Recently the Governor of Massachusetts gave a very inspiring speech describing both the affirmative steps that have been taken to address the challenge of building a thriving and clean economy in the Bay State and the challenges that still lie ahead.

The occasion was an event organized by the New England Clean Energy Council and hosted by high-tech startup FastCAP Systems and featured an array of interesting speakers leading up to Governor Patrick including a young woman who is the sole female crew chief at local energy efficiency provider Next Step Living, the Town Administrator of Scituate MA discussing their successful efforts to build a wind turbine and the toughest of environmentalists, Andrew Ference of the Boston Bruins.

The toughest environmentalist around: Boston Bruin Andrew Ference, speaking before Gov. Patrick, May 30, 2012

Governor Patrick, as has been reported, used the occasion to respond to criticism of the energy policy that his administration, and the Federal government, have been pursuing:

Our strategy of fostering a clean tech industry is sometimes derided as “picking winners and losers.” In fact government is doing what it is supposed to do: helping the state make the most of our competitive advantages. Investing in innovation, education and infrastructure. Putting policies in place that encourage private investment to meet our shared needs, creating jobs and leaving the Commonwealth better than we found it. And as I said, it’s what Americans have always done to shape our energy future.

 And by the way, let me tell you that I have heard enough about Evergreen – and for that matter about Solyndra. We are not always going to score. But we are never going to score if we don’t get in the game. One company that comes up short hardly discredits an initiative that has spawned 5,000 thriving companies and nearly 70,000 jobs and counting. Critics would do well to remember that I used to work in the oil industry, an industry that frequently drills dry wells. When the critics are ready to talk about the massive subsidies for Big Oil even when they drill dry wells, then I am ready to have a serious conversation about the tiny subsidies we use to foster a new, American-grown industry in alternative energy.

 Whether we like it or not, there are going to be winners and losers when it comes to clean energy in the 21st century. The winners will be those places that did everything they could to be ready for change, that created an atmosphere for and a culture of innovation.

But his message went beyond recognition of the growth in the clean energy sectors of the Massachusetts economy.  He also recognized “Winners don’t stand still, and if we want Massachusetts to stay a winner in clean energy, there is much more for us to do.”

His specific action items included putting solar panels on more rooftops and closed landfills, extending contracts to large-scale renewable energy developers,redoubling our commitment to squeezing every bit of efficiency out of our energy use and continuing our support of and participation in the Regional Greenhouse Gas Initiative, which he accurately described as “the single most successful cap and trade market in the country.”

All laudable goals, which he tied to moving forward a good energy bill in the Massachusetts legislature.

The Governor is right in taking pride in what has been accomplished in Massachusetts, most especially the ramp up in solar energy generation and energy efficiency. He is also correct in seeing these successes as a good starting point for even more action – and CLF as an advocacy organization is intently focused on this question of “what is next”, an attitude that perhaps led to the Governor’s public characterization (in response to a question at the same event) of CLF as an organization that shares his goals but “can be a bit of a pain in the ass . . . although that means you are doing your job.”

The next steps before us are clear, although not easy.  They range from appropriately funding the transit systems that provide clean and affordable transportation, to fostering urban “smart growth” to the essential (but wonky) energy policy details of expanded long term contracts for renewable energy projects across New England that supply energy to Massachusetts and expanded net metering and property tax relief for small renewable energy projects.

The time has come to have the courage of our convictions and the confidence to build on a winning record – recognizing that the struggle to build a thriving new clean energy economy that puts us a trajectory to meet the challenge of global warming will not be easy but that it is a challenge we can’t avoid, and that can bring our best.

A sober, clean and depressing article from Inside Climate News details how scientists who work on climate are  grappling with the science and reality of global warming puts me in mind of a classic science fiction movie paradigm – they know something terrible is unfolding, but no one will listen ! Or in this case, as notes John Reilly co-director of the Massachusetts Institute of Technology’s (MIT) Joint Program on the Science and Policy of Global Change, most scientists studying climate change today are viewing “the seemingly unstoppable rise in global greenhouse emissions” with “increasing alarm.”
 
