November 07, 2024
Editorial

FLICKING THE SWITCH

Trying to understand Maine’s place in the ISO-New England electricity grid, and to then consider how to improve the state’s position, is like trying to think 10 moves ahead in a game of chess. But legislators would do well to make the effort as they analyze a report by the Public Utilities Commission to be presented to them next month.

PUC Chairman Kurt Adams and his staff analyzed the state’s position with ISO-New England in light of three state policy goals: containing cost and stability of pricing; conforming to greenhouse gas standards; and working to have 10 percent of electricity provided by renewable sources by 2018. By those standards, the status quo is not fair to Maine consumers, Chairman Adams concluded.

Before deregulation in 2000, the PUC was the gatekeeper on rate increases. Now, the PUC buys power on the open market for consumers, but that market increasingly is unfavorable to buyers. Since 1990, electricity prices have increased nationwide by 35 percent; in Maine, the price is up 55 percent. Part of the high cost, Mr. Adams said, is tied to New England’s reliance on electricity generated by natural gas power plants – 40 percent of electricity production in New England, compared with 20 percent nationwide.

Natural gas burns cleaner than coal and oil, he hastens to point out, but New England is at the end of the supply line. Even though a gas pipeline from Sable Island in Nova Scotia passes through Maine, there is no storage capacity here.

During a weekend last month, an equipment failure at the Sable Island facility put two of Maine’s five gas-burning plants off line. The power loss was absorbed by facilities such as paper mills, whose contracts allow ISO-New England to cut them off. But such an outcome is not desirable.

In addition to the Sable Island source, liquefied natural gas comes to New England by ship from politically unstable countries and from refineries near the Gulf of Mexico, which could be affected by hurricanes. Because of the potential for disruption, Mr. Adams said, Maine ratepayers fork over $150 million annually in risk premiums.

The PUC report suggests three alternatives to the current setup: creating a new version of the ISO-New England deal more favorable to Maine; having Maine go it alone; and joining with New Brunswick. The draft report carefully outlines the benefits and risks of each option.

Though the energy front looks grim these days, Mr. Adams sees an up side. Maine is uniquely positioned to develop new electricity generation. If the state succeeds in changing the way it connects to the grid, the state could be an attractive place for new generation, which could create spin-off business and jobs.

The Legislature should resist the temptation to further study the PUC’s concerns and act to secure Maine’s electricity future.


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