Rhode Island governor vetoes renewable energy bill

Gov. Don Carcieri said Friday he has vetoed a bill that would force the state's major power company to buy renewable energy for 10 years at a time, a requirement that lawmakers approved to stimulate investment in wind turbines and solar power projects.

The proposal was supposed to fix a problem that renewable power advocates say blocks the construction of major green energy projects here: a lack of large customers willing to buy the power. Without a dedicated buyer, banks and investors will not fund the projects.

As a solution, lawmakers voted to force National Grid, the state's largest electricity distributor, to buy enough renewable power to supply about 9 percent of Rhode Island's electricity needs by 2013. In return, National Grid, which supported the bill, would receive a payment equal to 3 percent of the renewable power it bought.

In a letter to lawmakers explaining his veto, Carcieri said the bill could increase costs for customers. He said the bonus payment to National Grid was too generous and faulted the legislation because it gives preferential treatment to solar power projects, which Carcieri believes are too expensive.

He faulted the bill because it does not require developers to build projects in Rhode Island.

"I'm sure that projects located here will provide more jobs and more opportunity for our citizens," Carcieri wrote in the letter sent Thursday and released Friday.

National Grid believes the bonus payment is fair, company spokesman David Graves said. A decade-long contract to buy power shows up as a liability on the company's balance sheet and could hurt the firm's ability to borrow money.

"It was fair to request compensation for putting the company at risk," Graves said.

Democrats hold a veto-proof majority in the General Assembly. Senate President Joseph Montalbano sponsored the bill, but his spokesman could not immediately comment on whether Montalbano would attempt to overturn Carcieri's veto.

The Republican governor and Democratic lawmakers have feuded for months over how to develop renewable energy in Rhode Island.

Carcieri previously announced his goal of getting 20 percent of the state's electricity supply from renewable energy by 2011, a timeline his administration now acknowledges is impossible. Lawmakers rejected Carcieri's plan to create a state power authority that would buy energy from wind turbines and other renewable projects and sell it to consumers.

Instead, Democrats and a coalition of renewable energy advocates backed the current bill making National Grid the long-term buyer.

"It's essential to have them on board," said Matt Auten of Environment Rhode Island, a nonprofit group that supported the bill. "National Grid is the only one selling the vast majority of power in Rhode Island, and National Grid is the vehicle to do it."

At least six other states, including Connecticut, have adopted similar rules forcing electricity distributors or other large buyers to enter into long-term contracts with renewable energy developers, according to a 2008 report by the Lawrence Berkeley National Laboratory.

Besides the power bill, Carcieri also vetoed:

_ Legislation backing the construction of an $88 million courthouse in northern Rhode Island;

_ A bill extending the statute of limitations on civil rights lawsuits to three years;

_ A new rule banning state agencies and school districts from using radio frequency microchips to track the movements of individual students.