Gas pains

On July 20, the Public Utilities Commission will rule on CMP Natural Gas’ application to become a distributor of this fuel new to most of the state. Since part of the proposal by the Central Maine Power-led consortium will put it right in the middle of eastern Maine turf already staked out by Bangor-Hydro’s Bangor Gas, the question facing the PUC isn’t just one of who lays pipe where but of whether this fledgling utility will be based upon the old model of the regulated monopoly or one of competition.

There’s a lot to be said for competition. Two companies going head-to-head could result in better rates and better service. At the local level, municipalities would have more bargaining power to see that gas goes not just to the major industrial user, but also to the neighborhoods, to the small businesses, to the parts of town where growth is desired. Competition could be a town’s best assurance that gas distributors don’t just pick the ripest plums, that they don’t merely skim the richest cream.

By creating a competitive environment, the PUC can prevent that from happening at the local level and it can take further action to stop it at the state level. In fact, it can reverse a trend already developing.

The map of the proposed project is telling. The Maritimes & Northeast pipeline will enter Maine from New Brunswick at Baileyville. From there, the gas will traverse the entire width of Washington County before the first distribution laterals sprout off in the Bangor region. Thus, except for Baileyville and its Georgia-Pacific mill, the state’s poorest county, the county with chronic double-digit unemployment is, for now at least, only a conduit for natural gas and not a beneficiary.

The entire point of this gas project is economic development. Gas will provide an alternative, it will force all energy providers to be more competitive, it will protect consumers from fluctuations in oil supply and pricing. Its clean-burning properties are attractive to industry; already there are several power plants on the drawing board.

Perhaps Calais, which has long sought to develop light manufacturing, could use this fuel. So perhaps could aquaculturists in Eastport and Lubec, or blueberry processors in Machias and Jonesboro. Maybe some struggling town Downeast would welcome the jobs and tax base a low-emission power plant would generate. With oil prices at recent historic lows, the OPEC nations now are talking about curtailing production to drive them back up. As things stand, Washington County, the county that can least afford it, will bear the brunt.

The PUC can prevent this from happening. With CMP Natural Gas’s application on the table, with Bangor Gas re-applying to expand its penetration in the Bangor region, the state has the opportunity to deal, to swap entry into a lucrative market for solid guarantees that a needy market will be served.

And, according to Charlotte LeGates of the Natural Gas Supply Association, the Washington, D.C.-based national organization of gas producers and marketers, states engage in such horse-trading all the time.

“Of course the distributors will skim the cream if states allow it,” LeGates says. “That’s why states negotiate in the application process and that’s why in 48 states there are extensive gas-distribution systems, with small towns and rural areas served as well as the cities and industries. Maine is fortunate; you’re starting from scratch, you can build a competitive environment from the beginning and your PUC can do a great deal to see that the economic benefits of natural gas get spread out.”

In other states, natural gas has proven itself to be a safe fuel; the pipelines that carry it have not caused unacceptable environmental damage. Still, there is some risk and there is some disruption. Maine is giving something up in permitting these projects and the PUC has the opportunity to get something back.

Bringing a tool of economic development to a region desperately in need of economic fixing seems like a good place to start.