 

The Senate Study Commission on Sustainable Transportation Funding met on Friday, June 1, for what may prove to be its last meeting for this legislative session. (I sit on the Study Commission as a full voting member.) At the June 1 meeting, the Study Commission approved four separate recommendations; each separate recommendation was approved by a vote of 9 members in favor, 1 member opposed. All four recommendations were deeply disappointing.

Unfortunately, the gist of all four recommendations is that the Study Commission recommends waiting until after RIPTA completes its anticipated Comprehensive Operations Assessment (COA) before the Study Commission recommends any new, significant, sustainable funding for RIPTA. The fourth recommendation sums up the gist of all four: “Upon completion of the COA and pricing analysis [that is, zone fares], develop a comprehensive, sustainable funding approach for inclusion in the FY 2014 budget.”

In other words: nothing meaningful should happen now; let’s wait until after the COA is done; and then (maybe) recommend something in the future. The inevitable result will be that RIPTA will face major service cuts as early as the end of this calendar year. This will directly hurt Rhode Islanders who depend on RIPTA to get to jobs, school, medical appointments, or recreation. And it will hurt the environment, because expanding public transit is a major way to reduce carbon emissions and air pollution.

I was the sole Study Commission member to oppose the four recommendations. I explained that there is no reason to wait until after the COA is done to recommend new, sustainable funding for RIPTA, because the COA will not provide any relevant, new information. We know why RIPTA experiences perennial budget shortfalls; it is due to two major factors:

• Declining yield on the gas tax, which is RIPTA’s largest single source of revenue; this yield declined 12.9% in just four recent years; and

• Rising diesel prices for RIPTA busses. Diesel fuel is RIPTA’s second largest expense (after personnel); and diesel prices have increased 100% since 2005.

The fact is that the COA will not add any new, relevant information about these critical issues.

We also know the options for new funding; again, the COA will not add any new, relevant information there, either. At the June 1 meeting, I suggested that the Commission endorse the O’Grady Bill, H-7581, as an alternative to the four pre-written recommendations.

Each of the four proposed recommendations was moved separately and voted on separately. All four of the proposed recommendations passed by votes of 9 in favor, one opposed. I was the sole dissenter in each case. After I had lost on all four proposals, I made a proposal for a fifth recommendation.

I proposed that the Study Commission re-convene in September, rather than in March/April, as it has in the past, in order to be ready earlier in the next General Assembly session with new funding recommendations for RIPTA. In effect, my proposal was a challenge to the Study Commission. I was saying: If you insist on waiting until after the COA to recommend more funding for RIPTA (despite my objection to the delay), then, at least, move quickly after the summer and be ready with recommendations early in the next legislative session. My proposal was approved unanimously.

All in all, this was a disappointing end to this year’s meetings of the Senate Study Commission on Sustainable Transportation Funding.

However, CLF will remain engaged on the transportation front. Here in Rhode Island, the transportation sector is both the largest source of carbon emissions and the fastest growing – so we must address transportation if we are to address climate change. When the Study Commission re-convenes after the summer we shall re-double our efforts to have the General Assembly revamp the broken and inadequate ways that RIPTA is funded.

This Sunday, an Op-ed of mine appeared in The Portsmouth Herald. Below find a copy of the original text. You can find a copy of the original story here.

The nation and New Hampshire are relying less and less on coal — our dirtiest, least efficient fuel — to meet our electric power needs. PSNH recently announced it is not operating its flagship coal plant, Merrimack Station in Bow; the plant will sit completely idle for six months of 2012. The two coal boilers at PSNH’s Schiller Station in Portsmouth will operate even less. Yet, PSNH customers continue to pay a premium to keep PSNH’s coal plants on life support, thanks to a regulatory system that protects PSNH’s interests over those of ratepayers.

Coal-fired power plants — expensive new facilities and decades-old dinosaurs like PSNH’s plants alike — can’t compete in today’s marketplace. Investors and customers are moving toward cleaner, cheaper alternatives, principally natural gas, but also renewables (especially wind) and high-tech ways of reducing energy use. Northeast Utilities — PSNH’s parent company — admits that this reality is not going away anytime soon.

