A survey finds that consumers would support higher costs of “clean coal” and alternative fuels.
Gregory Aliff is vice chairman and national managing partner for energy and resources of Deloitte & Touche LLP. Contact him at firstname.lastname@example.org. Branko Terzic is a global and U.S. regulatory policy leader in energy and resources for Deloitte Services LP, and a former commissioner on the U.S Federal Energy Regulatory Commission and the Public Service Commission of Wisconsin. Contact him at email@example.com.
Climate-change concerns and escalating energy costs have caused many states to introduce voluntary or mandatory programs to support “renewable” or “alternative” energy frequently along with consumer efficiency and conservation measures. Most renewable energy sources have costs exceeding the current production costs of conventional fossil-fuel generation or nuclear power as calculated for utility ratemaking purposes. This means that, absent conservation or efficiency measures, consumers’ bills will increase if the switch is made to renewable energy supply.
How willing are consumers to accept such increases? To answer that question Deloitte surveyed residential consumers a few months ago on the subject. Consumer acceptance of mandatory renewable purchases in spite of an expected price increase in electricity would be critical to continuation or expansion of state programs and such acceptance also would support Senate and House proposals for federally mandated renewable portfolio supply (RPS) programs.