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Carbon Tax – A Good Idea Whose Time Has Not Yet Come

Posted in Tax, Tax and Tax Stimulus

Are we ready for a carbon tax? Al Gore thinks so. He recently blogged that a “tax on carbon is an idea whose time has come.” A carbon tax would impose a price on emissions of carbon dioxide and other greenhouse gases. It would rely on market forces to encourage the development and use of clean energy, unlike the inefficient (or so economists would argue) mechanisms that we currently use for that purpose; i.e., direct cash subsidies, tax credits, and mandated use of energy from renewable sources. For that reason, economists like the idea of a carbon tax. Even those with a conservative bent generally agree that it is the most effective way to reduce carbon emissions, although they may question the need to do so in the first place.

Unfortunately, Congress does not appear to have any takers, or at least anyone who is willing to spend political capital to champion a carbon tax. Republicans do not support it because they reject the idea of climate change, or they do not believe that there is a link between climate change and carbon emissions, or they generally oppose new taxes of any kind; and Democrats have not pushed for it, in part, because they are concerned that it would be regressive.

A recent study prepared by the Congressional Budget Office (CBO) is a reminder of other political hurdles that would have to be overcome in implementing a carbon tax, even if Congress could agree in principal that doing so is a good idea. See Effect a Carbon Tax on the Economy and the Environment (May 2013). The CBO study concludes that a carbon tax could increase federal revenue and encourage reductions in CO2 emissions. It also concludes that the tax would impose a cost on the economy. None of those points are particularly surprising or controversial. The study also reminds us, however, that the specific effect of the tax on the economy would depend on how revenues raised by it are used; in short, who benefits from the revenue.

Congress can choose to spend revenues from a carbon tax in any way it wants. It can use it to reduce the federal budget deficit, to decrease marginal income tax rates, or to compensate those who would be disproportionately affected in a negative way by the tax (e.g., low-income households, workers in emission-intensive industries and parts of the country that have no choice but to rely on emission-intensive forms of energy). There is endless room for debate (i.e., political fighting) on how to spend the revenues.

So even if everyone agrees that a carbon tax is good idea, Congress will have to reach further agreement on this and many other essentially political issues before the tax’s time will truly have come.

Hope, Despair and the Challenges Going Forward: The IEA 2012 Report on World Energy Statistics

Posted in Energy Conservation, Natural Resources and Environment

USA Today had an article last week with the worst good news for carbon emissions that I’ve read in a while. The good news was that U.S. emissions fell to the lowest rate since the mid-1990s, dropping 200 million tons, or 3.8 percent. The bad news is that world carbon emissions rose by 1.4 percent in 2012 to a record high of 31.6 billion tons.

China is now the world’s largest emitter of carbon, with growth in emissions up 300 million tons or 3.8 percent since 2011. Developing countries now account for 60 percent of global emissions from energy use, up from 45 percent in 2000.

So what does that tell us? Does it mean that the people who have resisted any national energy policy for the United States, much less having the United States sign international carbon treaties are right – there is nothing that the United States can do that makes any difference? On a happier note, does it mean that the United States is actually doing quite well, making steady progress towards the goal of reducing its carbon emissions to sustainable levels?

I would answer those questions “no” and “no.” There are no simple answers in the search for sustainability. At a headlines-level, the report is bewildering and disheartening. But the report provides layers of data, precisely because achieving carbon sustainability is not going to be possible if you don’t look behind the headlines. Continue Reading

Transportation Packages and a Wake-Up Call

Posted in Legislation

On May 13th, less than two weeks ago, I, along with Steve Marshall, Executive Director of the Center for Advanced Transportation and Energy Solutions (CATES),  Jan Greylorn associated with the Washington Clean Technology Alliance, and Jeff Esfeld of VIA Motors, were in the Rotunda Room of the Washington State Capitol Building for a transportation “rally” as part of the kick off for the special legislative session. It was a packed room filled with legislators, Governor Jay Inslee, WSDOT Secretary Lynn Peterson, government officials, lobbyists, and interested parties.