Indeed, the trend is accelerating. In the first quarter of 2012, coal power accounted for only 36 percent of the nation’s total electric output — the smallest role for coal in a generation and down almost 9 percent from the first quarter of 2011. Regionally, a new milestone came in April, when the New England regional electric grid operator announced that, during the previous month, the entire New England coal fleet was uneconomic — meaning there was not a single hour when a coal plant was able to compete with other energy sources. Despite coal’s downward trajectory, PSNH made big bets that the market for coal-fired power will exist for years to come. Exhibit A: PSNH’s investment — over vigorous opposition from the Conservation Law Foundation, ratepayer advocates and others — in a $422 million life extension project for Merrimack Station. If PSNH gets its way, ratepayers will foot the whole bill, plus a 10 percent guaranteed profit for PSNH’s sole shareholder, Northeast Utilities.

Why has PSNH been so richly rewarded for bad economic decisions? Put simply, New Hampshire’s relic of a regulatory system still protects PSNH and its coal plants from the market. Remarkably, ratepayers continue to pay for upkeep and staffing at PSNH power plants, even when they sit idle, and also pay that same 10 percent profit on the book value of all PSNH assets. No other power plant owner in New England gets such special treatment. Yet PSNH continues to sidestep scrutiny.

Earlier this year, following a massive lobbying effort orchestrated by PSNH, the New Hampshire House voted to table a bill that would have forced a hard look at PSNH’s continued ownership of these obsolete power plants.

In the meantime, PSNH remains in an economic “death spiral” with few large business customers to cover its costs and its remaining customers — homeowners and small businesses — now paying as much as 50 percent more for power than customers of other utilities, which get their power from the competitive market. Under the status quo, PSNH will siphon more than a $100 million in above-market costs out of the New Hampshire economy this year.

For the environment, the climate, and the long-term public and fiscal health of the communities surrounding these plants, coal’s demise is encouraging news. The market is providing an unprecedented opportunity to relegate coal power to the history books for good. New Hampshire should seize it.

This summer, New Hampshire is bracing for news of the Northern Pass project’s future and its “new route.”

It’s now been nearly a year since the federal permitting process for the Northern Pass project was put on indefinite hold. North of Groveton, New Hampshire, the developer – Northern Pass Transmission LLC (NPT) – is still working behind tightly closed doors to string together a new section of the project route, where there are no existing transmission corridors, by paying landowners substantial sums for property – in many cases, well above market value.

Earlier this month, the chief operating officer of NPT’s parent company, Northeast Utilities, told investors:

Where we are right now is in procuring the last 40 miles of the right-of-way, and I can tell you we are making very, very strong progress in lining up the right of way. I think we’re on track for the middle of the year, approximately August timeframe to have the right-of-way secured and then to be prepared to file with the [U.S. Department of Energy] the route….

NPT’s apparent plan (assuming it really can overcome the considerable obstacles to a new route):

• Declare that it “heard the objections” to the original route (a posture it previewed last April when it agreed to look for new routes)
• Announce a new NPT-controlled route having the “support of property owners” (as it no longer has resort to eminent domain)
• Marginalize those with legitimate objections as “special interests” and
• Seek a speedy, narrow review of the proposal from federal and state regulators (after itself having put the permit process on hold for a year).

Not so fast. Before the news arrives (if it does), it’s worth remembering that whatever new lines the developer manages to draw on the map do nothing to change the project’s DNA or to demonstrate that the project will benefit New Hampshire. A brief review is in order:

Where are the benefits for New Hampshire?

Through  costly marketing efforts, NPT has been trying to sell New Hampshire on the tremendous economic and environmental benefits of Northern Pass. But the supposed benefits just don’t hold up to scrutiny:

• Reduced emissions from “clean power”?

In terms of greenhouse gas emissions, CLF’s report on the most recent science demonstrated that new hydropower projects to supply power for Northern Pass are much worse for the climate than NPT’s false advertising claims have led the region to believe and are not meaningfully better than natural gas power plants (the power NPT predicts that Northern Pass would replace) in the early years after reservoirs are developed. As a result, contrary to mistaken but widely disseminated assumptions, importing hydropower from Canada is not a short-term solution that will reduce New England’s or New Hampshire’s carbon emissions. Indeed, the current proposal would have the perverse effect of protecting – rather than hastening the transition away from – PSNH’s low-performing, high-emitting power plants, which are New Hampshire’s largest source of greenhouse gas emissions. (Despite marketing the project based on its “clean” source of the power, NPT also refuses to acknowledge the relevance or importance of the troubling damage to ecosystems and communities that large-scale hydropower causes in Canada.)

