(photo credit: flickr/massdistraction)

We appreciate Northern Pass spokesman Martin Murray’s comment on my prior post regarding recent research on the greenhouse gas emissions of hydropower and the implications for the Northern Pass project. We are also grateful for Hydro-Québec environment advisor Dr. Alain Tremblay’s comment, to which I responded here.

Although we welcome the feedback and dialogue, we are discouraged that Mr. Murray’s comment addresses none of the substantive points raised by the Synapse report (PDF) or my post discussing the report. We are disappointed as well that the comment dismisses the fundamental need identified by the Synapse report – an honest and credible accounting for the effect of new imports on overall greenhouse gas emissions. Instead of working on providing such an accounting and engaging in a real dialogue about this issue, Northern Pass Transmission LLC (NPT) has invested heavily in advertising for the Northern Pass project, including the promotion of an emissions reductions figure reliant on new reservoirs that is based on an erroneous zero-emissions assumption. That assumption is contradicted by the Synapse report and Hydro-Québec’s own research, and the marketing claims on this issue (see, for example, here) are thus false and misleading and should be withdrawn immediately, as we have requested in a separate communication to NPT.

The citation to the Climate Action Plan sidesteps the merits of the emissions reduction issue entirely:

• First, the Task Force did not have the information in the Synapse report at its disposal in making its recommendations.
• Second, the Climate Action Plan contains important qualifications on its import recommendation that NPT does not acknowledge.  The recommendation itself contains the proviso that new imports should be pursued “with consideration for the broader environmental impacts of the power sources as well as the impacts that this imported power would have on the development of in‐state renewable resources.” That consideration is the work CLF believe needs to happen but has not.  In this regard, NPT’s dismissal of all questions or “challenges” on these issues is flatly inconsistent with the Climate Action Plan’s recommendation.
• Third, the Climate Action Plan appendix discussing the recommendation (PDF) states that “[t]he benefits to electric customers would be determined by the specific terms of any purchased power agreement and  the reductions to New England fossil fuel generation which would be subject to state regulatory  review and confirmation at the time of any filings for state approval.” (p. 29) In other words, the economic and environmental benefits from imports depend on the details of the proposal, specifically the terms and what generation is displaced. Yet the current proposal includes no Power Purchase Agreement that would benefit PSNH’s own energy consumers, assumes that any future power purchase agreement will be for only a small amount of power, and provides no guarantee or commitment that the imported power will reduce emissions in a meaningful way. The Synapse report directly refutes the only analysis of emissions reductions that NPT has made publicly available. The Climate Action Plan underscores the fundamental need for imports to provide real environmental and economic benefits for New Hampshire, and the current proposal on the table does virtually nothing to meet that need.
• Fourth, unlike all other recommendations in the Plan, enabling importation of Canadian hydro received a number of “no” votes from the Task Force, “due to concerns over the potential environmental impacts of the imported power and the effect imported power might have on development of in-state renewable resources.” Public comments  from a number of stakeholders, including CLF, questioned the entire recommendation based on these concerns. (Comments are summarized at pp. 246-258 of this PDF.) There was a debate then, and that debate should continue now, based on well-sourced and credible information like the Synapse report.

We agree that there is no one single solution to the climate challenge. But any serious effort to confront climate change in New Hampshire must also confront the largest source of greenhouse gas emissions in the state – PSNH’s aging, inefficient, and uneconomic fossil fuel power plants. As Dr. Tremblay of Hydro-Québec admitted, in comments that NPT is now approvingly citing, “the major environmental challenge facing North America is to replace coal to generate power….” CLF couldn’t agree more.

It seems NPT and its affiliates do not agree with Dr. Tremblay. Importing an additional 1,200 megawatts of hydropower from Canada will not help move New England toward a clean energy future if, as the current proposal is structured and as PSNH has repeatedly claimed, imports would only displace relatively clean natural gas generation, and not the power plants that are worst for the climate, like PSNH’s coal-fired units at Merrimack and Schiller Stations.