No one in that room doubted the need for a transportation package being passed in this special legislative session. The package is not ambitious—rather it is trying to finish up the commitments on five major projects (520 bridge, SR99 tunnel, I-5 Colombia River Bridge, SR-167, and SR-509) and address our aging and weakened transportation infrastructure. In his remarks, Governor Inslee noted the sad state of our transportation infrastructure. It is both a public safety issue as well as an economic development issue. Our transportation helps (or hurts) all of us in the state—we all need to be able to get to and from work safely.  We need food, clothing, and other necessities  transported across our state highways. Good transportation systems equal good economic climate to attract new businesses and jobs. Conversely, bad transportation systems equate to barriers to start-ups, disincentives regarding business expansion here in our state, and misery for all commuters, vacationers, and deliverers of any service or good.

Last night, the I-5 Skagit River Bridge collapse was a huge wake-up call for our state. An aging mid-1950’s bridge collapsed in a matter of minutes when an oversize truck hit one of the bridge truss elements. The good news is that there were no fatalities or even serious injuries. However, it was a huge scare to those affected. Two cars were submerged in the Skagit River, and thousands were and will be affected by the bridge closure. According to the Seattle Times, government officials did not believe that this bridge was particularly worrisome when the state received an overall “C-“ for bridge safety.

The state’s number one goal is public safety. Economic development (for all) is goal number two. Taking care of our aging and decaying transportation infrastructure needs to be given the high priority that it deserves. The legislators and Governor are eager to get a transportation bill passed. It’s now time for the public to set aside tax aversion and do its civic duty.

Can Puget Sound Bike Share Help Solve King County’s Last Mile Problem?

Posted in Energy Conservation, Fuel Efficiency

By Diane Meyers, Guest Blog Contributor

I am new to Green Tech blog, but you might remember me as the “incensed” partner who objects to paying bicycle taxes on bikes as a way of funding a highway and other infrastructure to which bike users have virtually no access (at the top of my list of objections is that the proposed bike tax would fund highways and highway expansion, not bike-and pedestrian-friendly complete street initiatives). For another time is my side of the debate about the wisdom of an extra tax on bike purchases (for the record, I am not against them across the board).

What we do agree on is the promise of bike share coming to Puget Sound. And, probably, the necessity of additional bike—and other non-car—infrastructure.

Imagine this in Seattle:

 

The recent announcement by Puget Sound Bike Share that it is moving forward with the next phase of bringing bike share to Seattle should be hailed with the sort of fanfare that might be given to an announcement that King County Metro’s budget has been doubled (were it so!) or that light rail will connect Seattle to the eastside (make it happen!): it is a game changer in our urban transportation landscape.  

Bike share is a network of shared bicycles that are available for rental on a short-term basis. From its audacious beginning in 1965–50 bicycles were painted white and dispersed around Amsterdam for anyone to use free of charge—to today, where some describe bike share as the “fastest growing” mode of transport in our planet’s history, bike share has a lengthy and mostly positive history of contributing to community transportation, culture, and climate. The organization, design, and operation of the system vary widely around the world (some are run by local community groups, others by public-private partnerships, still others by government agencies), but the fundamental concept is similar: bike sharing extends traditional transportation systems (solving the “last mile” problem), provides faster and more convenient access to areas underserved by those systems, and increases opportunities for multimodal transportation. At the same time, bike sharing does not create pollution or add to global warming (unless you believe that bicyclists pollute the environment simply by exhaling, as some apparently do), improves congestion, is less expensive to implement and requires less infrastructure than other transportation modes, provides a low-cost, on-demand transportation option, promotes physical activity, and generally “enhances livability and neighborliness” of an area. (For an excellent survey of bike share generally and assessment of its introduction in Seattle, take a look at Seattle Bike Share, which links to a 2010 feasibility study conducted by UW graduate students and commissioned by SDOT.)

