Idaho Department of Lands decides on rules governing conservation of crude oil and natural Gas in Idaho.

In mid-May, the Oil and Gas Conservation Commission instructed the IdahoDepartment of Lands to start a negotiated rule making to update the existing rules for recovery of natural gas and oil deposits in Idaho. Those rules had been put in place twenty years ago before the current discovery of potentially economic reserves of gas and oil.  Industry, environmental groups, county governments, individuals and state agencies produced a draft rule which the Commission has accepted and which will be submitted to the 2012 session of the Idaho Legislature for final approval.

On November 15^th, the Commission met to take testimony on the proposed rule and vote on it.

The meeting opened with a presentation by Eric Wilson, Idaho Department of Lands Program Manager-Minerals at the meeting of the Commission, which is made up of the Governor, Secretary of State, Attorney General, Superintendent of Public Instruction, and Controller.

It was time to review the existing rules and the negotiated rulemaking process allowed many stakeholders to be heard.  These rules are useful and usable and will apply to the entire state.

Wilson outlined some of the changes made to the current regulation:

•  Adding a15 day public comment period on applications to drill
• Handling well treatments, called fracturing or fracking, in two sections: application and approval.  Use and disposalof volatile compounds is also regulated.
• Adding pit requirements and surface reclamation measures to protect fresh water;
• Requiring reports of actual amounts of fluids used intreatment of wells (fracturing) as well as notification of treatment anddisposal sites of fluids;
• Increasing bonding amounts and additionalbonding;
• Adding a 3-tiered system for blanket bonds.  Wells that have been inactive for 24 months must have individual bondsrather than be under a blanket bond;
• Adding a new section on surface owner protections that is based on case law throughout the states;
• Updating casing requirements, pit constructionstandards, short and long term standards;
• Class 2 injection wells will no longer beallowed.
• Adding very specific standards on improved wellplugging
• Including new reclamation standards were included.

Testimony included support for the new regulations, pointing out this willbe an economic benefit to the counties and the state.  Others said we need regulations on this activity butdon’t need to regulate the industry out of the state.

Others expressed concern that we were rushing to develop these fossil fueldeposits and needed to take care that we did not leave poisons behind thatwould last for a long time.  Anotherconcern was the issue of lining pits which needs to stay in the rule.  There was support for more work on theblanket bonding section and concern over the use of carcinogenic chemicals inthe fracturing fuels

The commissioners asked several questions about disclosure of ingredients inthe fluid; blanket bonding; the APAprocess and timeline and pointed out that these rules will not be in placeuntil after the Legislature has approved them. The current temporary ruleswould stay in place until then.

Lt. Governor Brad Little, acting as chairman in the absence of the Governor,recused himself because of a potential conflict of interest.  The rest of the commission voted to submitthe pending rule to the Idaho Legislature for approval.

For official rules, see this website: http://adm.idaho.gov/adminrules/rules/idapa20/0702.pdf

Committee takes comment on Idaho's Energy Plan

On Wednesday, consumer associations, conservation organizations and private individuals gathered to offer testimony to the legislative interim committee on Energy, Environment and Technology on the draft 2012 energy plan.


The Reality of Renewable Energy Credits
Annie Black, a Boise resident and former Idaho Power employee and regulatory consultant offered testimony on  renewable energy credits (RECs) and advocate for transparency with rate payers


Black is concerned that Idaho's energy conversation should be about where our energy is coming from.  She refers specifically to what she says is a difference in the generation of fuel mix and the power delivered to Idaho Power customers.  When local rate payers believe that the energy they consume is renewable energy, they don't realize the credits for those renewables have been sold to other states that have renewable energy portfolios.


The question, Black admits, is largely academic, but with one of the tenants of the plan being energy awareness on behalf of consumers, it's an important point.

"​Geothermal and wind energy aren't making it to my electrical outlet because Idaho Power is required to sell renewables. ... stripping RECs from renewables by selling them to other states fundamentally changes how we consider the environmental benefits.  ​If you think you are getting geothermal or wind energy as a part of your fuel mix, you're not alone," Black says.  "RECs have muddied up the waters.  We need to differentiate between generational fuel mix and delivery fuel mix."

​Representative Wendy Jaquet tried to clarify: "You're saying that if I really want to promote green energy in my state, I should be wanting to know where those RECs are going and generate a dialogue about where my energy is coming from?"


Black concurred, "what I'm saying is let's be all on the same page. I'm advocating that if we are selling our renewable energy in the state, we should be aware of it."

Representative Reed DeMordaunt wondered about the renewable energy market in Idaho.
"Isn't this about getting about getting more people to check the REC box on their power bills?"  