With Northern Pass proponent PSNH fighting tooth and nail to protect its guaranteed ratepayer subsidy to keep running those units, the supposed commitment of Northern Pass’s developers to reducing greenhouse gas emissions appears to be a textbook example of a greenwash. Given the emissions data presented in the Synapse report, it is clear to CLF that, if Northern Pass proceeds as proposed, our region will forfeit a major opportunity for meaningful action to confront climate change.

Hydro-Québec hydroelectric projects recently commissioned or under construction (Source: Quebec Ministry of Natural Resources and Wildlife)

Reducing the region’s emissions of greenhouse gases is supposedly the Northern Pass project’s marquee public benefit, its raison d’être as they say in Québec. But would the Northern Pass project do the job?

The answer appears to be: probably not any time soon. Today, CLF is releasing a ground-breaking new technical report regarding the greenhouse gas emissions of Canadian hydropower. The conclusions of the report show that large-scale hydropower, especially new reservoirs, is worse for the climate than Northern Pass’s developers are claiming, with substantial greenhouse gas emissions that are comparable to those of modern natural gas-fired power plants. The current Northern Pass proposal substitutes hydropower for natural gas in New England’s energy mix, meaning that the project won’t reduce emissions by much if any, especially in the near term.

Authored by Synapse Energy Economics, the technical report released today, Hydropower Greenhouse Gas Emissions: State of the Research, is an independent survey of the recent science regarding the greenhouse gas emissions of hydropower. The science is clear that the reservoirs behind hydropower dams emit greenhouse gases, relative to the forests and wetlands they flood (which often take greenhouse gases out of the atmosphere). Overall, reservoirs in Québec emit more greenhouse gases over the course of their lives than renewables like wind, solar, and run of river hydropower.

A crucial finding of the report concerns new reservoirs. In the first several years after a reservoir is dammed, large amounts of newly inundated organic material decompose, emitting carbon dioxide that diffuses through the water into the atmosphere. As a result, a reservoir’s net emissions in its early years are very high – starting out even higher than emissions from a natural gas power plant per unit of power generated. This effect is evident in recent, rigorous analyses by several teams of scientists, based on data collected at Hydro-Québec’s Eastmain 1 reservoir in northern Québec. This reservoir is the very same project that Northeast Utilities’ CFO testified under oath last year would be the primary, if not exclusive, source of Northern Pass’s power. Even when their emissions are projected over their lifetimes, newly flooded Canadian reservoirs may emit nearly two-thirds of the greenhouse gases emitted by natural gas power plants. By contrast, reservoirs emit only about 20% of the greenhouse gases emitted by typical coal-fired power plants.

This conclusion is the death knell for Northern Pass Transmission, LLC’s (NPT) claim that the current Northern Pass proposal would reduce greenhouse gas emissions by up to 5 million tons. We explained the claim’s key flaw – the report on which it is based erroneously assumes that hydropower has no greenhouse gas emissions – back in August. In light of today’s report, CLF is calling on NPT and its partners NU, NSTAR, and PSNH to stop citing that erroneous number and to withdraw all marketing materials for the Northern Pass project that state or imply that Canadian hydropower has no or minimal greenhouse gas emissions. Hydro-Québec is building new hydropower projects that are intended to facilitate new exports to the northeastern United States. To the extent that the prospect of exports is driving the construction of new reservoirs, Northern Pass and projects like it will be responsible for those reservoirs’ emissions and also their other adverse environmental impacts. And if, as the developers’ analysis concluded, the power to be displaced by imports through Northern Pass is overwhelmingly from natural gas plants, the emissions from a succession of new reservoirs in Canada may replace – perhaps completely for a period of time – the emissions of displaced natural gas power. In that scenario, the Northern Pass project would do little – or even nothing – to reduce greenhouse gas emissions, at least in the near-term.