• Lower electric rates?

Those who would live with the new transmission lines, customers of NPT affiliate PSNH, are the least likely to benefit. Despite nearly two years of promises that PSNH would announce a plan to purchase Hydro-Québec hydropower for New Hampshire residents, there is still no agreement to do so. Any modest effects on the region’s wholesale electricity rates (which NPT’s consultant predicted based on outdated economic assumptions about energy costs) don’t translate into lower rates for PSNH customers (who instead are stuck paying the bill for PSNH’s inefficient and dirty power plants). In fact, if Northern Pass succeeds in lowering wholesale rates, it will likely worsen PSNH’s death spiral of increasing rates and fewer customers, leaving those residents and small businesses still getting power from PSNH with higher bills.

• Growing New Hampshire’s clean energy economy and jobs?

There is a substantial risk that Northern Pass would swamp the market for renewable energy projects in New England, especially if state laws are amended to qualify Hydro-Québec power as “renewable.” Furthermore, the project’s high voltage direct current technology means that its massive investment in transmission capacity will wholly bypass the potentially fertile ground for renewable energy development in northern New England. Whatever the short-term construction jobs required (and NPT’s estimates are disputed), the current Northern Pass proposal may diminish the prospects for New Hampshire’s clean energy economy, including needed permanent jobs in the renewable and energy efficiency sectors.

No regional plan addressing new imports

Québec continues to implement its ambitious plan to develop more wild Boreal rivers into a new generation of massive hydropower projects, which will increase its export capabilities. This January, Hydro-Québec commissioned the final turbine at its latest hydropower facility (Eastmain 1-A) and will commission other turbines (at Sarcelle) as part of the same overall project later this year. Construction at the $8 billion Romaine River hydropower project (the subject of the film Seeking the Current) has begun and is ongoing, with the first unit expected to come online in 2014. Northeast Utilities has affirmed that Northern Pass will tap the power from these new projects. Meanwhile, Northern Pass competitors are moving forward with new transmission projects in eastern New England and in New York, among others:

Northern Pass and competitor transmission projects (source: ISO-NE)

More than a year ago, CLF and others urged the Department of Energy to weigh the region’s energy needs and develop a strategic regional plan that would determine a well-informed role for new Canadian hydropower imports in the northeastern United States’ energy future – before moving forward with the permitting process for Northern Pass. NPT’s only response was that responsible planning – encompassing the other pending transmission projects and a full consideration of the reasonable alternatives – would unacceptably delay its project – a truly ironic claim given NPT’s own, unforced, ongoing delay. More incredibly, the Department of Energy has so far sided with NPT, without explaining why.

So as Québec builds more dams and NPT buys up land, our region has no plan of its own. With no framework to understand the nature and extent of the appropriate role for Canadian hydropower, it is difficult if not impossible to make a sound, well-informed decision on whether Northern Pass – or projects like it – should proceed.

Community and grassroots reaction throughout New Hampshire

Since Northern Pass was announced in 2010, the project has inspired a broad-based and spirited movement of people throughout New Hampshire to oppose the current proposal. Last spring, there were massive turnouts at the Department of Energy’s public hearings on the project, with literally thousands attending and providing written and verbal comments both questioning the merits of the current proposal and urging a thorough environmental review. And earlier this year, a coalition of citizens and organizations of many political stripes succeeded in persuading New Hampshire’s legislature to enact a bill preventing projects like Northern Pass from using eminent domain. In another effort, more than 1,500 donors contributed total of $850,000 to enable the Society for the Protection of New Hampshire Forests to preserve the treasured New Hampshire landscape surrounding the historic Balsams resort, including a parcel that NPT had sought to purchase as part of Northern Pass’s transmission corridor. To date, town meeting voters in 32 local communities have passed resolutions and ordinances against the current proposal. Critically, most of these communities are located along the NPT’s “preferred route” that follows PSNH ‘s existing transmission corridor, south of any “new route” that NPT may announce.

