Maine’s Biggest Utility Must Change to Make Way for Clean Energy
Maine is at a crossroads in its climate and energy future. For the state to move forward and embrace a consumer-friendly, low-polluting clean energy future, its biggest utility, Central Maine Power (CMP), must dramatically change the way it does business and do much more to support consumer and community access to solar, wind, building weatherization, and clean technologies like electric vehicles and heat pumps. Up to this point, CMP has frequently blocked these measures. It is time for CMP to change.
As a whole, Maine has struggled to make progress toward a clean energy future, falling behind its New England neighbors despite strong calls from Mainers and their communities for more clean solutions. Governor Mills understands the threats climate change poses to Maine’s economy and way of life. She has committed the state to the Paris Climate Accords among other steps. But for her attempts to gain ground, the state’s utility companies must also reform and stop putting roadblocks in the path to progress.
For instance, Maine prevents its communities from adopting advanced building energy codes. Maine bars community choice aggregation and has consistently blocked efforts to more fairly compensate solar customers for the power they create. CMP must align its investments and rates with consumer interests so that they have access to clean energy options like rooftop and community solar.
CMP’s request for a certificate from the Maine Public Utilities Commission (PUC) for a proposed power line to transmit hydroelectricity from Canada to New England has raised a host of issues directly tied to core Maine concerns: the urgent need to reduce climate pollution from energy generation; reforming the role of the state’s utilities, particularly Central Maine Power; and whether the intrusion of this project in the Maine forest is appropriate.
Acadia Center is involved in issues surrounding the project because of the importance of these issues to Maine’s energy, economic, and consumer future. In the PUC proceeding, Acadia Center has joined with other parties to recommend that if the PUC issue a certificate for the project, it should impose a set of commitments on CMP to support clean energy and consumer access to new technologies. These conditions would require CMP to:
- Provide measurable benefits to Maine ratepayers and affected communities.
- Support Maine’s efforts to expand its clean energy economy.
- Increase access for Maine residents to clean transportation and clean distributed energy resources such as solar.
- Make CMP’s planning and decision-making more transparent to expand opportunities for alternative investments in solar, storage, and efficiency.
- Support a study examining pathways to achieve regional decarbonization goals.
Outside of the issues before the PUC, a review of whether the land use and siting impacts of the project are tolerable is pending at the Department of Environmental Protection. Acadia Center looks to the efforts underway by organizations engaged in the Department of Environmental Protection permit review process to determine if the impacts to Maine’s forests and natural landscape are acceptable. Acadia Center does not believe this project should proceed unless there is satisfactory resolution of the land use issues, in addition to consumer benefits, and the need by the state’s largest utility to work in concert with clean energy and climate values.
In addition, the energy companies involved—CMP, Avangrid, and Hydro-Quebec—must change in their willingness to provide transparent information, to allow the public to determine that the regional climate benefits of the project are real and will bear out over time.
Conditioning the PUC certificate with added requirements on CMP is only the beginning of the changes in direction CMP must undertake. The company cannot cite the climate benefits of this proposal while also blocking clean energy options for Maine consumers and communities. In order to decide if the project is good for Maine, the Northeast, and the global climate, the public needs to know more.
Acadia Center’s statements on the line and the proposed settlement filed with the PUC are available here.
CMP sweetens the deal, picks up support from Mills and others for $950M project
Central Maine Power announced this morning it has signed a stipulation asking the Maine Public Utilities Commission to authorize its $950 million transmission project to deliver Canadian hydropower through Maine to Massachusetts.
The proposed settlement includes conditions that Acadia Center and Conservation Law Foundation sought directly from CMP under a Jan. 30 memorandum of understanding signed by CMP President and CEO Doug Herling and CMP Vice President, Treasurer and Controller Eric Stinneford.
Read the full article from Maine Biz here.
Op-Ed: Raise the Renewable Portfolio Standard
“As the legislative session draws to an end, state lawmakers are considering bills that would increase the annual growth rate of the Massachusetts Renewable Portfolio Standard (RPS). As these proposals move ahead, it is important that decision-makers not be deterred by unsubstantiated claims made by opponents that an RPS increase is incompatible with procurements of hydroelectricity required by statute (Section 83D) or will undermine compliance with the state’s Clean Energy Standard (CES). This argument against an increase is a red herring based on a mischaracterization of the relationship between clean energy policies designed to fulfill different, but complementary objectives.”
Read the full article from CommonWealth Magazine here.