The report makes another critical point about a different kind of displacement that could occur with Northern Pass. According to a recent study, stepping up Hydro-Québec’s exports to the United States may actually decrease its exports to other provinces in Canada, where the need for fossil fuel-fired power then increases, resulting in additional emissions. Those emissions may cancel out any reductions from displaced power in the United States. This effect is a potential blind spot that needs to be considered and analyzed as part of the public review of any new imports.

The report’s findings are important information regarding the environmental impacts of the project that the U.S. Department of Energy must consider as part of its review of Northern Pass’s application for a Presidential Permit. For that reason, earlier today, CLF submitted the report to DOE along with Synapse’s analysis of the potential effect of Northern Pass on the regional market for renewable energy.

To CLF, the report suggests that new imports could be part of the region’s climate strategy if imports:

• displace dirty power, like project sponsor PSNH’s uneconomic, subsidized power plants, to achieve a meaningful net reduction in greenhouse gas emissions without increasing the use of fossil fuel-fired power plants in Canada;
• support – rather than undermine – local renewable projects and energy efficiency efforts in New England; and
• have minimal impacts on the environment and communities on both sides of the border.

PSNH is in a unique position to take its coal units offline, in conjunction with its potential power purchase agreement with Hydro-Québec that is supposedly in the works. Instead, PSNH is marching on with its broken coal-based business model at great cost to New Hampshire consumers and the environment. Unless the proposal changes, the Northern Pass project does not deliver on the developers’ claims and will not advance a cleaner energy future for New England.

Outlook with your head in the sand? Pretty dark, even when the future around you is bright. (photo credit: flickr/tropical.pete)

In a public hearing tomorrow, a legislative committee of the New Hampshire House will take up a proposal – House Bill 1238 – to force Public Service of New Hampshire’s dirty, costly power plants to confront the realities of the electric marketplace. The bill would require PSNH to sell (“divest”) its plants by the end of next year. Tomorrow’s hearing on House Bill 1238 is scheduled for 8:30 am in Representatives Hall under the dome of the New Hampshire State House, on North Main Street in Concord.

The debate is long overdue and comes at a critical time. Over the last several years, New England’s restructured electric market has overwhelmingly turned away from uneconomic facilities like PSNH’s coal and oil-fired power plants and toward less-polluting alternatives, especially natural gas. For most New England customers, this technology transition has resulted in lower electric bills, and we have all benefited from cleaner air. In the next few years, well-managed competitive markets are positioned to help us move to a real clean energy future that increases our use of energy efficiency, renewable resources, demand response, and innovative storage technologies.

CLF has played a key role in this process by, among other things, ensuring that coal plants are held accountable for their disastrous impacts on public health and the environment. As highlighted in an excellent op-ed in the Concord Monitor this week, CLF’s work includes our federal court case against PSNH’s Merrimack Station, New Hampshire’s biggest source of toxic and greenhouse gas emissions, which has repeatedly violated the Clean Air Act by failing to get permits for major changes to the plant.

Meanwhile, like the proverbial ostrich, PSNH gets to ignore what the market is saying. PSNH’s state-protected business model is a relic that has become a major drag on the pocketbooks of New Hampshire ratepayers and New Hampshire’s economy. Current law protects PSNH from market forces because it guarantees PSNH and its Connecticut-based corporate parent Northeast Utilities a profit on investments in PSNH’s power plants, whether or not they operate and whether or not they actually make enough money to cover their operating costs – an astounding rule for the small-government Granite State, to be sure.

The costs of this guarantee fall on the backs of New Hampshire residents and small business people, who effectively have no choice but to pay for PSNH’s expensive power. For their part, larger businesses have fled PSNH in droves, for cheaper, better managed suppliers. This has shrunk the group of ratepayers who are responsible for the burden of PSNH’s high costs, translating into even higher rates for residents and small businesses.

PSNH customers face the worst of both worlds – electric rates that are among the highest in the nation and a fleet of aging, inefficient, and dirty power plants that would never survive in the competitive market.

