Feb 3 - McClatchy-Tribune Regional News - Adrian Sanchez Columbus Telegram, Neb.


State Sen. Arnie Stuthman's bill to raise the limit on customer-generated electricity has kindled discussion regarding agricultural based alternative energy options in the state.

Last week the Legislature's Natural Resources Committee received public testimony on the bill with a number of agriculture and livestock producers speaking on behalf of the bill, while public utilities primarily expressed concerns about increasing the limits.

The bill, LB960, introduced by the senator from Platte Center, would raise the current energy production limit of 25 kilowatts (kW) to 125 kW.

Stuthman, whose tenure will end Dec. 31 due to Nebraska's term limits, said the current limit on customer-generated energy production is fine for residences, but is insufficient for larger operations that want to install energy generation systems to meet their consumption needs.

 The senator said Nebraska should be supportive of ag producers who want to take advantage of alternative energy sources such as wind, solar and hydro power, as well as methane digestion systems that can produce as much as 80-100 kW of energy.

"If the state would go to a higher limit, there is the opportunity (ag producers) would invest a higher amount" in alternative energy options, Stuthman said.

He said larger farm and livestock operations can use 40-60 kW but he wanted to set a limit that was high enough so the Unicameral would not have to address the issue again.

While Nebraska Public Power District (NPPD) supports the intent of the bill, the timing and magnitude of the bill prompted opposition.

Dave Rich, renewable energy development manager for NPPD, testified at the committee hearing on the bill and said adoption of the bill would be ill advised at this time.

Rich said NPPD has worked with several state and federal agencies in support of utilizing ag-related methane for energy generation and will continue working with ag producers regarding renewable energy projects.

"This specific bill we think is unnecessary at this time," he said, because requests to NPPD to install generation systems have been minimal and none have proposed exceeding the 25 kW limit.

Rich said should such a bill eventually become law the estimated $500,000 cost to install a wind generator or methane digestion system that would produce greater than 80 kW of power is cost prohibitive for most operations, especially with the availability of low-cost public power.

"We support Sen. Stuthman's desire to help livestock methane become desirable," he said, but NPPD would rather work with public districts and end-use customers in developing programs and limits that fit their needs rather than see implementation of a blanket policy. Public power districts are allowed under state statute to raise the maximum production levels for their customers.

Beth Boesch, NPPD senior manager of government and public relations, added the impact of the law implemented last year permitting customer-generated electricity at the 25 kW limit has yet to be studied.

"We should test the current law before raising the limits," Boesch said.

Ron Hostetter, CEO and general manager of Cornhusker Public Power District (CPPD), agreed, stating a determination has yet to be made on how the integration of customer-generated electricity impacts transmission quality for other customers.

"We would like to see the Unicameral step back and let that law take place," Hostetter said, and allow some time for districts to monitor the effects.

Although CPPD has yet to receive a customer request to generate electricity, should a request be made, other customers would have to subsidize that unit at a cost of hundreds of dollars annually, he said. And should the limit be raised to the 125 kW level, customers would have to subsidize each unit at an estimated cost of more than $2,000 annually.

"Out main issue with Sen. Stuthman's bill is other customers have to subsidize" that energy production, Hostetter said. "Should a customer put in (a system) as a way to make money, then our customers shouldn't have to subsidize that."

Hostetter said he does not anticipate a ballooning effect driven by raising the limit, but more so by federal subsidies and price reductions to make utilization of generation systems more cost effective.

Loup Power District does not anticipate much of an impact on its operations should a bill be approved since it doesn't provide much energy to rural entities.

Stuthman said he does not anticipate the bill will come out of committee, but his purpose for introducing the bill was to put the issue on the legislative radar and get people to discuss the opportunities it may provide.

He said he hopes the issue will be revisited every year until a higher limit is adopted.

"We need to get more from renewable energy," Stuthman said, and put the state in a position to capitalize on all agriculture has to offer.

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