Public Scrutiny Needed for Eversource Northern Pass Project
BOSTON—Acadia Center is calling for a public review and full transparency following yesterday’s announcement that Northern Pass Transmission’s hydro-only bid, a partnership between Eversource and Hydro Quebec, was selected as the sole winner of the Massachusetts Clean Energy RFP.
The RFP, called for by a 2016 energy law, sought clean energy for about 17% of Massachusetts’ annual electricity needs. Although more than 40 bids were submitted in the summer of 2017—including several with a blend of on-shore wind and hydroelectricity, the Department of Energy Resources (DOER) and a group of Massachusetts utilities, which included Eversource, chose one controversial project, owned in large part by a subsidiary of Eversource. As the winning bid, Eversource and Hydro-Quebec will begin the process of negotiating long-term, multi-billion-dollar contracts with Eversource, National Grid and Unitil, the other distribution companies.
“Acadia Center is disappointed but not surprised that the process has resulted in the recommendation of the Northern Pass project,” said Daniel Sosland, president of Acadia Center. “Acadia Center has long asserted that clean energy bids should include the region’s wind resources and not only hydropower imports and has further been concerned that having utilities review bids in which they have a financial interest creates a clear conflict of interest that undermines public confidence in the process.”
Acadia Center supported the 2016 energy law and the Commonwealth’s pursuing a large-scale procurement of clean energy, particularly arguing for environmental protections, a preference for a blend of new renewables and hydro, and guaranteed winter energy delivery to control price spikes, all of which the statute and RFP specified. One provision that Acadia Center argued against—but was still allowed in the 2016 energy law—was allowing the utilities to bid for the contract and serve on the selection committee.
“Under the terms of the RFP, the selected project was to provide the greatest benefit with limited risk to Massachusetts ratepayers. We don’t know the relative benefit-cost ratios because the price terms are confidential, but choosing only one project from an existing importer of electricity has major risks,” said Amy Boyd, Senior Attorney at Acadia Center. “Hydro-Quebec has previously curtailed power to New England in winter months, when demand in Quebec is highest. Similarly, reliance on a single project has its own risks. Northern Pass Transmission faces serious opposition due to its land use impacts and its projected in-service date has been delayed previously.”
After the contract is negotiated it will be reviewed by the Department of Public Utilities (DPU), and the review must include a report from an independent evaluator and the participation of the Attorney General’s office. Under the statute, Eversource is also eligible for an additional incentive of up to 2.75% of the contract price for its share of the energy, as one of the contracting distribution companies. The public must be privy to any evaluation of the fairness of this and other aspects of the contract.
“Acadia Center believes that a full public report from the statutorily required independent evaluator and scrutiny by the Attorney General are important next steps. The public needs to have full confidence that this was a fair process and the benefits of other bidders were evaluated reasonably. The current ongoing procurements for offshore wind and future procurements are even more crucial to progress towards a clean energy future,” said Mark LeBel, Staff Attorney for Acadia Center. “If this contract is approved, the DPU should deny Eversource an additional incentive as a distribution company. Ratepayers don’t need to give Eversource additional money as a backstop for a contract where they are also on the other side.”
Amy Boyd, Senior Attorney
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Mark LeBel, Staff Attorney
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Krysia Wazny, Communications Director
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Importance and Implications of Massachusetts’ Clean Energy Bill
With just a few hours to go in the legislative session, the Massachusetts legislature passed a bill that will significantly reduce carbon pollution, reshape the regional power system, and foster new technologies that will play a large role in meeting future energy needs. The main provisions of An Act to Promote Energy Diversity (H4568) center on providing long term contracts for offshore wind, hydroelectricity, and other forms of renewable energy. These contracts will enable financing to cover the construction costs of grid-scale clean energy sources and electric transmission to connect the new projects to demand centers. The final bill meshed a streamlined proposal from the House and more ambitious and comprehensive package from the Senate to include contracting and a number of complementary pieces, most notably support for energy storage.
The core of the bill requires utilities to solicit long term contracts for 1600 megawatts (MW) of offshore wind. The procurement is the largest ever in the United States (or the hemisphere for that matter) for offshore wind, launching a brand new industry that the Department of Energy estimates could support 54,000 jobs and $200 billion in economic activity by 2030. Some of these jobs are already starting to materialize, with the arrival last weekend of a purpose-built construction vessel for Rhode Island’s Block Island Wind Farm.