Black noted that in her tenure at Idaho Power, the utility came forward to the PUC and asked for the opportunity to offer a component of renewables in their deliverable energy.  The PUC decided against this, Black says, specifically saying "we don't have a REC market in Idaho."


Advocating for Seniors
Lynn Young of AARP Idaho says her organization wants to ensure consumers have access to affordable energy.  While she says  the plan cites affordability it fails to address it in a substantial manner.  She says older americans devote a higher percentage f their income on home heating.  about 1 in every 4 of low income seniors spend 15% or more of their income in home energy.  


"Some of our seniors have to make regular decisions between paying their utilities or prescriptions, and end up exposing themselves to chronic health conditions and premature death due to exposure to heat and cold."

Young recommended appointing a consumer advocate.  Senator Elliot Werk wondered if the Public Utilities Commission considers their staff to be advocates for the consumers. 


"The PUC does the work they've been given to do," Young said, "but we don't believe they carry a role to be an advocate for the consumer. We feel a need to have the same representation that other groups have."

She noted Idaho is one of eight states nationwide and the only one in the west that doesn't have a consumer advocacy office. 


Ben Otto of the Idaho Conservation League served on the energy conservation task force of the ISEA.  He, too, advocates for the idea of a specific consumer advocate.  In his job, he says he frequently intervenes to represent residential customers to advocate on efficiency and conservation.  The system for reimbursing intervenors is cumbersome and drawn out, leaving individuals at a disadvantage compared to large corporations and other organizations that have specialists and lawyers at their disposal.


Conservation Groups Weigh In, Question Public Process
From the standpoint of the Idaho Conservation League, Otto highlighted specific areas of priority for the legislature to put real policies into place: tax incentives, regulatory policy and energy efficiency.


"The potential for efficiency is vast, the price is right, it addresses critical issues such as energy independence for Idaho," he said.

Lisa Young, of the Snake River Alliance noted that her organization objected to the informal nature of the revisions made to the first draft of the Idaho Energy Plan at an early October meeting.

Public Utilities Commissioner Paul Kjellander noted that, despite the lack of a public record of comments made at the meeting, in his opinion nothing underhanded had taken place.  


"We may not have seen minutes only because there hasn't been a subsequent meeting of the board.

Regarding the plan itself, the nuclear watchdog agency pointed out several specific points of interest:
- The treatment of energy efficiency in the latest draft of the plan, wherein language describing energy efficiency as of the  "highest priority" was downgraded to "high priority" where "cost effective."
- The removal of language on incentives for renewables 
- The removal of policy recommendation that would encourage customer owned combined heat/power source development
- Language specific to monitoring and exploring all advanced energy technology

Transportation Group: Don't Forget Community Planning
Heather Wheeler, director of the Community Transportation Association of Idaho (CTAI) outlined energy efficiencies and fuel conservation measures that should be incorporated into the plan:


Petroleum and transportation - restore natural gas purchase of high efficiency and alternative fuel vehicles to the plan.


Incentives - restore language that encourages alternative fuel and conservation of fuels to drive the market toward meeting energy efficiency goals.


Don't delete language about local transit tax options  - which will greatly decrease fuel consumption.


Don't delete recommendations that focus on conservation through community and transit planning.  Idaho should encourage land use planning that reduces vehicle miles traveled.



Interim Committee reviews recommendations, extends comment period
The committee took these and more than 80 other comments logged online into consideration the following morning as they went through each recommendation of the draft 2012 plan.   The committee will continue the discussion at their November 21st and 22nd, and has extended the public comment period through to November 18.


Among several areas of particular concern during the meeting was language regarding transmission.  Senator Werk described transmission's role in the Draft Energy Plan as akin to the act of capturing a bridge in a battle - a small act, but critical to accomplishing broader objectives.


"it's interesting to look at the proposed language, which is limited to what the utilities should be doing ... where it should be focused on broader policy implications," he said.


Also discussed was language concerning the priority level of efficiency and conservation, incorporating renewables where cost effective, and keeping language as broad as possible to allow for incorporation of new technologies, recognizing the role they play in a robust energy portfolio with conventional resources.


The subject of local option taxes for transportation projects was discussed as well, with policy makers noting that this subject is likely to come up in the upcoming session.


A local option tax bill failed to pass the House in 2009.  Although supported by many legislators, the bill's provision that such option taxes require a two-thirds vote rather than a simple majority was something several potential supporters of the bill sited as their reason for voting against it.


Comments on the 2012 Draft Energy Plan can be emailed to Mike Nugent of the Legislative Services Office at mnugent@lso.idaho.gov by 5 pm, November 18.