NPT’s refusal to consider routing and technological alternatives

At every turn, NPT has rejected calls for in-depth consideration of potential alternatives to its current proposal, including use of an existing high-voltage transmission corridor that extends from Canada, through Vermont and western New Hampshire, to Massachusetts; burying transmission lines in transportation corridors, as is proposed in the New York and eastern New England projects mentioned above; or adding capacity to that same New York project, consistent with that project’s original proposal (it has since been scaled back). Indeed, Northern Pass’s response to the public’s opposition to the project was to “withdraw support” for alternative routes and double down on its “preferred route.” While this stance may be in the economic interest of NPT and PSNH, it’s grossly at odds with a fair, well-informed permitting process that would vindicate the public’s interest in a solution with minimal environmental and community impacts.

If and when NPT comes back from its year of buying up North Country land and relaunches its effort to secure approval of the Northern Pass project, with the only change to the proposal consisting of a new line on the map north of Groveton, there should be no mistake: the fundamental flaws in the current proposal remain. Likewise, whatever NPT’s “preferred route,” CLF remains as committed as ever to securing a comprehensive and rigorous permitting process that identifies superior alternatives and a final outcome that moves us toward – and not away from – a clean energy future for New Hampshire and the region.

For more information about Northern Pass, sign-up for our monthly newsletter Northern Pass Wire, visit CLF’s Northern Pass Information Center (http://www.clf.org/northern-pass), and take a look at our prior Northern Pass posts on CLF Scoop.

Starting tonight, public hearings will be held around the state on the Cape Wind / NSTAR long-term power purchase agreement. These hearings provide a key opportunity for people to attend and voice their support for this critically important and long-overdue clean energy project.

Note that these hearings are not an opportunity for resurrecting a tired old debate regarding whether or not Cape Wind should be built. State and federal authorities – as well as the strong majority of people of Massachusetts – have answered that question with a resounding YES after over a decade of review. The focus here is on the long-term Power Purchase Agreements signed between Cape Wind and NSTAR.

Hearings will be held at the following locations at the following times:

Natick, Massachusetts
Tuesday, May 22, 2012 at 7:00 p.m.
Natick Town Hall
13 East Central Street
Edward H. Dlott Meeting Room
Natick, Massachusetts 01760

Barnstable, Massachusetts
Wednesday, May 23, 2012 at 7:00 p.m.
Barnstable High School, Knight Auditorium
744 West Main Street
Hyannis, Massachusetts 02601

Boston, Massachusetts
Wednesday, May 30, 2012 at 7:00 p.m.
Department of Public Utilities
One South Station, 5th Floor
Boston, Massachusetts 02110

Recent polls confirm that the people of New England overwhelmingly recognize the need to address the threat of climate change and are willing to pay more for clean energy. With Massachusetts electric bills at a six-year low, the NSTAR/Cape Wind contract would only cost a small premium – about a dollar a month for the average residential customer.  And whenever fossil fuel prices increase again, as they always do, that premium will shrink to an even smaller amount – all while Cape Wind reduces our dependence on polluting and uneconomic fossil fuels like coal. So please join CLF and others in attending these hearings and voicing your support!

This week Rhode Island’s dominant utility, National Grid, made its first-ever filing with the Public Utilities Commission (PUC) under Rhode Island’s newly enacted “revenue decoupling” statute. Grid’s filing resolves once and for all a debate that has been swirling around the environmental community in Rhode Island (and the rest of New England) for years – an argument over whether decoupling is a rip-off of utility rate-payers. CLF (and other environmental advocates) have argued for years that there are important environmental benefits to be reaped from decoupling. Opponents, including some ratepayer advocates, argued that decoupling would be bad for rate-payers because it would inevitably lead to unjustified rate hikes.

In response to Grid’s filing with the PUC, the PUC opened a new docket (case) to consider decoupling.  CLF has filed papers to intervene in (participate in) this new PUC docket as a full party; you can see CLF’s Motion To Intervene here.