With all of this going for it, how can bike share be wrong? There are some obvious hurdles to overcome—most point to King County’s mandatory helmet law, others to our region’s topography—but Puget Sound Bike Share has teamed up with Alta Bicycle Share, one of the most experienced operators of bike share around the country, and has been studying this issue for several years. I applaud their efforts and look forward to joining at first launch in 2014. We may not beat NYC’s recent bike share success—5,000 signed up for bike share in the first hours of registration—but we can come close.

For six years running, Washington has been named the most bike friendly state in the U.S. by the League of American Bicyclists, an organization that has been around longer than Washington has. Puget Sound Bike Share provides an opportunity to further enhance that hard-earned, well-deserved reputation.

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Diane Meyers is a shareholder and member of Graham & Dunn’s Litigation & Dispute Resolution team, focusing her practice on commercial litigation and appellate advocacy. She is pro bono outside general counsel to Puget Sound Bike Share.

Obama Budget Increases Funding for Clean Energy – But Don’t Get Too Excited Yet

Posted in Clean Energy, Department of Energy, Energy Conservation, Legislation, Renewable Energy, Tax, Tax and Tax Stimulus

President Obama has released a budget plan for the 2014 fiscal year that increases funding for the development of clean energy. Before you break out the champagne, however, keep in mind that this is just a proposal by the President and must still be approved by Congress. The plan, which was released on April 10, would:

  • Increase funding for Department of Energy’s clean energy technology activities by more than 40%, to $6.2 billion.
  • Increase funding for clean energy technology across all agencies by 30%, to approximately $7.9 billion

A noteworthy part of the budget plan is a proposal to make permanent certain tax incentives for renewable energy production and tax credits for advanced energy manufacturing. This part of plan would cost $23 billion spread over 10 years. Making the tax credit for the production of renewable energy (PTC) permanent would, in the words of the administration, “provide a strong, consistent incentive” for investments in renewable energy technologies and “meet our goal to double generation from wind, solar, and geothermal sources by 2020.” In addition, the budget plan makes the PTC a refundable credit, which, if finally approved by Congress, could be a key source of financing for many startup companies in the renewable energy industry.

To help pay for these and other increases in the Federal budget, the budget plan calls for a repeal of many tax incentives, such as the deduction for intangible drilling costs and the Section 199 manufacturing tax deduction for oil and gas, that many view as subsidies to taxpayers in the the fossil fuel industry. The repeal would raise approximately $44 billion over 10 years.

It should be noted that the President has introduced in prior budget cycles many of the ideas that now make up his budget plan for the 2014 fiscal year, but without success in getting them implemented. For example, in 2012 he included a permanent, refundable PTC in his proposed budget for the 2013 fiscal year, but this was finally rejected by Congress. So while it is encouraging to learn that the President and his team continue to support and push for clean, renewable energy, it is still a little too early to get excited about the prospect of additional funding for companies in the industry.

Car2Go – A Game Changer?

Posted in Electric Vehicles, Fuel Efficiency

Car2Go, an inexpensive rent-by-the-minute “Smart Car,” has been wildly popular in Seattle. Since its launch at the beginning of the year, I can find no less than three and sometimes as much as six within a quarter mile of my house. What is happening?

By any sales measure, the car2go model is very successful. Consumers love them because they are easy to use, easy to find, cost-effective (38 cents per minute with a maximum cap per hour), and small enough to park nearly anywhere (with paid parking no less). And car2go is gaining a lot of media attention and acquiring new members (customers) at a rapid clip. I’m about to join them.

Car2Go, is owned by Daimler AG, the parent owner of Smart. Daimler started offering car2go in Europe in 2008. Car2Go has begun offering member services in San Diego, Austin, Portland and Seattle. Daimler offers its San Diego members all-electric Smart Cars.

In Seattle, all of the Smart car2go vehicles are gasoline-powered. It may be an interesting experiment: are the gasoline powered vehicles here so wildly popular because they are accessible nearly anywhere and not limited to access to a charging station or at least a 110v outlet? While an all electric Smart Car would reduce greenhouse gases more than a gasoline-powered Smart Car, the gasoline-powered Smart Car gets approximately 36 miles to the gallon (non diesel version). Driving even a short distance is not an environmental equivalent for walking or riding a bike, but far more environmentally-friendly than taking the “big vehicle” (think SUV or large sedan) to get a traveler (or two) from point A to a short distance point B.

