The energy legislation approved by the Legislature late Sunday night radically reorganizes the state’s energy market in favor of clean energy, calls for hydroelectric and offshore wind power contracts worth billions of dollars, and gives Massachusetts a shot at building a new offshore wind industry. What’s unclear is whether the energy bill will drive up utility bills. Here are some winners and losers in the bill that made it through the Legislature.
WINNERS
Rep. Patricia Haddad of Somerset, the third-ranking leader in the House, is perhaps the biggest winner. She blocked a major energy bill at the end of the Patrick administration because it didn’t contain any provisions for offshore wind. Now, a little over a year later, she lands a bill that could jumpstart an offshore wind industry in Massachusetts. Haddad is a pragmatist, not an environmentalist. She wants offshore wind for the South Coast to help ease the impact of the closing of the Brayton Point power plant in Somerset. She built a political coalition in support of offshore wind, something many thought impossible after Cape Wind failed to line up financing for its project. A key part of that coalition is Offshore WindMA, a trade group headed by a former New Bedford official named Matthew Morrissey. Morrissey, lobbyist Jim Smith, and representatives from the three companies holding federal offshore wind leases did an excellent job convincing skeptics that Massachusetts could land an emerging industry at a reasonable price for ratepayers.
Eversource and National Grid – The state’s two utilities made out very well on three fronts. Both companies hope to land contracts to deliver hydroelectricity from Canada to Massachusetts. They dodged a bullet when a Senate provision that would have barred the firms from charging their electric customers for natural gas pipeline expansion was excised from the final bill. (Both utilities, in partnership with Spectra Energy of Houston, want to build the Access Northeast pipeline project.) And the final bill retained a lucrative House provision paying the utilities a fee of as much as 2.75 percent of the value of whatever contracts they sign for offshore wind and Canadian hydroelectricity.
New Bedford – The Gateway City has been waiting for offshore wind to take off for years. Now the city, and particularly the largely unused state wind terminal there, have a chance to finally capitalize on the promise of offshore wind.
LOSERS
Natural gas pipeline opponents – Every senator and a majority of House members favored a Senate provision barring utilities from tapping their electric customers to finance a new natural gas pipeline. But the Senate nevertheless acceded to the demands of House leaders and dropped the provision. Still, the issue isn’t over yet. The Conservation Law Foundation is challenging in court the Baker administration’s position that the law allows utilities to charge their electric customers for a natural gas pipeline; a decision from the Supreme Judicial Court is expected sometime this summer.
Cape Wind – Jim Gordon, the energy developer behind Cape Wind, took another body blow in the energy bill. All he wanted was to bid on the energy bill’s offshore wind contracts. But Haddad and other House leaders wanted no part of Cape Wind, so they wrote the bill in a way to exclude the wind farm from the bidding process. The Alliance to Protect Nantucket Sound, which in the past filed suit after suit to block Cape Wind, hired former House speaker Thomas Finneran as its lobbyist to keep the Nantucket Sound wind farm out of the bidding. The Senate, favoring greater competition, did not exclude Cape Wind in its bill. But the Senate once again acceded to the House position in the final legislation. Gordon, in an email, said he was disappointed in the final energy bill and was evaluating his options. He declined to say whether he would file suit challenging his exclusion or whether he has another move up his sleeve. “The influence of fossil fuel billionaire Bill Koch and other wealthy NIMBYs and the decision by the Legislature and Baker administration to exclude a bonafide competitor with the most advanced, developed offshore wind project unfairly and arbitrarily subverts a long and comprehensive regulatory and judicial process,” he said in the email.
Who else should be classified as “losers” in the energy bill? Ratepayers. Unless the Supreme Judicial Court rules otherwise, Governor Baker’s Department of Public Utilities will force ratepayers to finance privately owned…that’s right…privately owned…natural gas pipelines. Why should the public assume the risks pipeline owners refuse to take? Those pipeline owners will enjoy all the profits while the ratepayers…thanks to a tariff…will take on all the risks…like the costs…including cost overruns and under utilized capacity. Clearly, protecting Massachusetts ratepayers just wasn’t on the legislative agenda. When Construction Work In Progress (CWIP) charges were levied on New Hampshire ratepayers’ electric bills to finance the Seabrook nuclear power plant’s construction …the public went into open revolt. New Hampshire’s newspapers, television station and public radio played a major role informing residents about what was going on. Once informed, ratepayers took action by contacting their elected officials demanding no CWIP charges. Given the public outrage, New Hampshire’s state legislature banned those charges. Here in Massachusetts, the news media barely acknowledges the enormity of the state’s DPU’s actions and the back room deals state legislators worked to make sure ratepayers were on the hook for any and all pipelines approved by the DPU.
The biggest losers are the ratepayers and the Associated Industries of Massachusetts (AIM) whose rates will skyrocket. It used to be that if you were selling electricity, you went to ISO-NE and placed a competitive bid. Now, all you do is scream clean energy and go to beacon hill to be selected by politically motivated legislators. If Beacon Hill wanted to transition to a clean energy future, why in 2008 did they excluded the only two reliable carbon-free energy sources (nuclear and hydro) from the mandate? Was it because only wind and solar interests who were being rejected by ISO-NE as unreliable and of little value?
After 8 years, surprise, surprise, wind and solar are proving useless in avoiding carbon, and complaints from Falmouth, Fairhaven, Kingston, and the Florida/Monroe area are mounting from the effects of wind turbine syndrome. Soon a whole section of Bourne, on the Plymouth border, will join them with the installation of 4 giant wind turbines on either side of route 25. In addition to the noise, that robs sleep, motorists on route 25 will be subjected to potential harm from ice-throws, and blade failures, and if there ever is a fire, 500 feet up in the sky, the road will be closed and the area evacuated for weeks.
Now, we have this legislation that selects hydro and natural gas to save the day. Why not nuclear instead of dirty natural gas? For technical reasons intermittent, variable wind and solar cannot be forcibly connected to the grid without full backup from flexible, dirty, natural gas. Baseload firm nuclear is in the way and must be killed.
We are not going to transition to a clean energy future as long as natural gas is the goto fuel on the grid. The transition will never come. Global warming is coming and with skyrocketing rates, and a dysfunctional economy, adapting to global warming will be much more difficult.
Charley Baker should veto this whole business instead of crossing his fingers that expensive hydro, imported from Canada, will save the day.
General agreement that ratepayers are big losers in this deal. The whole concept of customer choice has been stripped away by the legislature and the governor. The utility industry was deregulated so that ratepayers would no longer bear the risk of bad utility decisions. Now they bear the risk of huge and costly financial commitments made by an unholy alliance of lobbyists, special interests, politicians and bureaucrats. And once again the utilities continue to feed at the trough with a completely unjustified cut of the action. Apparently the legislature believes utilities need an “incentive” to comply with a state law.