It is by now beyond dispute that these plants are abysmal performers. Last year, CLF and Synapse Energy Economics presented an analysis to New Hampshire regulators showing that the coal-fired units at PSNH’s Schiller Station in Portsmouth will lose at least $10 million per year over the next ten years, for a total negative cash flow of $147 million. The analysis did not depend on natural gas prices remaining as low as they are now or any new environmental costs; because it is old and inefficient, Schiller will lose money even if gas prices go up and it doesn’t need any upgrades. According to information provided by PSNH to regulators last week, PSNH’s supposed workhorse Merrimack Station will not even operate for five months this year because it would be uneconomic compared to power available in the New England market. Nonetheless, PSNH ratepayers will be paying for the plant even when it does not run.

It will only get worse: PSNH’s rates could skyrocket later this year if New Hampshire regulators pass on the bill for PSNH’s $422 million investment in a scrubber for Merrimack Station to ratepayers, and other costly upgrades of PSNH’s fleet may be necessary to comply with environmental and operational requirements in the future. And the PSNH-favored Northern Pass project, if it ever gets built, would only exacerbate the situation for PSNH ratepayers by making PSNH power even less competitive and reducing the value of PSNH power plants.

PSNH is hitting back against House Bill 1238 with its typical full-court press of lobbying and PR, and we can expect a packed house of PSNH apologists at tomorrow’s hearing. PSNH has even resorted to starting a Facebook page – “Save PSNH Plants” – where you can see PSNH’s tired arguments for preserving the current system plants as a “safety net” that protects PSNH employee jobs and a hedge against unforeseen changes in the energy market. The pitch is a little like saying that we should pay Ford and its workers to make Edsels half a century later, just in case the price of Prius batteries goes through the roof. Make no mistake: PSNH is asking for the continuation of what amounts to a massive ratepayer subsidy for as far as the eye can see.

Public investments have gotten a bad name lately, but it is at least clear that sound commitments of public dollars to energy should be targeted, strategic, and forward-thinking. They should help move us, in concert with the much larger capital decisions of the private sector, toward a cleaner energy future. Instead, PSNH is fighting for New Hampshire to keep pouring its citizens’ hard-earned money, year after year, into dinosaur power plants. That’s a terrible deal for New Hampshire, and CLF welcomes the House’s effort to open a discussion on how to get us out of it.

The nation’s attention may be focused right now on the twists and turns of New Hampshire’s First in the Nation primary. But new pollution data from the Environmental Protection Agency put a more troubling spotlight on New Hampshire – and on its largest utility, Public Service Company of New Hampshire (PSNH). 

According to the data, PSNH is the region’s top toxic polluter, and PSNH’s coal-fired power plant in Bow, Merrimack Station, releases more toxic pollution to the environment than any other facility in New England. Because of PSNH, New Hampshire as a whole is first in New England in toxic pollution.

The numbers tell a striking story.  In 2010, Merrimack Station released 2.8 million pounds of toxic chemicals to the environment, mostly in air pollution.  That’s an astonishing 85% of the 3.3 million total pounds of toxic pollution released in New Hampshire in 2010. When you add in PSNH’s coal-fired Schiller Station in Portsmouth and its gas and oil-fired Newington Station in Newington, PSNH was responsible for a total of 3 million pounds of toxic pollution in 2010, more than 90% of New Hampshire’s toxic pollution. 

PSNH’s pollution isn’t saving energy consumers anything – PSNH’s rates are among the highest in New England because of the escalating costs of maintaining PSNH’s old, inefficient power plants. And those rates are slated to steadily climb as PSNH customers – mostly residents and small businesses – watch large commercial and industrial customers reject the costs of PSNH’s above-market coal-fired power to buy from cost-effective, competitive suppliers. As a result, most New Hampshire residents are left with the raw deal of paying among the highest rates for the dirtiest power in New England.

The data is a fresh reminder of why CLF is fighting so hard to hold Merrimack Station accountable for violating the Clean Air Act. In November, CLF made the case in federal court that PSNH’s failure to obtain permits for changes at Merrimack Station has meant that PSNH has evaded requirements for state-of-the-art pollution limits that would reduce its emissions of a wide range of toxic and other pollutants.