Car2Go seems to be so popular in my neighborhood to go that “last transit mile” or a short distance (the grocery store, for example). But there are two trends that might cause pause for others than Car2Go. These are: (1) more urban, or possibly non-urban, consumers may decide that they don’t need a second vehicle and can more readily rely on mass transit, and (2) so called “millennials” (the Millennium generation or “Gen Y generation”) don’t appear to want or need a personal car as an extension of their persona or “personal brand.” While these trends are great for the environment, automobile manufacturers (other than Daimler) might have much to worry from the very sizeable millennials, in general, and car2go millennial members, in specific, or adopt a similar “rental” model.

Electric Vehicles, Hybrids and Bicycles Need to Pay Their Share

Posted in Clean Energy, Electric Vehicles, Fuel Efficiency, Tax

I am a huge fan of plug-in hybrid and electric cars. I bought a plug-in hybrid in early January and have filled its tank twice now. The last time was a couple of weeks ago and since then I’ve driven 250 miles on about three gallons of gasoline. I think everyone should have one; although, as I’ve written, I think we need to get our electric rate structures figured out so that owners of plug-in electric vehicles have every incentive to charge overnight and not during peak demand periods. This car meets all my goals of saving gasoline when I need to drive long distances to places without charging stations. Mostly, it takes me back and forth to work, or around town, with energy from the hydroelectric dams Seattle City Light operates.

Recently, I’ve been having a debate with one of my partners, who bikes to work, and who is incensed that a key current transportation funding bill in the Legislature would impose a $25 excise tax on the purchase of a bicycle costing $500 or more. My response is that we need to tax all bikes and we need to increase the tax on electric vehicles and hybrids. She says I get credit for consistency, but she’s not buying it. She makes some valid points about the tax falling mostly on independent bike shops, while the major discount stores can sell bikes for less than $500. She also makes a valid point that far more bicycle infrastructure is needed than a $25 tax on new bikes will pay for, although I’m not quite sure why the fact that the tax won’t raise enough money to do what is needed is a reason not to have the tax.

Really, the bottom line is that we need to be taxing all bikes, electric vehicles and hybrids. We have a huge transportation funding deficit and all users who need facilities built for them need to be prepared to pay their fair share of the transportation budget. That is true because the deficit in our transportation funding is so huge that there simply is no free lunch. And it’s true because in our polarized, tax-averse political world, the ability to get anything paid for depends on everyone feeling that the system is fundamentally fair, most especially the people being taxed.

Washington’s primary source of road funding is the gas tax. The State Supreme Court has held that gas taxes cannot be used for transit facilities under the state constitution. So, transit is paid for by sales tax and recently by a motor vehicle excise tax, as well as federal funding. But gas taxes are a declining resource. If the number of vehicle miles driven stayed unchanged, the shift to more fuel efficient vehicles would automatically reduce gas tax revenues. The recession compounded that effect by causing people to drive fewer miles. As recently as 2010, the State’s Office of Financial Management forecast that gasoline use would increase at around 1.2% per year over time. Today it estimates that gasoline consumption will fall on average about 0.43% per year. We have not kept up with basic maintenance of our state or local transportation infrastructure. A commission appointed by former Governor Chris Gregoire estimated that the state has at least a $50 billion backlog of maintenance and basic infrastructure preservation tasks. That was before a federal judge ordered the State to accelerate repair of culverts that block 1,000 miles of salmon migration – at the cost of more than $1 billion.

The bottom line is that my plug-in hybrid puts exactly the same demands on our state and city roads as my old VW Beetle did. But it not only doesn’t make me pay for gasoline, it also exempts me from gasoline taxes.