Grid’s highly technical, 51-page filing with the PUC this week is dense reading, with pages upon pages of complicated charts, but at the end of the day the filing resolves the controversy. Decoupling is good for ratepayers. And in just this first year of operation, Rhode Island electricity ratepayers will receive a collective refund from National Grid of over a million dollars.

Some explanation of what decoupling is and how this controversy has developed is in order.

Traditional utility regulation provides little incentive for utilities to promote energy efficiency. This is because reduction in sales equals a reduction in profits for the utility.

Decoupling is a way to address this problem and to align the utility’s pecuniary interest with the public interest in efficiency and conservation. Decoupling separates (that is, “decouples”) a utility’s income from the amount of commodity the utility sells. This effectively removes a major disincentive to utility enthusiasm for and participation in energy efficiency measures.

Decoupling is not all that is needed to achieve carbon-emission reductions through energy efficiency; but decoupling is one important and necessary ingredient. Many states have decoupled, and there is a high correlation between states that reduce carbon emissions the most (thereby lowering ratepayer bills the most) and states that have decoupled.

Work on “decoupling” is one aspect of CLF’s wider work on reducing carbon emissions in order to address the climate change emergency. More specifically, decoupling is closely linked to our work on energy efficiency. One of the most effective ways to reduce carbon emissions in the short- and medium-term is to work on energy efficiency.

In 2008, CLF participated in a litigation in the PUC in which we tried to get the PUC to decouple gas prices. The litigation, PUC Docket 3943, took weeks, and CLF presented an expert witness, crossed examined witnesses of other parties, submitted briefs. But CLF lost the case; the PUC ruled that it would not decouple gas prices in Rhode Island.

In 2009, CLF tried again, this time trying to get the PUC to decouple electricity prices. This litigation, PUC Docket 4065, also took weeks – again, we presented an expert witness, cross-examined other parties’ witnesses, briefed the issue. Again we lost; the PUC ruled that it would not decouple electricity prices.

The main argument against decoupling was that it would hurt ratepayers. The Division of Public Utilities and Carriers (this is the statutory ratepayer advocate in Rhode Island, and is different than the PUC) opposed decoupling for this reason, as did others. One expert witness against decoupling put it this way: “[T]he plan would allow a broad range of automatic rate adjustments that would result in rate increases . . . .There is no down side to the Company. The only down side is to the ratepayers.”

In response, CLF introduced evidence that actually came from 28 natural gas utilities and 12 electric utilities in 17 states across the country that have operative decoupling mechanisms. This broad range of utilities showed two important results from decoupling. First, decoupling adjustments tend to be small, even miniscule. Compared to total residential retail rates, decoupling adjustments have been most often under two percent, positive or negative, with the majority under 1 percent. Second, decoupling adjustments go both ways, sometimes providing small refunds to customers, sometimes providing small surcharges.

Nevertheless, despite the evidence we introduced, we lost both cases. The PUC was persuaded that decoupling was just a trick whereby the utility could always ratchet rates upward.

In 2010, CLF, working with other environmental organizations supported a bill in the Rhode Island General Assembly that would require decoupling of both electricity and gas prices. On May 20, 2010, Governor Donald Carcieri signed the bill into law.

On October 18, 2010, the PUC opened a new docket in order to implement the new law that mandated decoupling. This time, the question wasn’t whether Rhode Island would decouple, but how. CLF participated as a full party in the docket in order to ensure that the decoupling mechanisms adopted would be designed to reap all the environmental benefits without unduly hurting or harming ratepayers. Nine months later, on July 26, 2011, the PUC approved an excellent set of decoupling rules for both electricity and gas.

And this week, Grid filed its first report under the new Rhode Island decoupling statute and under the PUC rules. It shows that, on the electricity side, Grid is going to rebate to Rhode Island ratepayers just over a million dollars for the year just ending.

Remember the two points that CLF’s expert witnesses made in the decoupling dockets that we lost in 2008 and 2009.

• First, decoupling adjustments tend to be very small, even miniscule.

• Second, decoupling adjustments go both ways. Sometimes ratepayers pay a little extra; sometimes ratepayers get a rebate.