With relatively shallow water close to major population centers, the Eastern Seaboard is prime location for offshore wind, and steady wind speeds allow offshore wind farms to operate at high frequencies (38%-52% capacity factors according to DOE). Once fully online and operating 45% of the time (midpoint of DOE range), the new offshore wind will produce about 6.31TWh of energy, or approximately the output of the soon-to-close Pilgrim Nuclear power plant.
Hydroelectricity and Other Renewables
The other main piece of the bill requires solicitations for 9.45 terawatt hours of hydroelectricity and other energy sources eligible for Massachusetts’ Renewable Portfolio Standard (RPS). The solicitation builds on an existing collaboration with Connecticut and Rhode Island that has led developers to put forward a diverse array of proposals for onshore wind, hydroelectricity, solar, energy storage, and pairing of multiple resources. Opening procurements up to diverse clean energy resources was a key priority for business, health, consumer and environmental organizations collaborating to provide input on the legislation through the Alliance for Clean Energy Solutions, an effort Acadia Center co-led with the Northeast Clean Energy Council. Broadening procurements beyond hydroelectricity alone allows for innovative approaches and forces competition that will bring costs down. Pairing of resources also helps ensure optimal use of new transmission lines needed to connect hydroelectricity from Canada, wind from Northern New England and Upstate New York, and grid-scale solar from areas where land is available.
The combined impacts of the clean energy procurements are profound. The wind farms would total more than three times the capacity of the long-stalled Cape Wind project (which was excluded from participation), and the procurement for hydro and other renewables will likely lead to an additional (~1000MW) transmission line designed for the first time to access low carbon energy, and potentially a number of smaller projects. If the new energy supplies displace natural gas, they will avoid 7.9 million tons of carbon pollution, bringing electric sector emissions down 56% from 2012 levels and helping Massachusetts make progress toward the deeper 80% reduction across the entire economy required by 2050.
Massachusetts’ legislation and joint effort with RI and CT also signify a deeper shift in planning for the region’s energy future. Significant progress has been made towards advancing energy efficiency and other customer-sited resources like rooftop solar, but over time New England will need to bring online significant additional quantities of grid-scale renewable energy resources to replace fossil fuel power plants. Additionally, there will be increased demand for clean electricity as electric vehicles replace gasoline-powered cars and heat pumps replace oil and gas for heating.
New England has previously explored steps needed to enable large quantities of grid-scale renewables (up to 12,000MW of wind and hydroelectricity in a 2010 analysis for New England’s Governors), and the Massachusetts legislation is likely to build momentum for reforms. One clear step is to plan transmission for renewables, but this planning must be paired with reforms to improve transparency and reduce high costs of the current model that encourages over-building transmission for reliability when smaller scale, clean, and less expensive alternatives exist
Another promising approach for enhancing clean energy and improving the operation of the grid is to deploy energy storage. Energy storage will facilitate integration of variable resources like wind and solar, providing power when the breezes die down or clouds roll in. Storage also can avoid the need to build expensive grid infrastructure that is only needed a few hours of the year to meet peak demand. As described in another Acadia Center blog, storage provides the equivalent of warehouses for the world’s largest supply chain (the power grid), which currently works on an overpriced instantaneous delivery model. The legislation recognizes the breakthrough potential of energy storage, and directs the Department of Energy Resources to set 2020 utility procurement targets for storage, building on leadership the Baker Administration has already shown through the Energy Storage Initiative. If Massachusetts’ procurement is of similar scale to California’s successful program, utilities would need to contract for 330MW of storage, which would both help rationalize the grid and provide a boost to an industry with enormous potential and promising storage technologies being developed in the Commonwealth.
The legislation includes important provisions to repair natural gas leaks but did not include language prohibiting the unprecedented proposal to require electric ratepayers to subsidize new gas pipelines. The legality of this risky and unnecessary approach will now be decided in the courts, with the fate of the controversial Access Northeast project hanging in the balance.
Additional provisions of the bill include commercial clean energy financing through tax assessments (CPACE) establishment of a nuclear decommissioning advisory council, net metering for small (under 2MW) hydroelectric facilities, expanded eligibility for fuel cells and waste-to-energy under the Alternative Energy Portfolio Standard.
In all, the legislation represents a major commitment to clean energy and reducing carbon pollution. The procurements set in motion by the bill will decarbonize Massachusetts’ electric sector and accelerate the transformation of the regional energy system. At the same time the bill provides vital support for two new technologies — offshore wind and energy storage — that will put the Commonwealth at the forefront of industries that will power the energy future.