My partner wants – correctly, in my view – the City to spend a lot of money to build bicycle lanes, to separate bicyclists from automobiles. We need to do that. Bicycling is great exercise for our increasingly sedentary society and we should encourage it. It is carbon neutral. Most importantly, bicycles and automobiles in the same space are a disaster on two fronts: the bicycles slow down the cars and thereby increase congestion on already congested streets, and while a fender bender between two cars makes for repair bills, the same accident between a car and a bicyclist kills or maims the bicyclist. We simply must separate the two.

But the cost of all of this will necessarily fall most heavily on the people driving cars. In a world with Tim Eyman, it may need a vote of the people. Even if a vote is not required, politicians who vote for new taxes are going to have to explain and defend that decision at the next election, and if people don’t feel the decision was warranted, politicians will be replaced. Taxes must be fair, and they must be perceived as being fair. If they are not, they will not last long in a democracy.

There has been an argument among bike and electric vehicle enthusiasts that they are “so good” for the environment, it is important to encourage them, and that they should somehow be exempt from taxes. It is as if taxes, being nasty, should fall on the folks who want to do “nasty” things, not on people who are “virtuous.”

Don’t get me wrong. I will happily take my tax credit if the federal government wants to make up for the fact that the plug-in part of my car added several thousand dollars to its cost. Subsidizing early technology is one of the key ways that government has brought many technologies to commercial viability. But the federal tax credit is the government’s effort to get the plug-in hybrid market past its initial start-up costs. I don’t expect that in addition to federal tax incentives, the fact that I bought a green car should keep me from paying my fair share of the cost of the roads I drive it on. I think all people who believe that it is important to make basic infrastructure investments in our transportation system should be prepared to step up to their share of that cost. That includes me, and the folks about to spend $500 on a new bike.

Sequestration and Renewable Energy Financing

Posted in Clean Energy, Renewable Energy

Sequestration was not supposed to happen, but it did. We have heard the litany of horrors that will now be visited upon us: longer lines at airport security, the closing of airport runways causing flight delays, shorter operating hours at national parks and so on. Sequestration has resulted in indiscriminate across-the-board spending cuts that affect every government agency and program, including those that promote clean energy.

The Treasury Department has now explained the effect of sequestration on the Section 1603 cash grant program for renewable energy projects. That program was introduced by the American Recovery and Reinvestment Act of 2009 to encourage investment in renewable energy projects. It provides direct cash grants for energy property that is placed in service by a specified credit termination date. The date varies depending on the type of renewable energy involved. The amount of a Section 1603 cash grant is up to 30 percent of the energy property’s tax basis and is claimed in lieu of any production tax credit or investment tax credit that would otherwise be available. The program has been popular and has helped attract investors to renewable energy projects where the numbers would otherwise not pencil out.

The Treasury also announced that Section 1603 cash grants issued between March 1, 2013 and September 30, 2013, when the current fiscal year ends, will be cut 8.7 percent, irrespective of when the application for the grant was received by Treasury. However, awards made prior to March 1, 2013 will not be affected.

The announced cut will have more of an impact on solar energy projects than wind energy projects. In order to take advantage of the Section 1603 cash grant program, wind energy projects were required to be placed in service by December 31, 2012, a deadline that has already passed. Solar energy projects, however, do not need to be placed in service until December 31, 2016.

The 8.7 percent cut translates into a loss of 2.61 percent of the cash invested in a project (i.e., 30 percent x 8.7 percent). That may not sound like a lot, but with returns already pretty thin, it may cause investors to shy away from some projects.

Why Electric Cars Require Us to Get Electric Rates Right Now

Posted in Clean Energy, Electric Vehicles, Renewable Energy

I got gas a couple of weeks ago.  Ok – mostly that wouldn’t be worth reporting.  But it was the first time for my new Ford C-Max Energi plug-in hybrid.

