Parker: Demand drives energy costs up

Published 8:47 pm Friday, January 9, 2009

Public Service Commissioner Susan Parker sees an energy crisis in the future of our state and country if something isn’t done to prepare for that possibility.

One main reason is that the price of creating energy has increased tremendously over the last few years. The demand for coal and natural gas, which are two large producers of energy, has skyrocketed.

“Countries like Japan, China and India are building new energy plants,” Parker said. “China is building a new coal energy plant every week. There is a much greater demand in these countries to have reliable energy sources so their industry can develop. They are kind of going through their own industrial revolution.”

However, that has caused private electric companies like Alabama Power difficulties. Parker said the power company has incurred a $300 million debt because the power rates aren’t enough to keep up with the rising cost of coal. In recent months, the Public Service Commission allowed a rate increase so the company can recoup some of the costs. This commission regulates private companies that have monopolies. Some of the companies are Alabama Power, Alagasco and several phone companies.

Alabama is also one of the few states that don’t have a reusable portfolio standard for its energy production. Currently, 34 states have set up a standard to use more reusable energy sources, which include biomass, solar or wind power.

Parker believes that the federal government will eventually place a national reusable portfolio standard, which could negatively affect states like Alabama.

“We don’t have the kind of sustained wind, sunlight or amount of biomass that would make it cost effective for us to use this kind of energy,” Parker said.

Parker hopes the nation will build a national energy transmission highway that will connect all the regions together.

“Currently, we cannot send any electricity outside of the southeastern region. If there is a way to send wind energy that is collected from North Dakota or South Dakota, then the wind energy may become cost effective for the entire country,” Parker said. “We don’t want to do anything that could negatively affect our economy, but we must find a way to use more reusable energy.”

Parker believes the nation can do three things to help improve the energy situation — improve energy efficiency along with more conservation, putting more nuclear on the map and investing in technology.

Disasters such as Three Mile Island and Chernobyl have scared the U.S. away from using nuclear power, but Europe never gave up on nuclear power. About 50 percent of Europe’s power was created by nuclear power plants.

“We have better and safer ways to deal with nuclear power now,” Parker said. “It can be one of the most cost effective forms of energy we can have.”

— Brent Maze can be reached at