It’s true that PSNH’s much-touted and hugely expensive scrubber project now coming online at Merrimack Station will ultimately reduce some types of toxic pollution to the air. But PSNH wants to increase its energy rates by 15% to pay for the scrubber. Other required pollution controls, including those imposed by important new federal rules, may lead to further costs. This will make PSNH’s power plants an even worse deal for New Hampshire ratepayers.

Merrimack Station also sends more carbon dioxide into the air than any other source in New Hampshire, and the scrubber won’t change that. Burning coal is a dirty way to generate power that imperils the climate, and it is time for New England to abandon it for cleaner alternatives that safeguard our health and environment and transition us toward a new energy system.

New Hampshire may never be willing to relinquish its leading spot on the presidential primary calendar. But living with New England’s largest source of toxic pollution despite its unacceptable costs – to ratepayers and the environment – is a distinction that New Hampshire should be doing everything in its power to lose.

courtesy Society for Protection of New Hampshire Forests

Last week brought a fitting capstone to the botched year-long rollout of the Northern Pass project.  In a disturbing turn of events, the project developers sought to scuttle a historic plan to preserve a storied wilderness in New Hampshire’s North Country. Their attempt failed, but what the episode says about their future tactics is anything but encouraging for New Hampshire and the region.

Northern Pass Transmission, LLC (NPT) – a partnership between Northeast Utilities and NSTAR – has spent 2011:

• misrepresenting the Northern Pass project’s environmental benefits,
• misleading the public about potential savings to New Hampshire electric ratepayers,
• withdrawing and refusing to analyze alternatives (including options that would avoid overhead lines through the White Mountain National Forest),
• blocking a full assessment of the nature and extent of the region’s need for more electricity imports from Canada, and
• trying to buy off landowners along the northernmost 40 miles of the project.

It has been clear for some time that the current proposal is really about two things – securing profits for Hydro-Québec and propping up NU subsidiary PSNH’s weakening bottom line. CLF is not alone in wondering: what’s in it for New Hampshire?

Last week was a vivid preview. And if you care about New Hampshire’s iconic wilderness landscapes or the organizations that protect them, it’s not a pretty picture.

Earlier this fall, we learned that NPT was bidding to purchase a strip of land through one of the North Country’s crown jewels – the magnificent Balsams estate in Dixville Notch – from its owner, the Neil Tillotson Trust.

Enter the Society for the Protection of New Hampshire Forests (SPNHF), a key collaborator with CLF on Northern Pass advocacy and one of the state’s leading land conservation organizations. Culminating a decade of effort to preserve the Balsams landscape, SPNHF secured from the Trust a conservation easement over 5,800 acres of spectacular wilderness surrounding the resort, provided that SPNHF raises $850,000 for the easement by mid-January. (You can follow the effort here. Word is that, as of today, SPNHF is nearly a third of the way there.) The easement would preclude any transmission corridor.

The land is an ecological and scenic marvel, and the deal marks a historic land preservation achievement for SPNHF, the Trust, and New Hampshire as a whole.

The Balsams Resort in winter (photo credit: j-fi/flickr)

NPT’s bizarre and audacious response: launch a legal attack on the conservation plan.

Last week, NPT asked the state Attorney General’s Office to disapprove the easement on the ground that NPT’s earlier bid was higher. Then on Friday of last week, NPT made a very public offer to buy both the transmission corridor and the conservation easement, which would secure a right to site the Northern Pass project on the Balsams property. The last move was particularly odd because most bidding wars don’t involve publicly bullying a seller – a respected charitable trust no less – into accepting an offer.

As noted in the Concord Monitor and on NHPR, news came late Friday afternoon that the state Attorney General’s Office had approved the sale of the conservation easement to SPNHF, despite NPT’s objections and richer offers. The approval letter noted that it was well within the Trust’s charitable purposes and discretion to sell the easement to SPNHF for less than NPT’s offer. In other words, the Trust should be free to decide that preserving the Balsams property for the benefit of the North Country is more important than the Trust’s financial return.

