report - The task force reviewed the proposed draft task force report and considered changes to the draft. Changes adopted by the task
force include:
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replacing the word "stranded" with the word "transition" throughout the report;
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deleting "Although supportive of retail competition in the electric industry when conditions are appropriate" on line 1 in the Executive Summary and inserting "until
conditions are appropriate" after the word "premature" on line 3;
*
deleting "although not comprehensive" on page 2, paragraph 2, of the General Background;
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including the chart on page 3, which shows the residential, commercial, and industrial costs, in the appendix;
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inserting the word "generally" in the bold face on page 4, third paragraph of the General Background after the words "cooperatives are";
*
after the words "own rates" inserting "with certain limitations"; and after the words "cooperatives are" insert the word "otherwise.";
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deleting "will appear" after the words "voter-initiated measures" and after the words "restructuring legislation" inserting "failed" in the fourth paragraph on page 4 of the
General Background;
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adding a sentence to the fourth paragraph on page 6 of the General Background which reads "Potential risks to these smaller consumers include higher prices, decreased
reliability, and degraded customer service.";
*
inserting the word "Geographic" before the word "aggregation" under the third bullet on page six and adding a sentence at the end of the bullet which reads: "Geographic
aggregation may also limit the choices available to customers.";
*
inserting the following language at the end of the task force conclusions and recommendations on page 7: "regulate marketing practices to protect against invasions
of privacy; and provide purchasing options for consumers including "green power.";
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including a section on environmental issues;
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adding the following language to the third bullet under task force conclusions and recommendations on page 10: "It appears that a regional or larger ISO is more effective
than an ISO limited to one state. In addition, it must be demonstrated that adequate
transmission capabilities exist for wheeling electricity in and out of the state."
*
amending language relating to unbundling;