PA Strengthening International Partnership to Spur Alternative Energy Development, Secure New Foreign Investments

PITTSBURGH, Feb. 15  /PRNewswire-USNewswire/ -- As part of his ongoing push to spark new investment in alternative fuels, Governor Edward G. Rendell signed a Declaration of Cooperation today with leaders of Germany's North Rhine-Westphalia Federal Republic, which will help Pennsylvania secure an energy independent future.
The declaration builds on the international partnership the two states have developed in recent years and pledges continued cooperation on economic and alternative energy matters.
At the signing, Governor Rendell said that by working together and sharing information and resources, the commonwealth will be poised to reap new foreign investments in Pennsylvania's alternative energy industry.
"With the agreement we signed today, Pennsylvania is positioned to make considerable gains in terms of developing alternative and renewable energies," said Governor Rendell. "The North Rhine-Westphalia Federal Republic is widely regarded as an international leader in alternative energy, and is anxious to build on the relationship we have  established because of our commitment to building an energy independent commonwealth.
"Pennsylvania is on the forefront developing and commercializing renewable energy resources and energy conservation technologies and practices," the Governor said. "Pennsylvania's growing clean-energy industry is gaining attention, which is leading to economic opportunities for the state. This agreement will help attract national firms and global businesses that will bring new investments, and make our existing businesses more competitive and create thousands of new jobs."
This new partnership pledges continued cooperation on economic issues and alternative energy development between the commonwealth and North Rhine- Westphalia Federal Republic. By developing stronger relationships between educational institutions in each state and building commercial contacts through seminars and trade missions, the two states will strengthen a longstanding relationship of mutual trust and cooperation.
Governor Rendell said the commonwealth has a roadmap for reaching energy independence, and pointed to his recently unveiled Energy Independence Strategy as a way to further grow the state's economy through foreign investments and thousands of new jobs.
The Governor said his proposed strategy will save consumers $10 billion in energy costs over the next 10 years; reduce the state's reliance on foreign fuels while increasing Pennsylvania's clean energy production capacity; and expand Pennsylvania's energy production and energy technology sectors to create more jobs.
The new strategy will help Pennsylvania cut the state's reliance on imported oil and it will further support the development of homegrown energy. This will make Pennsylvania and the country energy independent, by protecting our businesses and our residents from the effects of natural disasters and political upheavals throughout the world.
Cut Consumer Utility Bills
The Governor's energy initiative will cut energy costs for Pennsylvania consumers.  Electric generation rates can swing wildly during the course of the day and at different times of the year.  A recent study by PJM, the independent electricity grid operator that covers Pennsylvania, showed that cutting power consumption by just 3-5 percent during peak rate periods saves consumers across the state up to $230 million annually.
The Governor's initiative enables consumers to be smart about energy use by providing new tools to empower consumers and $244 million in new funding to help them install state-of-the-art energy technology.
   Smart Metering:  The Energy Independence Strategy would give consumers   the right to get smart meters installed in their home to give them a new   tool to reduce energy spending.  Utilities would be required to prove   they have aggressively pursued this strategy before getting approval to   build new generating plants.   Increase Household Energy Efficiency and Lower Bills:  Rebates would be   provided for customers turning in old, inefficient air conditioners and   refrigerators -- two of the biggest energy-using appliances in the home   -- for new models that use at least 15 percent less energy.  The creation   of a "Pennsylvania Sunshine" program will help residents pay for up to 50   percent of the cost of installing solar panels on their home or small   business.  At current electricity rates, the average household could save   about $600 a year with a 5 kW system, or solar panels that generate about   two-thirds of the electricity consumed in the home.   Make Pennsylvania Businesses More Competitive:  To stay in business in   our state, industry needs affordable electricity and rates that remain   relatively stable.  Soaring or dramatically fluctuating electricity costs   make it difficult to manage and grow a business.  That is the situation   manufacturers in Pennsylvania face as rate caps end and they are left to   deal with rapidly changing, "spot market," electricity prices.  Reducing Reliance on Foreign Sources of Fuel
The commonwealth is already a leader in the production of renewable fuels. One of the largest ethanol plants in the east will be built in the state, and approximately 340 million additional gallons of ethanol production are planned.  Similarly, companies in Pennsylvania are expected to produce 60 million gallons of biodiesel by the end of 2007, and other new plants being built are expected to produce an additional 170 million gallons within the next two years.  To put that into perspective, current national production of biodiesel amounts to 225 million gallons, putting Pennsylvania's total production near the top of all states.
   Enact PennSecurity Fuels Standards:  To guarantee that the shift to   cleaner alternative fuels occurs, and to bring economic stability to the   alternative fuels sector in PA, the Energy Independence Strategy will   codify the "PennSecurity Fuels Initiative" by requiring that we grow and   use one billion gallons of clean and renewable fuels. The new initiative   would mean that every gallon of gasoline sold in Pennsylvania would   include 10 percent ethanol, and every gallon of diesel would include an   increasing amount (up to 20 percent) of soy or other renewable oil.  Expand Pennsylvania's Energy Production Companies/Jobs
Clean energy is among the fastest-growing investment sectors in the U.S. and global economy.  In the last five years alone, investors have pumped $24 billion into clean energy projects -- a two-fold increase over previous investment levels.
To ensure that Pennsylvania's economy and our jobs are benefiting from the national growth in this sector, the Energy Independence Fund will:
   - Accelerate the role that Pennsylvania companies play in the production     of clean energy components and systems: By making over $100 million     available in the form of venture capital, loans and grants so     Pennsylvania firms can attract private sector investors and grow their     companies.  These funds may also assist in attracting cutting-edge     energy firms to the commonwealth.  All state funds will be matched at     least dollar-for-dollar by private sector capital.   - Initiate Clean Energy Economic Development Projects: New state     resources will target up to $500 million in state funds dedicated for     infrastructure improvements, construction, early project development     costs and equipment purchases undertaken to attract private investment     in energy-related economic development projects, including solar     manufacturing; advanced coal technologies; biofuels; and energy     conservation, efficiency, and energy demand management projects.   - Keep Energy Jobs Close To Home: The plan also makes improvements to the     historic Alternative Energy Portfolio Standard already on the books in     Pennsylvania. It makes clear that power companies can enter into long-     term contracts with the developers of wind farms and solar power arrays     so that those new and clean sources of energy can get financed and     built.  The Energy Independence Fund
The Energy Independence Fund will be used to support the following clean energy activities:
   - $244 million - Household appliance rebates and PA Sunshine Grants   - $106 million - Venture capital, grants and loans for expansion of     energy companies   - $500 million - Clean energy projects and development or equipment costs     for specific energy economic development projects
The Energy Independence Fund will be capitalized by a systems benefits charge on electric power consumers.  Charges of this kind are already in place in 15 states and the District of Columbia.  At the rate proposed, Pennsylvania's charge would be lower than all but two of these jurisdictions.
The systems benefits charge is proposed at $0.0005 per kWh of electricity used (five-hundredths-of-a-cent or .5 mills). This charge would cost the average residential customer 45 cents per month, the average commercial customer about $3.00 per month and the average industrial customer $74 per month.  For large industrial customers, the fee would be capped at a maximum of $10,000 per year.
The Energy Independence Strategy as a whole is expected to save consumers nearly 15 times more than the cost of this fee.  The average residential customer is expected to save $73 per year, the average commercial customer $425 per year, and the average industrial customer $10,500 per year.
   CONTACT:   Michael Smith   717-783-1116   Neil Weaver (DCED)   717-783-1132
Pennsylvania Office of the Governor