Kathleen Petrich reported on January 9 that I had bought a new car.  I had been nursing my 13-year old VW Beetle, hoping that before it died someone would make a car that I could drive back and forth to work without using any gasoline, but still could drive to Olympia or Tacoma or Edmonds whenever I wanted without worrying about whether I had enough battery to get home.  And Ford did it!  Just in time.  The Ford C-Max Energi is a plug-in hybrid, which gets somewhere between 12 and 21 miles based on a full charge of its plug-in battery, then switches to a hybrid motor, using what we have all come to think of as “Prius technology.”  [Ford would be offended by that statement.  It turns out that Ford and Toyota were independently developing the technology at the same time.  After some suits and countersuits, they settled by giving each other a cross-license.  So they both have essentially the same hybrid technology, and each claim bragging rights to it.]

My new car is an amazing piece of engineering.  It is a joy to drive, with lots of pickup, great handling, an array of gadgets, and far more space than I was used to.  Ford claims I can expect better as the car gets broken in, but on that first tank of gas I went 642 miles on 10.9 gallons of gasoline, for an average gasoline use of 58.8 miles per gallon.  Yes, there were trips to Olympia, Edmonds, Kirkland and Tacoma, but mostly commuting to work has been gasoline-free.  Living in Seattle, where our electricity comes from water falling over dams, not coal- or gas-fired generators, that makes my commute about as climate neutral as it gets.  And when I get home at night, I plug it into a normal 110-volt plug in our garage – no fancy charging station for this car.  I love it!

But the experience has also focused my attention on the issue of “what happens if this move to plug-in hybrid cars succeeds like I think it will?”  Because it is hard to miss the fact that it takes energy to move this car, all 3,400 pounds of it, up and down the hills of Seattle.  Just because it is gasoline-free doesn’t mean it is energy free.  It can’t be.

Right now Seattle City Light gets about 13% of its revenues from selling surplus power on the wholesale market.  In the middle of the night, it can produce way more energy than it can sell, and mostly spills water over the dams rather than running it through the generators.  Charging a car at night has essentially no environmental consequences.  But what if 5 years from now 50% of the new cars in Seattle are plug in cars.  What then?

About 28% of all energy used in the United States is used by transportation.  That includes planes, trains, trucks boats and cars, not just the personal automobile.  But the personal automobile and fleets of vehicles that could be electric-powered are a significant share of the total.

Electric companies are required to build generation, transmission and distribution capacity to meet their peak demands.  That is typically the middle of the hottest day, when the most people are running their air conditioning systems at full bore.  Different electrical utilities have somewhat different peaking periods, but for all of them, by 10 or 11 o’clock at night, they don’t begin to need all the generation capacity they have.  Across the United States, during the off-peak periods there is enough unused electrical capacity to take maybe half the power demands of our automobiles if they were electric.  But, if all those cars were being charged during the middle of a hot summer day – the nation would need to build a lot more generation plants and distribution facilities and would need to upgrade its distribution systems downstream of thousands of substations.

And what would that mean?  Power companies are entitled to earn a return on the capital investments they are required to make in order to supply the power we need.  Those investments get repaid, and a return on the investment gets earned, through the electrical rates we pay.  That is a fundamental rule of utility rates.  So if power companies have to build new generation capacity, or new transmission lines or upgrade their substations, they are entitled to increase their rates to pay for that and earn a return on the investment.  The bottom line is that if some years from now, the conversion to electric cars forces construction of new generation, transmission or distribution capacity, the rates for electricity must rise.

What does that mean for today?  The power companies are saying, “don’t worry about it.  We’ve got plenty of power.”  And indeed many electric power companies have seen their loads fall as consumers have invested in energy saving devices and strategies.  When their load falls, the power companies need to cover their return on investment from the sale of fewer kilowatt hours of electricity.  Power companies don’t necessarily like too much conservation.  And they would not necessarily mind having a new source of load on their system – that is more kilowatt hours to sell.

But the rest of us, and particularly the automobile companies that have invested in developing this amazing new technology, need to worry now.  People who would love to see a major switch to electric cars should be insisting that electric rates get set now to encourage electric cars to be charged at night.  Some Northwest utilities already have time-of-use pricing.  Smart metering makes that possible.  On the other hand, when time-of-use pricing just moves the existing load around, there can be real disadvantages as well, because while some customers’ rates go down, customers who use electricity during peak periods see their rates go up.