Grid’s filing this week in the PUC shows that CLF was correct on both points. This time, ratepayers are getting a rebate. And, yes, the amount is small. For the average (500 kilowatt-hour per month) electricity customer, the rebate will be 7¢ per month, or 84¢ per year. (And, yes, the adjustments can go both ways, and next year there might be a miniscule surcharge.) Meanwhile, everyone in Rhode Island enjoys the savings and efficiency benefits that decoupling enables – and the environment enjoys lower carbon emissions.

I think there may be two lessons that can be learned from this – one about CLF and one about the broader environmental movement.

About CLF: One of the things I love about working for CLF is the stick-to-itiveness that the organization (and my fellow and sister staff members) have. In 2008, we litigated decoupling, and we lost. So we tried again. When we lost again, we turned to a different forum, the General Assembly. When the law we supported passed, we were pleased – but we didn’t rest. We still had another litigation in the PUC to make sure that the law was properly implemented.

CLF is nothing if not persistent!

And about the broader environmental movement: So often our opponents argue that environmental protections are too costly to implement. Too often, the arguments made by environmentalists about the benefits and savings from environmental protections are just not believed by decision-makers and by ordinary citizens. With decoupling, everyone (including the PUC and so many others) just “knew” that decoupling would be an expensive rip-off. When evidence like this comes to light about the financial and pecuniary benefits of environmental laws, we should make sure that the public knows.

A fairly accurate critique of climate advocates and global warming advocacy can be that we can be a bit depressing.  This is not surprising when we are telling a story about how current trends will lead to large portions of the world becoming uninhabitable and sea levels rising to swallow many of our coastal cities and every day another study comes out that shows even the unenforceable and aspirational pledges by our governments will not be met and we face “potentially disastrous consequences.”

But an different and reoccurring theme in work around climate is interesting interaction with “adult” beverages like wine, beer and other alcoholic beverages – and not just because it is tempting to give up and just spend the day drinking (perhaps at a Green Drinks event for environmentalists).

There is the story of a leading climate scientist who is also a wine expert – and therefore the leading voice on the impact of global warming on the production of wine – a very serious matter when you consider that changing climate will undermine the ability of centuries old vineyards to thrive. Similar concerns bedevil the world of beer, where a changing climate endangers the production of the hops that are the heart of quality beer.

But spirits may also be part of the vast bank of solutions that we will need to make the fundamental shift in our economy and society that will be needed to stop our runaway greenhouse gas emissions.  Advanced biofuels, like high energy biobutanol, may well prove to be one of the many tools we will need to power a thriving post-carbon economy and entrepreneurs and researchers in Britain are working on converting distillery waste into that fuel – creating the possibility that brown liquor could helps us to go green and save ourselves from the consequences of global warming like the sea level rise that threatens our beaches and coastal communities.

We are in the midst of a massive, historic retreat in the nation’s use of coal to produce electricity, which began in 2008. This ongoing shift away from our dirtiest fuel has made news around the country. The primary reason: coal-fired power plants – expensive new facilities and decades-old dinosaurs alike – can’t compete in today’s marketplace. Investors and customers are moving toward cleaner, cheaper alternatives, principally natural gas but also renewables (especially wind) and high-tech ways of reducing energy use.

The national trend is occurring here in New Hampshire and throughout New England. This week, New Hampshire learned that PSNH is not operating its flagship coal plant, Merrimack Station in Bow, and that its economic prospects are not good. In fact, the plant will sit completely idle for six months of 2012, prompting the Manchester Union Leader to run the headline, “PSNH’s Bow power plant shuts down.” (The word “temporarily” was later added to the online story.) The two coal boilers at PSNH’s Schiller Station in Portsmouth will operate even less. (The Nashua Telegraph also took note.) This is welcome and long overdue relief for New Hampshire from New England’s top toxic polluter, and it would not have happened without legal pressure from CLF and others. More on our work in a moment.

Across the region, coal use has been collapsing for some time — and this was not unpredicted, as PSNH is claiming. PSNH’s claims to the contrary convey its willfully myopic planning perspective – a direct result of its expectation that ratepayers will cover its costs with a handsome profit irrespective of how utterly unsuccessful its investment decisions have been.

