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Executive Summary
Energy efficiency and wind
power can provide major economic development benefits for Washington state and
help ensure a reliable and affordable electricity supply. Tapping our efficiency
and wind potential will create jobs, generate revenue for landowners, increase
local tax revenues, and save water.
Energy Potential
Washington has substantial
wind resources and a wealth of untapped potential for energy efficiency improvements.
• The state could commit
to a reduction in electricity consumption of at least 12 percent by 2020. Annual
demand reduction would reach 1,700 average megawatts (aMW) by 2020, enough to
power 1.1 million homes. This is only half the potential identified in a recent
survey of cost-effective energy efficiency opportunities.
• Washington could
install enough wind turbines to generate 1,700 aMW of power by 2020. This would
meet 14 percent of our power needs. With this amount of growth, Washington will
have developed 89 percent of its total wind potential according to the most
pessimistic resource estimate and 24 percent of total potential according to
the most optimistic published estimate.
• The alternative plan
for Washington is to meet growing electricity demand with 3,400 aMW of new natural
gas power plants, which would decrease reliability, increase pollution, and
leave consumers vulnerable to periodic price spikes.
Economic Benefits
Developing energy efficiency
and wind power would have much greater economic benefits than continuing on
the path of building more natural gas power plants.
Efficiency and wind would
create more jobs than natural gas.
• Implementing 1,700
aMW of energy efficiency would create the equivalent of 11,400 yearlong jobs.
• Developing 1,700
aMW of wind power would create 8,700 yearlong jobs and 590 permanent jobs.
• Building 3,400 aMW
of natural gas power plants would create 5,700 yearlong jobs and 330 permanent
jobs.
• Total employment
from wind and efficiency equipment and facilities built through 2020 would be
2.5 times as high as from natural gas—37,940 person-years for wind and
efficiency compared with 15,460 person-years for natural gas.
Wind power would generate
revenue for landowners.
• Farmers, ranchers, and other rural landowners can benefit financially
from leasing land to wind farm developers. Ninety percent of the land can still
be used for other purposes.
• Developing 1,700
aMW of wind power would result in approximately $103 million in lease payments
to landowners through 2020 and $11 million per year thereafter.
Wind power would create
a stronger tax base than natural gas power plants.
• A wind farm has higher capital costs than a natural gas power plant of
equivalent capacity, for which ongoing fuel payments comprise much of the cost
but are not taxed. Therefore, wind developers pay more property tax than owners
of gas plants.
• Wind power would
generate twice as much tax revenue as natural gas for half the capacity—$372
million in annual property taxes for 1,700 aMW of wind power compared with $192
million for 3,400 aMW of natural gas.
Natural gas would use
large quantities of precious water resources, while wind power would not.
• Fossil fuel-based energy generation requires enormous amounts of water
for steam and cooling. The amount of water used by wind and efficiency is negligible.
• Developing 3,400
aMW of natural gas power plants would require 3.5 billion gallons of water per
year by 2020.
• Judging by the cost
of recent water transfers, the rights to this water would cost $16 million.
Washington's Energy Industry
The energy efficiency and
renewable energy industries in Washington are ready to take advantage of growing
opportunities.
• At least 274 firms
identified their primary business activity as energy efficiency or renewable
energy in a recent survey by the Washington Department of Community, Trade,
and Economic Development.
• These industries
generated nearly $1 billion dollars in annual revenue, employing nearly 4,000
people and delivering $160 million in wages to Washington citizens.
• Including the additional
energy efficiency work done by the many companies that design, build, and install
energy efficient equipment and buildings but do not count it as their primary
business activity, the energy efficiency industry employs 10,000 15,000 people
in the state.
Policy Findings
Specific policies that would
best help Washington realize its efficiency and wind potential include:
• An energy conservation
standard requiring all retail electricity suppliers to meet a minimum percentage
of future power needs with energy conservation.
• A renewable energy
standard requiring all retail electricity suppliers to obtain a minimum percentage
of their electricity from new renewable sources.
• No new permits for
fossil fuel-based power plants beyond the 21 permits that have recently been
granted.
• Tax incentives such
as a sales tax exemption for equipment used in wind farm construction or reduced
property tax rates for wind energy facilities.
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