The Oregon Renewable Energy Act has an impressive, greenish goal. Senate Bill 838 would require Oregon’s largest utilities to get 25 percent of their power from renewable sources by 2025. For the bill’s purposes, renewable power means things like wind, solar, geothermal, wave and new hydro plants – not existing hydro.

Some 22 other states have adopted similar standards. Oregon consumer and environmental groups like it. The big utilities, Portland General Electric Co. and Pacific Power, support it. Renewable energy companies are excited about what it might mean. But there is concern among other businesses and Republicans in the Legislature about what the bill’s mandates will do to electric bills.

At the minimum, we believe the bill has some serious flaws that must be addressed. The bill reduces oversight of utilities and an amendment inserted in the bill tags on a sweet deal for industrial customers.

The reduction in oversight comes in a section about an “automatic adjustment clause.” It gives utilities more power than they have now to raise their rates. Right now, when a utility wants to raise rates, it must go before the Public Utility Commission. A contested hearing is held. The utility must document why it wants to raise rates.

SB 838 makes it easier for utilities to raise rates to cover the costs of moving to renewables. A utility is still required to get approval from the PUC, but the process is different. There is no contested hearing. Instead, there is just an opportunity for public comment.

That’s less protection for consumers. Just because the costs are costs for going more green doesn’t mean that the public doesn’t deserve the same protection. We see no reason why the standards should be dropped.

The PUC does a good job of protecting consumers from paying more than they should under the contested hearing system. Not every rate increase utilities ask for is approved. Earlier this year, the PUC cut $49.4 million from Portland General Electric’s request to increase rates to recover costs for expenses and for a new power plant. Instead of PGE consumers seeing a rate increase of 4.3 percent as PGE requested, the commission decided that only a 1.3 percent increase was necessary.

The sweet deal is way back near the end of the bill – it’s on page 28 in our version. The amendment allows utilities to include the costs of “implementing cost-effective energy conservation” in their rates. We see nothing wrong with that.

But the amendment exempts utility customers with loads greater than one megawatt – in other words big, industrial customers – from paying for conservation. We don’t see any reason why households and smaller businesses should have to pay a disproportionately high percentage of a utility’s conservation costs. Do you?

It’s hard to tell what the bill is going to mean for rates. Scott Bolton, who does government affairs for Pacific Power, says consumers can expect rates to go up with or without the bill. As power demands increase, Pacific Power expects the cost of providing it to increase.

Hydropower is the least expensive source of electricity in the United States. But there is not a lot of support for more big dam projects. Small hydro projects like the one Central Oregon Irrigation District is working on between Bend and Redmond will help.

For Pacific Power, coal-fired plants are the cheapest way for it to provide electricity right now. In the future, that may be wiped out by carbon emissions taxes that drive up the price. Burning natural gas is still competitive. It’s future is also uncertain because of the volatile world market. So Pacific Power is looking at wind as a cost-effective way to add more renewable power in Oregon.

Wind can be a great source of power. The fuel is free and the capital costs and maintenance are not outrageous. Wouldn’t you know it, but there are hard choices that have to be made about wind, too.

Power in the wind is ranked on a scale of 1 (the lowest) to 7 (the best). If you look at a wind map of Oregon prepared by the U.S. Department of Energy, the best place to put wind farms in Oregon would be to line them up along the coast from Coos Bay to Brookings. And because wind speed is higher the more you go up, taller towers are better.

Are Oregonians going to want that along the coast? Probably not. Of course, there are other places to put windmill farms. They just won’t produce as much power.

The wind is also fickle. It doesn’t always blow when you need it. On hot days, when the air conditioners crank up, the wind tends not to be blowing. So even if utilities invest in more renewable wind energy, they have to also invest in power sources, perhaps less green, that will be able to meet demand when somebody flicks on a switch.

Supporters of Senate Bill 838 argue it is not perfect. Most importantly, it’s unclear what it will do to utility rates. Still supporters say it gives Oregon a good shove in the right direction – cleaner, renewable power. And it reduces the state’s dependence on foreign oil.

If the Legislature is going to pass this mandate, it should at least strip out the reduced oversight of utilities and the sweet deal for industrial customers. And then it needs to come back in 2010 when the mandates start kicking in, and ensure that the plan to make Oregon green is not an environmental catastrophe of our own making.