Why was NPT’s attack on the conservation plan so troubling?

• NPT sought to undermine land preservation efforts throughout New Hampshire. Land preservation almost always requires generosity – the landowner’s decision to accept less than market value or to make an outright donation of an easement. If it had been successful, NPT’s legal attack would have left no room for such generosity, granting any private developer the power to block a landowning non-profit’s preservation of its land whenever the developer offered more money than the conservation organization or community that would hold the conservation easement.
• NPT is on war footing.  NPT is pursuing the equivalent of scorched earth litigation, resorting to strong-arm tactics and legal appeals to the state, including a threat of litigation to block the SPNHF easement that, as of today, remains on the table. At this early stage of the project’s permitting, this is exactly the opposite of what we need – a well-informed regional and statewide dialogue about our energy future, the project’s potential role if any, and the alternatives to traditional overhead lines along NPT’s proposed route.
• NPT has broken its promise to find a route “that has support of property owners.”  The Trust made a decision not to sell to NPT; within days, NPT was crying foul to a state official.  NPT’s appeal to the state reveals, for all to see, that NPT will respect the will of landowners only when that will is to sell NPT the land it wants. As others pointed out before the Attorney General Office’s decision, NPT’s carefully-worded disinterest in using eminent domain (except as a “very last resort,” in the words of PSNH President Gary Long) is no longer credible, if it ever was.
• NPT is willing to spend huge sums, but only to get the project it wants. Without hesitation or public discussion, NPT offered what amounts to a $1 million donation (of Hydro-Québec’s money) to the Trust, including a $200,000 grant to Colebrook Hospital and the money for the Balsams conservation easement. Clearly, NPT is willing to spend millions above and beyond market costs to get the route it wants, even as it rejects as too costly alternatives that could be better for New Hampshire.

Above all, the Balsams episode shows that NPT is not pursuing the Northern Pass proposal as a public-minded enterprise for the “good of all of New Hampshire.” With so much at stake for the region and New Hampshire, CLF’s work of 2012 is to secure a searching and rigorous public review process that will scrutinize every element of the Northern Pass project and ensure that the public interest – and not the dollars in NPT’s coffers – determines the project’s fate.

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/northernpass), and take a look at our prior Northern Pass posts on CLF Scoop.

Merrimack Station in Bow, NH

In more than 50 pages of filings last Thursday, CLF responded to a pair of motions by Public Service Company of New Hampshire (PSNH) asking for dismissal of our Clean Air Act citizen suit now pending in federal district court in New Hampshire. That same day, CLF’s lawsuit got a major boost when the U.S. Environmental Protection Agency (EPA) filed a brief of its own, as a friend of the court, to identify the legal errors in PSNH’s key argument.

One PSNH motion challenged CLF’s right to sue PSNH to protect the environmental and public health from Merrimack Station’s illegal pollution. The other motion claimed that PSNH didn’t do anything wrong when it renovated Merrimack Station because EPA regulations allow it to make changes without permits.

In our briefs, CLF vigorously objects to both motions. You can download our briefs in PDF format here and here; our full set of filings, including attachments, is here (7MB .zip file).

PSNH’s illegal projects will increase Merrimack Station’s emissions, which will harm the health and well-being of CLF members. Under federal law, this harm means that CLF has the right to sue PSNH to hold it accountable for violations of the Clean Air Act. Because PSNH failed to get permits for its projects, PSNH violated the law. Those permits would require PSNH to install more stringent and protective pollution controls that all new plants must include, reducing Merrimack Station’s emissions of a wide range of pollutants, beyond the reductions that Merrimack Station’s expensive new scrubber (which is limited to reducing sulfur dioxide and mercury emissions) can achieve.

Incredibly, PSNH’s argument that it is exempt from permitting requirements is entirely based on EPA regulations that do not apply in New Hampshire. It’s not a close call; PSNH’s brief arguing for our lawsuit to be dismissed gets the rules 100% wrong, an astonishing error for a sophisticated company like PSNH, New Hampshire’s biggest utility.

