Paper industry seeks equality in pending RES bills

By Anna Austin
The American Forest & Paper Association has recently voiced concerns to Congress that it is not eligible to receive the same credits that utility companies will under several pending bills to develop a federal renewable electricity standard (RES).

A federal RES would require all investor-owned utilities to buy an increasing portion of their electricity from renewable resources such as biomass. Utilities that are unable to meet the new federal requirements can purchase credits from other entities who have obtained credits. Utilities can also bank credits for four years and borrow credits from up to three years in the future.

Several bills calling for an RES are pending, including one introduced by Sen. Jeff Bingaman, D-N.M., that would create a 20 percent renewable energy minimum by 2021, and another introduced by Sens. Tom Udall, D-NM, and Mark Udall, D-Colo., requiring a 25 percent renewable energy minimum by 2025.

If either proposal is passed, the demand for biomass is expected to increase, which could cause prices to rise. Because the paper industry uses biomass to make its products and generate electricity, it is likely to be negatively impacted by an RES under the proposed legislation, unless it is granted a renewable energy credit. The AF&PA said the proposal creates "winners and losers between existing renewable energy industries, such as the forest products industry, and new power generators."

Like other businesses, the forest industry has been negatively affected by the economic downturn, losing 190,000 jobs, a 15 percent reduction in its workforce, since 2006. The AF&PA is asking the public to voice their concerns to key senators about the current RES proposals and the proposed modifications to improve it. The Senate is likely to consider RES legislation this spring.