Good morning Mr. Chairman, Members of the Committee - thank you for the opportunity to testify before today. My name is Paula Soos and I am the Director of Government Relations for Ogden Energy Group. Ogden builds, owns, and operates waste-to-energy facilities. We currently have 27 facilities in the US, including one located in Alexandria and one in Fairfax County. Combined, these two facilities process approximately 4,000 tons of municipal solid waste per day to generate up to 102 megawatts of renewable electricity - enough electricity to power over 100,000 homes.

Waste-to-energy (WTE) facilities are integral pieces of municipal infrastructure. These facilities serve two social purposes - they safely manage municipal solid waste for our client communities, while generating electricity. While renewable energy generation is a byproduct of the solid waste management role, it is no less significant, and plays a large role in the economics of these facilities. The revenues from electricity sales divert back to the communities in which they serve. Those communities then establish the cost of municipal solid waste disposal based in part on those revenues (in addition to other factors such as revenues from recovered ferrous metal sales, operating costs, etc). It is important that these facilities not be viewed merely as electricity generators, because clearly their societal role is much greater.

The issue I would like to discuss today is that of renewables, and to relay the importance of the development of a renewables program that not only encourages the development of new renewables, but provides support for existing renewable technologies, such as waste-to-energy.

The issue of renewables is working its way to the forefront of the restructuring issue in federal and state restructuring plans. Federal legislation proposes to effectively end the Public Utility Regulatory Policy Act and with it, any incentive for utilities to buy renewable energy. In response, federal and state proposals, and in fact new state laws, support other incentives, such as a renewable portfolio standard (RPS). An RPS would simply require that a specific amount of the electricity used in the state would have to come from renewable energy sources. (The federal definition of renewable includes, at a minimum, wind, solar, hydro, geothermal, and biomass technologies including waste-to-energy and landfill gas).

Without an incentive to buy power generated from MSW and other renewable producers, utilities may seek to compel renegotiation of contracts offering significantly lower revenues to local governments . This would result in higher costs to the taxpayers (any loss in energy revenue would result in a necessary increase in revenue - either from taxes or from solid waste disposal fees). Utilities also may oppose any effort to buy renewable power when existing contracts come up for renewal leaving renewable generation infrastructure in jeopardy which could also result in increased costs to the public. Legislators around the country have been correctly concerned with avoiding a cost shift from business to residential customers during electricity deregulation. It is important to ensure this does not happen through residential trash disposal rates.

To address a plan that promotes a renewable program is important, although, addressing a renewable program that includes waste-to-energy is imperative. Revenues from these waste-to-energy power purchase agreements flow directly to the public sector - in our case, our partners in the City of Alexandria and Counties of Arlington and Fairfax. These revenues help to decrease the cost of trash disposal in the community.

States that have already passed restructuring measures which include a renewables program and maintain WTE as a renewable technology include California, Connecticut, Delaware, Maine, Maryland, Massachusetts, Nevada, Oregon, Pennsylvania, New Hampshire and New Jersey. Federal initiatives regarding restructuring also embrace renewables and a renewable portfolio standard. It is important to note that, without consistent policy in this state, some Virginia energy producers (in this case, local units of government) would be disadvantaged in the new, interstate energy market.

We ask that the committee consider following suit and initiating the use of a renewable portfolio standard in implementing provisions of the recently passed electricity restructuring legislation, and in maintaining the existing federal renewable definition..

Thank you again for the opportunity to address you this morning and I'll be happy to answer any questions that you may have.