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More Than Ever, Firms Flip on Greener Switch by Lisa Cohn Portland Tribune, June 29, 2004

Sales of special ‘tags,’ clean-power options boom among businesses

For some companies, it’s not enough to talk the talk.

Managers at Portland engineering firm CH2M Hill Inc. wanted the company to “walk its talk” by buying green power from renewable energy sources for its Pacific Northwest offices, says Andy Linehan, the firm’s vice president and Portland area manager.

For its part, Mt. Hood Meadows Ski Resort buys “green tags,” or renewable energy certificates — which help pay for the above-market costs of building renewable power plants in an effort to improve air quality and cut down on greenhouse-gas emissions, says Mt. Hood sustainable business manager Stuart Watson.

Whether Portland area businesses aim to educate the public or make employees feel good about their companies, the movement is helping PacifiCorp and Portland General Electric achieve national prominence as green-power marketers. Portland businesses have boosted sales of the utilities’ clean energy, which comes from wind, solar, geothermal and other renewable energy facilities and is slightly more expensive than electricity from fossil fuel-fired facilities.

In 2003, PGE and PacifiCorp both ranked among the top five companies nationwide for green-power sales and customer participation, according to the U.S. Department of Energy’s National Renewable Energy Laboratory.

While homeowners comprise the majority of clean-power customers in the Northwest, commercial customers — who use more electricity— purchase about 30 percent of the green energy sold in the region, says Diane Zipper, director of green power programs for the Renewable Northwest Project, which promotes the use of renewable energy.

Local businesses also have helped increase sales of green tags, which are offered by Portland’s Bonneville Environmental Foundation as an alternative to purchasing clean power from a utility. When companies or individuals purchase the tags, the foundation uses the proceeds to invest in renewable energy plants that replace dirtier energy facilities.

“Green tags were first sold four years ago, and we sold 600 the first year,” says Patrick Nye, sales manager for the Bonneville Environmental Foundation. “Last year, we sold just under 150,000 green tags nationally.”

Portland is a good market for green energy because its residents and businesses tend to be environmentally conscious and progressive, Zipper says. And for some of the progressive Portlanders, buying green energy is a way of weaning the country off foreign oil at a time when gasoline prices are high. “People see renewable power as a local source of energy,” she says.

As an added incentive, the price of green energy has dropped 35 percent in recent years.

Four years ago, PGE unveiled its Clean Wind program, which is 100 percent wind power. At the time, the product carried a premium of $5 per 100-kilowatt-hour block. Now, says PGE spokesman Mark Fryburg, the price premium is $1.75 per 100 kwh, or $17.50 per month for the average 1,000-kwh per month residential purchaser.

New law adds a spark

Further fueling green power sales is a law restructuring the state’s electrical industry, which went into effect in 2002. Oregon regulators required PGE and PacifiCorp to begin offering choices, including green power. The utilities joined forces with experienced clean power brokers — Green Mountain Energy of Austin, Texas, and Three Phases Energy from San Francisco. Together, the utilities and their partners have put the word on the street through bill inserts and thank-you ads in the media, Zipper says.

Armed with the information, businesses and consumers have begun choosing from a number of clean power options, depending on how much money they want to spend and how green they want to go.

Utility customers can purchase the “greenest” power from PGE’s Clean Wind and PacifiCorp’s Blue Sky. The options are viewed as environmentally preferable because the electricity consists entirely of wind power. The utilities funnel a portion of the proceeds into new renewable energy projects. Thor Hinckley, manager of PGE’s renewable power program, says that getting new renewable energy plants up and running is the best way to reduce air pollution.

Another option is purchasing power from Green Mountain Energy or Three Phases Energy, Hinckley says.

Fifty percent of the power from Green Mountain Energy — sold through PGE — comes from new wind farms, and the rest comes from existing geo-thermal plants and hydroelectric facilities, Hinckley says.

The price premium is about $8 a month for a typical household that uses 1,000 kilowatt-hours, PGE’s Fryburg says.

Green tags work nationwide

Rather than purchasing one of these products from a utility, Portland-based David Evans and Associates Inc. decided to buy green tags. The company this year purchased 421 green tags from the Bonneville foundation, says Gillian Ockner, the company’s corporate sustainability coordinator. Because it has offices scattered around the western United States, and not all the utilities in those states offer green power, the company couldn’t buy clean kilowatts directly from utilities for each of its offices, Ockner says.

David Evans and Associates’ purchase is the equivalent of buying 6 percent of the company’s total energy from renewable energy plants, she says. When businesses or consumers buy a green tag, they pay for some of the above-market costs of clean energy, thus allowing for the construction of more renewable energy plants, Ockner explains.

“We are willing to spend our money to make sure that green power is available on the market,” she says.

Green tags are attractive to businesses, like David Evans and Associates, that have offices in several states. They’re also attractive because they’re generally less expensive than green energy from utilities, says Patrick Nye, the Bonneville foundation’s sales manager.

Cost of resource stays same

Whether businesses and consumers purchase green tags or clean energy, it’s seen as a move to purify the air in the Northwest. And even though the region already has embraced clean energy faster than other parts of the country, there’s more work to do, Zipper says.

Right now, about 4 percent of PGE’s and PacifiCorp’s customers purchase green power. Zipper hopes the utilities can boost participation rates to 10 percent or more by 2008. She’d also like utilities to offer green pricing options that reflect the fact that the cost of the resource — the wind or the sun — doesn’t change.

In addition, Zipper hopes utilities build additional green energy plants whose electricity would be used by all customers — not just those willing to pay a premium.

PacifiCorp has said it will purchase 1,400 megawatts of wind power in the next 10 years, which would power 340,000 Northwest homes.

“Green-power programs are a great way to bring in some new renewable energy plants,” Zipper says. “But to get significant megawatts generated in the Northwest, the utilities need to start buying and building more renewable-energy wind power and geothermal power — on behalf of everyone.”