Coal-fired power plants’ “capacity factors” – their actual power output as a percentage of their theoretical maximum output at full power, running 24/7 – are intended to be very high; these plants were designed to run at close to full power day and night as “baseload” power for the electric grid. Not anymore:

In 2012, the trend is accelerating. Nationally, the U.S. Energy Information Administration reports that, in the first quarter, coal power accounted for only 36% of total generation – the smallest role for coal in a generation and down almost 9% from the first quarter of 2011. Regionally, a new milestone came in April, when the regional electric grid announced that, during the previous month, it didn’t dispatch any power from New England coal plants to meet the region’s electric demand.

For public health, air quality, the environment, the climate, and the communities where these plants are located, these trend lines are all in the right direction. For years, CLF’s Coal-Free New England 2020 campaign has fought to speed this progress and to make it permanent, by holding plant operators accountable for violating environmental laws (including at Merrimack Station), securing final and binding agreements to guarantee closure, and working in coalition with local residents to plan for responsible redevelopment and reuse of the plants’ sites.

In New Hampshire, with the complicity of state regulators, PSNH made big bets that the market for its coal-fired power will exist for years to come. One such spectacularly bad gamble was PSNH’s investment – over vigorous opposition from CLF, ratepayer advocates, and others – in a life extension project for Merrimack Station, including air pollution controls that address only some of the plant’s toxic and harmful emissions, to the tune of $422 million, plus a 10% guaranteed profit, money it now wants back from New Hampshire residents and small businesses through the regulator-approved rates it charges. Given coal’s collapse, which CLF and ratepayer advocates predicted at the time, this investment looks absurd and unwise, except of course to PSNH and its parent company Northeast Utilities, which has repeatedly reassured shareholders it is entitled to get back the full value of the upgrade, even if the plant barely runs.

Why has PSNH been so richly rewarded for such terrible economic decisions? Put simply, New Hampshire’s backward relic of a regulatory system is still protecting PSNH and its coal plants from the market. Remarkably, ratepayers continue to pay for upkeep and staffing at PSNH’s power plants, even when they sit idle, and also pay that same 10% profit on the value of all PSNH assets, including its quiet coal piles – and that’s whatever book value PSNH assigns, not market value.

PSNH has fought tooth and nail to protect its special treatment. Earlier this year, PSNH pulled out all the stops to kill a bill that would have directed state regulators to investigate whether PSNH’s ownership of power plants, including Merrimack and Schiller Stations, is in the best interest of ratepayers. After PSNH’s full-court press of lobbying, editorial board visits, and pressure from PSNH employees as well as PSNH-allied unions, politicians, and chambers of commerce, the House tabled the bill.

In the meantime, PSNH remains in an economic “death spiral” with very few large business customers to cover its costs. As a result, its remaining customers – homeowners and small businesses – are now paying as much as 50% more for power (8.75 cents per kilowatt-hour) than are customers of other utilities – which do not own power plants and get all their power from the competitive market (around 6 cents per kilowatt-hour). And the Legislature continues to seek the rollback of New Hampshire clean energy laws under the guise of easing ratepayer burdens, mistaking small trees for the forest of PSNH’s above-market rates, which include the costs of both PSNH’s idle fleet and buying power from more efficient plants.

What is CLF doing about it? Against the odds, we’re succeeding at forcing New Hampshire regulators to scrutinize PSNH’s costs, and the fact that PSNH’s coal plants are now sitting idle and the corresponding benefits to public health and the climate are a product of that scrutiny and a testament to CLF’s advocacy. And we’re pushing for regulators to do much more to hold PSNH accountable for its abysmal planning and force PSNH’s shareholder Northeast Utilities – and not suffering PSNH ratepayers, who are paying among the nation’s highest electric rates – to bear the downside of PSNH’s bad bets on coal. The last thing we should be doing with our energy dollars is subsidizing dirty power that can’t compete.

The market is providing an unprecedented opportunity to make that Union Leader headline from this week – and headlines like it for every other coal plant in the region – an enduring reality as New England transitions to a clean energy future. New Hampshire and the rest of New England should seize it.

A dispatch from the future? Manchester Union Leader headline, May 8, 2012