But electric cars are not existing load – they are potentially a huge new load.  That load needs to be met, to the greatest degree possible, by the unused capacity of the off-peak hours.  And now is the time to develop the rate structures and the technologies to encourage electric car owners to charge during off-peak periods.

That can still make electric cars a new source of revenue for power companies.  They need not worry about too much efficiency with electric cars – every kilowatt sold to power a car is a new kilowatt.  But if we just assume that electric cars can be charged “whenever” – if we wait until the power companies have to build more capacity or we start to experience brown outs as a result of that new load – the odds that we can get this right go down.  At that point electric cars will be demonized, and we will have one more example of the law of unintended consequences.  What could and should have been a major tool in reducing carbon emissions and our dependence on foreign oil will instead sour, as all electric consumers pay the price.  There is no excuse for that to happen.  We should be smart enough, and able to see over the horizon well enough, to address the problem now.

Governor Inslee is Doubling Down on Clean Transportation

Posted in Clean Energy, Energy Conservation

Governor Inslee released his February clean energy policy brief last week.  It was full of references to clean transportation—as a means for economic development as well as reduction of greenhouse gas emissions.  While there are many aspects that are worthy of highlighting, I am highlighting just a few items in Governor Inslee’s brief.

Washington spends more than $20 billion each year on energy. “Shrinking our dependence on imported energy and boosting home grown clean energy will strengthen and expand our economy.”  Approximately ¾ of the $20 billion dollar energy goes for traditional transportation fuels.  Governor Inslee wants to quickly move to electrify our state transportation system by taking advantage of clean and affordable electrical power.  “We will ensure that state investments in transportation contribute to clean energy and climate solutions while we generate jobs and save taxpayer dollars.”

Governor Inslee calls for the extension of the electric vehicle “corridor” (from British Columbia to Oregon along I-5 and completed last year) across I-90 to Spokane and along Highway 101 to expand consumer confidence for using electric vehicles throughout the state.

By leveraging the clean power that we already generate through low-cost hydropower and wind resources, local electrical utilities can be part of the solution in the move to vehicle electrification.  While there were no specifics here, the reference leads me to believe that there will be changes to utility regulation that encourages and accounts for increased demand of electricity from EVs when displacing other forms of energy generation.

Of interest was the statement “The Governor will direct state procurement of electric passenger vehicles, with other public and private entities, for a net savings of taxpayer dollars.”  State fleet vehicle purchases are certainly envisioned, but the reference to public and private partnerships is certainly encouraging.

Lest one think it all about electrification in the transportation space, the Governor is showing his commitment to biofuels.  Specifically, the state will support biofuel production at Washington biodiesel refineries and oil seed farms at costs below those for imported fuels.  The state will also support Washington State University’s new Center for Excellence of Alternative Jet Fuels and the Environment in terms of matching funds to help nurture partnership among the state’s research institutions and its agricultural, aviation, and maritime industries.

If you think the Governor’s clean energy policy brief is still “aspirational” rather than reality-based, his selections for key state posts would suggest that business is anything but usual.  Yesterday, Governor Inslee appointed Lynn Peterson to head Washington State Department of Transportation (WSDOT).  Ms. Peterson was a special aid to Oregon Governor Kitzhaber regarding sustainable transportation solutions.  She was not the “usual suspect” for the WSDOT post.  But her visions seem to be very aligned with the Governor’s clean energy policy brief.  And Ms. Peterson’s appointment represents a very real possibility of a Washington-Oregon alliance for purposes of fleet volume purchases/getting attention from manufacturers/furthering the work of the West Coast partnership regarding the creation of common standards, pooled research results, and developing joint economic development opportunities.  [As an aside, I (along with Steve Marshall, Mike Grady, and Jan Greylorn) had the opportunity to meet with Ms. Peterson in Oregon in December.  While none of our group had any idea that she may be in the running for the WSDOT post –and perhaps she wasn’t at that time–, I was struck by her knowledge, sense of reality, and level of commitment regarding clean transportation.]

These are exciting times with potential for significant change.