EPA’s filing puts the final nail in the coffin for PSNH’s flawed legal argument. In a 25-page brief, EPA shows how, even if the rules PSNH is citing were the right ones, PSNH got those rules wrong too. As the author of the regulations PSNH cites, EPA explains that those regulations also would require PSNH to obtain permits before undertaking projects that will increase emissions.

It could not be clearer that PSNH’s recent renovation strategy at Merrimack Station — “build first, see what happens later” — violates the Clean Air Act. CLF will continue its fight to hold PSNH accountable for its violations as this case proceeds in the months to come.

Today, the New Hampshire Department of Environmental Services provided an annual report to the New Hampshire legislature detailing the results of the Regional Greenhouse Gas Initiative (RGGI) Carbon Dioxide Emissions Budget Trading Program.  The report notes that the program has supported approximately $20 million in job creating energy efficiency investment in New Hampshire and that each dollar of invested RGGI revenue resulted in $3.42 in direct energy savings (See this study by the University of New Hampshire). The report concludes that the effect of the RGGI program on rates has been negligible, amounting to .06 cents per kWh, or approximately 30 cents per month per household.

At the same time, electricity bills for customers of New Hampshire electric utilities have decreased dramatically since RGGI went into effect, with the exception of PSNH customers.  According to the report, the average PSNH residential customer is currently paying approximately $27 per month more than a New Hampshire customer in National Grid’s service territory for the same amount of power ($89 per month for PSNH versus $62 per month for National Grid).

Given the magnitude of the excessive energy costs paid by PSNH residential customers (comprising the overwhelming majority of New Hampshire homes), one might assume that the legislature would use the report as a basis for reviewing and revising the state’s policy that forces New Hampshire residents to subsidize PSNH’s above market costs to the tune of $324  per ratepayer per year.

Instead, House Speaker William O’Brien and Majority Leader D.J. Bettencourt issued a statement today criticizing RGGI for laying an extra “$5.50 per year on the backs of our ratepayers.”  They appear to have missed the forest for the trees (and bungled their math).  New Hampshire ratepayers pay among the highest rates in the country because PSNH imposes on them the above-market cost of its dirty and expensive power.  In fact, the report shows that National Grid ratepayers in New Hampshire, having been spared the legislative mandates that inflict exorbitant costs on PSNH ratepayers, pay the lowest electric rates in New England. National Grid and other New Hampshire utilities purchase power from newer, more efficient power plants selling into the wholesale market.

Improving New Hampshire’s economic future requires a thoughtful review of the statutory policies that extend the lives of PSNH’s uneconomic power plants and foist the exorbitant costs of these plants, and the pollution they emit, on New Hampshire residents. Portraying a successful and economically beneficial program such as RGGI as a burden to ratepayers lays blame in the wrong place and amounts to a game of political charades—a disservice to New Hampshire voters and job creators.

Are you concerned about the Northern Pass transmission project? Do you want to learn more about what it could mean for New Hampshire and New England’s energy future, for our climate, for energy rates, and for the communities and natural environment of New England and Québec? Do you want to keep up with the latest developments as the project progresses through the permitting process?

If you answered yes to any of these questions, you’ll want to sign up for CLF’s new email newsletter – Northern Pass Wire.  In a concise format, Northern Pass Wire will provide the latest news and analysis regarding the Northern Pass project direct from CLF advocates, with links to additional resources from CLF’s Northern Pass Information Center, our latest Northern Pass posts here on CLF Scoop, and CLF’s recent legal filings. Northern Pass Wire will also keep you informed about ways you can get involved and make your voice heard as the permitting process for the Northern Pass project continues. We expect to publish Northern Pass Wire about once a month, and perhaps more frequently when events warrant. The first edition can be previewed here, and you can sign up to get Northern Pass Wire here.

