East Bay Energy Consortium: What Happened and What is Next
Although the EBEC bill did not pass the House last week, its leaders would like to see it reintroduced this winter.
In 2009, the East Bay Energy Consortium (EBEC) was founded in order to explore the feasibility of combining resources across the nine East Bay municipal lines to invest in renewable energy sources. A bill to establish the group as a non-profit governmental entity, passed the Senate, but last week it was held before it got to the House.
The House Environment and Natural Resources Committee determined it should be "held for further study," which essentially, killed the bill.
“It was a bit of a disappointment that it didn’t come out of the committee to be heard on the floor,” said Jeanne-Marie Napolitano, chairwoman of the EBEC Board. Napolitano also serves as a City Council member for Newport.
The Board will meet within a month to determine next steps and Napolitano said she would like to see the board decide to reintroduce the bill. She said although there were originally valid concerns, several revisions addressed the major issues.
“We all had concerns,” said state Senator Louis DiPalma, who introduced the bill in the Senate. He said if the EBEC approved, he would also like to reintroduce the bill.
DiPalma said the majority of the concerns arose after the recent news that 38 Studios defaulted on a $75 million loan to the EDC. The bill initially proposed the Consortium would be a subsidiary of the EDC, which raised concerns that if they defaulted on their loans, Rhode Island taxpayers would be held liable once again.
DiPalma said the language was changed so that the consortium would be a stand-alone entity and would be responsible for its own debts.
The new language was modeled almost word for word after the Rhode Island Interlocal Trust (“The Trust”), which is an intergovernmental insurance risk-sharing pool.
“Think of it as a blueprint,” said the senator. “It is a two page bill.".
Napolitano said since the concerns had been addressed, it was important to educate Representatives, so they would understand Rhode Island taxpayers were no longer liable. She said only a handful of legislators attended an informative breakfast that was held to explain the changes.
Another educational opportunity was lost when they were not allowed to testify at the last hearing; a decision that she attributed to what she called a “mystery letter” from Gov. Lincoln Chafee. She said a board member found the letter on the packets prepared for the legislators.
The governor's letter read, “There is language in the legislation that I cannot support, including creating EBEC as a subsidiary of the Economic Development Corporation and the potential financial exposure the State would be Subject to regarding the bond financing of this project.”
DiPalma said the letter was probably a “contributing factor” in the decision to remove the EBEC’s testimony that day.
“It was very obvious he had not seen the new legislation,” said Napolitano. “It’s very unusual to come in and try to kill something like that.” She said after waiting two and a half hours, they were taken “right off” the agenda.
Four days later, the governor’s office wrote Napolitano an email saying Chafee supported the bill now that it was modeled after the Rhode Island Interlocal Trust.
“I always felt that he was a governor who believed in renewable energy,” said Napolitano.
DiPalma said one rumor he had heard was that resident's electricity bills would become more expensive. He said that and other rumors are not accurate, because the bill did go into detail of the types of technologies or particular by-laws. It established the group as a legal governmental entity, similar to how a new business would incorporate, he explained.
The intent of the group is to not only invest in renewable energy, but also save cities and towns money, said DiPalma.
"My goal is to interact with the group and bring it back in January, in some way, shape or form," he said.