Please sign up and encourage your family, friends, and colleagues to do the same!

Click on the image to preview the first edition of CLF's Northern Pass Wire

photo credit: l . e . o/flickr

With each passing day, the dire reality of PSNH’s coal-fired business model is becoming clearer in New Hampshire.  The cost of operating PSNH’s obsolete power plants continues to grow, accelerating the Company’s death spiral where fewer captive ratepayers are saddled with unsustainable above-market rates as more PSNH customers choose to buy power from better managed competitive suppliers.  We are also learning that Northern Pass will make the situation worse for ratepayers, not better, and that PSNH and its Northern Pass partners are poised to pull in huge profits.  In just the last few days:

• PSNH revealed that, as it has begun bringing online its $450 million scrubber project at PSNH’s 50 year old coal-fired Merrimack Station, the bill is now coming due. If state regulators at the New Hampshire Public Utilities Commission (PUC) approve passing the cost on to ratepayers, the energy rates for PSNH customers – already the highest in New Hampshire by a wide margin – will go up by at least 1.2 cents per kilowatt hour, or almost 15%.  CLF is seeking to intervene in the PUC proceeding on the rate increase.  PSNH, unsurprisingly, wants to keep CLF out, in addition to any other party seeking to intervene on behalf of ratepayers.  There is no better illustration of the folly – for ratepayers and the environment alike – of major new investments in coal-fired power plants than PSNH’s flawed effort to extend the life of Merrimack Station.  These investments are a disaster for ratepayers, and don’t even ensure compliance with the plant’s environmental requirements – a case CLF is making right now in federal court with regard to other modifications to Merrimack Station.
• Large commercial and industrial customers with the buying power to avoid the high rates for PSNH’s fossil power continue to do so in dramatic numbers.  PSNH announced that, in September, about 82% of these customers were buying power elsewhere in the market (accounting for 93% of the power delivered to these customers) – a phemonenon known as “migration.”  Meanwhile, more than 99% of New Hampshire residents in PSNH territory were left behind to pay PSNH’s already exorbitant rates.  The scrubber rate increase is going to make this situation even worse for residents – additional businesses will find other suppliers and PSNH will need to jack up its rates even more.  More cost-effective competitive suppliers are cleaning PSNH’s clock among large customers.  Given the company’s excessive and increasing rates, residential ratepayers are starting to vote with their pocketbooks for more sustainable energy supplies.
• It is becoming increasingly clear that the current Northern Pass proposal is designed around PSNH’s bottom line, not the interests of New Hampshire ratepayers.  As we’ve mentioned before, the large customer “migration” problem and its upward pressure on homeowners’ electric bills are likely to get worse with Northern Pass, which would further depress regional wholesale electric rates and encourage more customers to leave PSNH.   Adding in the cost of the scrubber will only widen the divide between the businesses that can choose other suppliers and potentially benefit from Northern Pass, and the residential customers who are currently  stuck with PSNH. A new wrinkle emerged last week – testimony from PUC staff showing that PSNH’s consultants estimated a year ago that Northern Pass will cannibalize PSNH’s already meager revenues from Newington Station, PSNH’s little-used power plant in Newington, New Hampshire, that can operate with either oil or natural gas.  Northern Pass would mean it would almost never run and that the investments ratepayers have made over the years to keep Newington Station operating will essentially be lost.  This same dynamic will apply to the rest of PSNH’s power plants:  Northern Pass will diminish their market value further exposing New Hampshire businesses and residents to the risk of excessive costs.  Once again, a series of poor decisions and self-interested advocacy by PSNH (at the expense of ratepayers) is forcing the legislature to intervene.

The costs of PSNH’s coal-fired power plants are becoming untenable, and a radically redesigned Northern Pass proposal and other alternatives could help PSNH meet its customers’ power needs more cheaply and with less damage to public health and the environment.  Instead of planning for a cleaner energy future, PSNH is working only to preserve its regulator-approved profits.  CLF will be using every tool at our disposal to force a rethinking of PSNH’s approach.